From geek to green: Why composite application development will fuel financial recovery

Tom Crawford explains to FST how IT and business users can collaborate and utilize business technology solutions to take advantage of the green shoots of recovery.

“Successful CEOs demand increased innovation capacity, so pressure for the IT function to support the raid introduction of new products is increasing.”
-Tom Crawford

Why does IT need to change the way it supports the business and involve the business in rapid and agile development?

Tom Crawford: Recent Consumer Price Index results, General Motors' rebound from bankruptcy and general stock market trend lines all point to the beginnings of global economic recovery. Companies are positioning themselves for a return to growth; a land grab of new business driven by a desire to leapfrog the competition and get new products and services to market in weeks or months, not years, isn't far behind.

According to Forrester, increasing innovation is now the third most important executive goal for new application development. The innovation economy is driving recovery and successful CEO's are demanding increased innovation capacity and therefore pressure for the IT function to support the rapid introduction of new products, processes and opportunities is ever increasing.

We are seeing leading companies define new markets, combine products and services in new ways and introduce new business models. For example, mobile phone handset manufacturers are bundling downloadable music, maps, games and applications on handsets with varying pricing models and overall combinations of offerings.

The pressure to innovate is generating creative approaches to revenue generation and new product creation. However, it also poses significant demands on the back office to match innovation in the front office; Banks need to create a customer-centric back office that ties behind-the-scenes technologies to customer-facing experiences.

IT has a major role to play in this innovation evolution. To play that role, the function must disband older operating models and architectures to embrace collaborative development and composite, agile, services-based applications that can deliver rapid change in conjunction with the business.

The customer-centric back office sounds intriguing - and hard to do. How can firms make it happen?

Tom Crawford: Composite applications are the key to delivering on this promise. The applications leverage existing IT assets by wrapping them as services or integrating them as components into an overall application.

Using these technologies, the business can quickly model and articulate the rules for data how needs to move through the organization. Because they understand data outputs - regulatory reporting, transactional control, risk assessments - stakeholders on the business side of the organization can contribute to data flow models, business rules and process development. IT can effectively delegate these responsibilities to the business, enabling the IT organization to deliver in ever-decreasing timescales and with reduced cost and risk.

From there, subject matter experts within the organization can quickly build functionality in graphical application development tools where the data flow models, rules, processes and screens are directly run and execute from the business diagrams without the need for lengthy requirements, specification, coding and the current inevitable rework. This new "sandpit" environment lets the business model change and new functionality be introduced while IT has the same toolset to figure out integration, data model definition, security model, compliance, scalability and resilience.

Over the past ten years, our clients have told us that the ability for business and IT users to collaborate in one single application design and development environment has been crucial for business innovation and for the rapid implementation of new and agile applications. Our product, Microgen Aptitude, is completely graphical and intuitive without losing the detailed level of control, performance, integration and technology options that IT demands. 

Forester Research recently coined the phrase "Business Technology" to describe this convergence. Composite Application Development delivers 50% faster by reducing wholesale system change and introducing agility and collaboration between the business and IT.

Why do modern applications need to be services based and what does that mean for my overall architecture?

Tom Crawford: Business change is constant and the rate of change is constantly increasing therefore  companies cannot architect for a single target state or totally defined set of requirements. Instead, you have to architect for change by breaking down business operations in to a set of unified services that can be rapidly assembled in new ways with new business rules to meet the evolving business requirements.

Think of it this way: in the traditional development model, the business requirements of most IT projects change during the time it takes to take on, create and deliver the project back to the business. ETL integration, BPM process modeling, web application/form design, BAM dashboards and SOA orchestration create a complex and inefficient path for data to travel across a stack of IT tools that the business cannot use or understand. Delivery times of more than six months are common - but financial services organizations can't wait that long. This makes agile solutions that enable collaborative development with the business absolutely critical.

The benefits our clients have gained using the collaborative capabilities within Microgen Aptitude include extreme levels of performance/throughput; savings on multiple toolset maintenance and overall costs; transaction transparency and audit support; and the effective deployment of rapid composite application development. Microgen Aptitude has given these companies an overarching services architecture where logic is transitioned out of rigid legacy systems to a layer that can draw on all IT assets/components and easily adapt to evolving business rules.

IT departments need to assemble applications very quickly and then be able to re-configure these services to adapt rapidly and comprehensively to new requirements. Business users demand transparency, control and innovation in the back office to reflect the pressures and changes in the front office.  

Reorienting your IT strategy toward Business Technology can help ensure your IT requirements are met while your business strategy is supported. Ultimately, that's the way to turn geeky technology into financial growth.

Biography

Joined Microgen as Divisional MD in Feb 2003 after 5yrs as COO at another high growth quoted software business.  Integrated and led, post acquisition, four Divisions of Microgen spanning Banking, BI, Energy and Wealth Management sectors.  Now SVP of Microgen North America; building out the Microgen Aptitude business in the US.