Transcript of B2B Search Trends Podcast Based on Enquiro's Survey Findings

Edited transcript of BriefingsDirect[TM] podcast on B2B search usage, trends and future direction with host Dana Gardner, recorded June 26, 2007.

Listen to the podcast here. Watch the video here. Sponsor: ZoomInfo.

Dana Gardner: Hi, this is Dana Gardner, principal analyst at Interarbor Solutions, and you're listening to a sponsored BriefingsDirect podcast. Today, a discussion about online search and its role in business-to-business (B2B) activities, particularly the research and acquisitions process for people who are in businesses trying to find goods and services. They seem to be using search more than ever.

We're going to look at a survey conducted last March, a fairly recent look at B2B users, their relationship to search, and how search is shifting based on the findings. Joining us to discuss this we have the originator of the survey, President and CEO of Enquiro Search Solutions, Gord Hotchkiss. Welcome to the show, Gord.

Gord Hotchkiss: Thank you.

Gardner: Also joining us to add some analysis and perspective on where search for B2B activities is going is Bryan Burdick, COO of ZoomInfo. Welcome, Bryan.

Bryan Burdick: Dana, thanks for having me.

Gardner: It seems that people, whether they're buying consumer goods, small business supplies -- anything from Gorilla Glue to guided missiles -- are using search at some point in this process. Some people start and end with search. They actually buy the products through a search process. I want to start by understanding a little bit about the survey itself and the fact that it’s the second survey that’s been done on this B2B search activity, the first being in 2004.

So, let’s go to Enquiro with Gord. Tell us a little bit about the history and some of the major bullet points of this particular survey?

Hotchkiss: As you said, we did the original survey in 2004 and, at the time, there wasn't a lot of research out there about search in general, even on the consumer side. There was virtually nothing on the B2B side. We knew search was important, just from what our clients were saying and the results we had had, but we hadn’t done anything extensive enough outside our client base to start to quantify how important it was.

The first survey was an attempt to do that. It certainly proved that search was important. We found that online activity, in particular that connected with search activity, was consistent in a large percentage of purchases. In 2007, we added more insight to the methodology. We wanted to understand the different roles that are typical in B2B purchases -- economic buyers versus technical buyers versus user buyers. We also wanted to get more understanding of the different phases of the buying cycle.

We structured the survey so that we could slice the data based on those parameters and get more insight into those areas. As far as the main takeaways from the study, obviously online activity is more important than ever. In fact, we asked respondents to indicate from a list of over 30 influencers what was most important to them in making the purchase decision. Online factors, such as interaction with the vendor Website and interaction with the search engine were right up there with the traditional winner, word of mouth. What we see is a real link between those and looking for objective information and specific detail.

A lot of that search activity happens on specific properties, and we’ll be diving into that a little bit later in the podcast. We did notice an evolution of behavior as you move through the funnel, and the nature of the interactions with the different online resources changes how you navigate to them and how you go to different sites for information. But, online research was consistent through the entire process, from awareness right through to purchase.

There’s a lot of back and forth. Offline factors influence online activity and vice-versa. So, we saw a merging of the online and the offline worlds in making these decisions and trying to come to what’s the right decision for your company or what’s the right product or service.

Gardner: Tell us a little bit about Enquiro. You are a marketing, consulting, and research firm. Is that correct?

Hotchkiss: Yes. We work with clients in putting together their search campaigns in the B2B space, but we also have an active research arm. So, we're continually doing research primarily on the usability and qualitative analysis side, but we do survey work as well. The purpose of that is to provide more insight into how consumers use search and how businesses use search to make buying decisions.

Gardner: Three years between these surveys is probably not a lot for many businesses, but it’s a huge amount of time in the search industry. What would you say was the biggest difference in your results and findings over this three-year period?

Hotchkiss: Surprisingly, we didn’t notice huge trend differences in the three-year period. If anything, we saw increased reliance on online factors and probably just more activity online and more interactions with sites, but it was the continuation of a trend we saw in 2004. We didn’t see any big shifts. We just found increased reliance on online to do that research.

When we say "increased reliance," we're probably talking 10 percentage points up over the three years. So, if 65 percent of the people were doing it in 2004, 75 percent of the people are doing it now. That’s primarily where we saw the trends going.

Gardner: And, you say that that you're also seeing search applied to this process in different ways and different facets. For example, word of mouth would tip someone off to go look for something, and the first way that they look for it is by using search.

Hotchkiss: Yes. When we looked at the different phases of the buying cycle, it starts with awareness. You become aware that you need something. There was a high percentage of people -- in the high 60-percent range -- who said, "Once I become aware that I need something, the first place I'm going to go is the search engine to start looking for it."

A lot of that traffic is going to end up on Google. It was the overwhelming choice among general search engines for B2B buyers.

But, as you move through the process, you start doing what we call a "landscape search." The first search is to get the lay of the land to figure out the information sites that have the information you are looking for. Who are the main vendors playing in this space? Where are the best bets to go and get more information to help make this purchase decision?

So, those first searches tend to be fairly generic -- shorter key phrases -- just to get the lay of the land to figure out where to go. As you progress, search tends to become more of a navigational shortcut, and we’ve seen this activity increase over the last two to three years. Increasingly, we're using search engines to get us from point A to point B online.

As you get into the buying process, you’re familiar with the vendor site. You’ve been on the site. You’ve checked different product information pages. As you come back to that research process, you say, "I really want to find that product spec sheet that I saw on this vendor site." A lot of that navigation to those specific pages happens through a search engine. So, there are multiple touch points through the process.

Gardner: Now, you did this search in March, and you surveyed 1,086 people, North Americans, mostly women -- 63 percent -- average age 43 years old, with 67 percent of them having at least attended university.

Hotchkiss: Right.

Gardner: Can you tell us little bit more about these people? Are these people that you acquired through strictly business activities? How did you know that they were in a purchasing mode?

Hotchkiss: When we structured the study, we used our sampling partner, Survey Sampling International, for access to their B2B decision-maker panel. In two different parts of the survey, we asked, “Are you currently considering a purchase in excess of a thousand dollars?” That was a qualifying question. If they answered yes, they got to continue the survey.

That’s how we determined what role they were playing in this purchase that was happening right now. What were they considering purchasing? What was influencing them? We wanted to use a purchase process they were in the middle of, because it would obviously be fresh in their minds and they could really tell us what they were going through, as far as what influenced them.

We also wanted to get a retroactive view of a successful transaction. So, in the second part of the survey, we asked them to recall a transaction they had made in the past 12 months. We wanted to see whether that initial search led to a successful purchase down the road, and, at the end of the road, how the different factors influenced them. So, we actually approached them from a couple of different angles.

Gardner: Now, 85 percent of these people say they're using online search for some aspect of this purchasing process. It strikes me that this involves trillions of dollars worth of goods. These are big companies and, in some cases, buying lots of goods at over a hundred thousand dollars a whack. Do you concur that we're talking about trillions of dollars of B2B goods now being impacted significantly by the search process?

Hotchkiss: Absolutely. The importance of this is maybe the most mind-numbing fact to contemplate. Traditionally, the B2B space has been a little slow to move into the search arena. Traditionally, in the search arena, the big advertisers tend to be travel or financial products.

B2B is just starting to understand how integral search is to all this activity. When you think of the nature of the B2B purchase, risk avoidance is a huge issue. You want to make sure that whatever decisions you make are well-researched and well-considered purchases. That naturally leads to a lot of online interaction.

Gardner: I suppose if I am making a $100,000 purchases, and I make a mistake, I am not going to be around for long. Right?

Hotchkiss: Exactly. The other thing is that we don’t tend to be as emotionally involved with the B2B purchase. Things like branding play different roles than when you're doing consumer purchases. The brand affinity is something you might have if it’s an area where you don’t have a lot of experience. It may be a new need that’s coming on the horizon for your business. You are really starting from Square One, and that’s the perfect place for search to plug in and be the solution when you start researching those purchases.

Gardner: Right. These folks are looking for practical approaches and real information. Let’s go to Bryan Burdick at ZoomInfo.

This is growing quickly as an overall trend, but ZoomInfo, which is focused on business search, is growing much more rapidly. What’s driving your growth at ZoomInfo, and how does that relate to this B2B search activity?

Burdick: The business information search is a primary factor driving our growth. Our company right now is growing on two fronts. One is our traditional paid-search model, where we have subscription services focused on people information that is targeted at salespeople and recruiters as a source for candidates and prospects.

The more rapidly growing piece of our business is the advertising-driven business information search engine, which I think is a really interesting trend related to the concept you guys were just talking about. Not only does the B2B advertiser spend lots of money today trying to reach out, but the B2B searcher has new tools, services, and capabilities that provide a richer, better, more efficient search than they’ve had through the traditional search engines.

Gardner: By far, the largest player in this is Google with, according to the Enquiro survey, 78 percent use by this group of respondents. Way down the line was Yahoo!, and then far below that was MSN. It strikes me that Google is a general search engine, and yet we are asking for very specific business information.

Bryan, do you expect that we are going to see some sort of a specialization or a cleaving between general search and more vertical specialized search?

Burdick: Absolutely, and, in fact, that’s really ZoomInfo’s mission -- to do for the business-information search world what the Expedia or Travelocity did for travel search. When you think about it, you can actually go to Google and find an airplane ticket, but why would you?

It’s so much more efficient to go to one of these vertical search engines that are looking at the databases, looking at the data, and indexing it in a much more efficient way. You're starting to see that in a lot of other verticals. Travel has been the quickest to adopt that, but everything from business information, like ZoomInfo, to podcasts with Podzinger, and other types of vertical searches, have been focusing on a niche and organizing the content more efficiently.

Hotchkiss: One thing we found in the survey is that there's a natural evolution through the process. Although you might start on Google as you are trying to find those information sites, quite often it’s the verticals that people work into as they are starting to look for specific, more granular information on the companies they're thinking of doing business with. That’s where ZoomInfo and other vertical players fit a need.

Gardner: I suppose another thing that seems the same from 2004 to 2007 is the importance of a supplier’s Website. According to your survey findings, people are very interested in word of mouth. They use the search engine to move from that point to gather more information, but they're very quickly interested in solid, simple, straightforward, text-based information from the suppliers themselves. I suppose that underscores the need for sellers to have a very strong Website.

Hotchkiss: That was a really strong finding, and not really surprising. It made sense, but I think how important the straightforward information was to the people doing the research was somewhat surprising. It’s one of those things where you get findings in research and then afterwards, when you apply common sense to it, you say, "Yeah, that just makes sense."

But, remember these searchers are out to gather information for an organizational buying model. They are gathering information that will, in a lot of cases, be passed on to other individuals to help them make the decision as a group.

You don’t necessarily want to sit through a linear presentation of information, like an online video, or even a podcast, if your intent is just to pickup specific data and pass it along. Now, if you are the user, and this is that something you are going to be using, you may be a lot more open to a linear how-to demo. But, it’s important to match the content on your site to the types of buyers and individuals who are gathering the information.

The takeaway we got from this was to make sure you're covering the basics first. Make sure that you're getting the clear concise product information out. In a lot of cases, you know you are going to be compared to the competition. Why not enable some of that to happen on your site and make the buyer's job easier by arming them with the necessary equipment.

The number one thing that came across as desirable was pricing information, which is really tough for B2B marketers to put on the site, because in a lot of cases these are complex solutions. But, what the buyers are looking for is qualifying it in a budget range.

Is this a $10,000 purchase, a $100,000 purchase or a million dollar purchase? I need to know that to qualify, so I can move on. Please give me that information. It can be ranges. It doesn’t have to be specific, but I need to be able to qualify it.

Burdick: Dana, I would add that some of the typical mistakes that a B2B marketer will make from a search-engine marketing perspective is jumping too quickly or focusing too much on the actual advertising piece. They need to do that, but sometimes they forget about the search engine optimization. Very often, they leave that up to the technical team, which may optimize the search or the site in ways that aren't optimal from a marketing perspective.

Then, as Gord was saying, they get the user, or the potential customer, in there and the customer gets lost on their own site, searching for the type of information that they're looking for. It’s not like a consumer model, where the consumer already knows, in most cases that they are looking for a DVD player or whatever it is. They may even have a model number, and they're looking for the best price online. It’s much more of an information-gathering process in the B2B case.

Gardner: Perhaps the takeaway here would be that people want to get just the facts upfront and they want a ballpark figure, but they also want to be able to use search to get to that information fairly quickly.

So, if you’re going to optimize your site, your key information can’t be 18 pages deep into the search process, but you also have to consider that factual information needs to be as accessible as your main branding page.

Burdick: Absolutely.

Hotchkiss: One more point on that. A lot of B2B marketers like to capture as much information about a lead as early in the process as possible, so it can be handed over to the sales department, which can close the sale.

But, what happens in a B-to-B purchase is that the first touch point with your vendor Website is typically not the decision maker, the ultimate decision maker? It tends to be somebody who is gathering information to help arm the company to make that eventual purchase decision.

So, if you push to establish contact with that person, they're not ready to establish contact with the vendor, because they don’t have the buying power. Even if you do push to get it, your salespeople are spending a lot of time following up on leads that aren’t qualified buyers. They have to retrench down the road and try to re-establish connections with the person who has the economic power.

So, it’s really a "date," and, in a lot of cases, it’s a long series of dates. If you push too fast you are just going to push the prospect away.

Gardner: You don’t want to propose on the first date.

Hotchkiss: Yeah.

Gardner: On the other hand, one of the findings from the survey was that 50 percent convert to a sale online. So, that means that when the research, winnowing, triage, and the comparative shopping are over, the economic buyer, who is empowered to make a decision, will go back online and consummate the deal. Does that make sense?

Hotchkiss: Yeah. Here's some further insight into that, because we saw that number surprising when we did the overall data. When we pulled the data apart, we found that a lot of those purchases tended to be things like computer systems, where they might have been buying through a Dell or someone like that.

Gardner: The direct model.

Hotchkiss: We thought that was a really high online conversion rate. As we looked at the data a little more, we saw that in a lot of cases it was smaller software purchases or system-based hardware purchases. That made a little more sense, as we went down that road. There was a fairly strong manufacturing component, where people were buying parts and different things. In those cases, a lot of those purchases are made through an electronic marketplace. We're seeing that as an increasing trend too, e-commerce-enabled market places.

Gardner: I suppose it's also logical that when the price or the total purchase price is less than $50,000 or closer to $10,000, they’ll be more likely to do that online confirmation and make a purchase. To me, this says that small- to medium-sized businesses selling small types of goods should be very focused on search and B2B online activities. Does that follow?

Hotchkiss: Everybody needs to be focused on search. I can’t see an exception. You mentioned the percentage that said they would go online. We segmented out the group that didn’t indicate they go online to see what was unique about them.

The only thing unique about them was their age. They tended to be older buyers and tended to be with smaller organizations, where the CEO was more actively involved in the purchase decision. That was really the only variants we saw. If it’s a generational thing, then obviously that percentage is going to get smaller every year.

Burdick: Dana, could I ask Gord a follow-up question to that?

Gardner: Of course.

Burdick: I'm curious whether, as you dug into the data, you saw any differences between online follow-throughs to purchase on hard goods versus services. I'd think that people buy computers online, but if they're buying services from a B2B company, that tends to be offline.

Hotchkiss: When we were looking at influencing factors, B2B services was the one where word of mouth edged out online factors by a significant margin. When you're trying to retain a service, word of mouth is still very influential. In pretty much every other category, online was right up there with word of mouth, in some cases edging it out as an influencing factor.

Gardner: Okay, another number from this was that 95 percent said they use search to find what they want at some point or another, but 37 percent were still seeking other sources. There seems to be a recognition that search is very powerful, that it’s a tool that shouldn’t be ignored under any circumstances, but that it's not getting the entire job done. Bryan, I wonder if you could respond to that. What else needs to happen in order for these people to get what they need?

Burdick: The short answer is they just need to come to ZoomInfo.com. Seriously, I don’t think it’s a matter of needing more information, but, in some cases, finding better information. When you think about the traditional search engines -- the Googles and the Yahoos! of the world -- there are so many consumer-oriented search transactions on a day-to-day basis that they have optimized their experience with the consumer in mind.

Search engines like ZoomInfo and some of the other business-information search engines are taking a different approach and optimizing the search experience, and therefore the relevance of the results, with the business-information searcher in mind. You can much more efficiently and quickly get to the information you're looking for.

The simple example that I like to use is that if you search for "enterprise routers" on Google, you are going to get 32 million results that will include everything from Enterprise Rent-A-Car to the latest episodes of Star Trek. Search for that on a business search engine like ZoomInfo and you'll get 150 companies that sell enterprise routers or manufacture enterprise routers. It just becomes a much more efficient process.

Gardner: Well, even the alternatives cited in this survey are still very general. There was Business.com and Thomas Register. This is every good under the sun. It might as well be a general search. KnowledgeStorm was also mentioned, but it's very specific to IT. It seems like there’s a whole category that needs to be filled here around vertical business search.

Burdick: The original survey that Enquiro did for us in 2004 was a key factor in our decision to move to more of a search-engine model, because what we see happening is the same kind of evolution that happened with the big search engines way back. It’s happening now in the vertical-search categories, where search engines started out as directories or, if you think back to Overture in their early days, totally paid listings.

Eventually those two forces came together to provide a best-of-both-worlds situation, where you’ve got not only great relevance on the results, but also great relevance on the targeted ads, and now that’s starting to happen in the verticals as well.

So, you’re starting out with some of the business-directory sites or the business paid-listing sites, because those are easy to do. As the technology gets more sophisticated and you can provide more relevant results for the business information seeker, you are delivering the value that the information seeker is looking for. Plus, you can target the ads better and provide an overall better experience.

Gardner: Let's go back to Gord on that. The survey found a larger percentage of people looked at the organic results on the left, but they were pretty much limited to the top four. A smaller percentage, about 12 or 13 percent, said that they look over to the right-hand side for the ads. That 13 percent might sound small, but compared to a click-through rate in a Web advertising model of usually less than 1 or 2 percent, 13 percent is still a pretty large chunk of people. What’s your impression of the impact of the advertising model in search for B2B activities?

Hotchkiss: Those percentages, by the way, aren’t that different from what we've seen in consumer-based research. Those breaks between organic and sponsored tend to remain fairly consistent across a number of different channels. One thing that’s just golden about search is it will connect a motivated and engaged user with the content they are looking for.

If that content is provided by a relevant ad, then they're open to that. In fact depending on where they are in the buying cycle, they may even be biased toward that, because they are ready to get information from somebody who is trying to provide them what they need to decide whether this is the thing they need to buy.

There's a totally different interaction when you're on a search engine actively engaged in a task and actively looking for information. You're far more receptive to messaging at that point. You're actively looking for it. And this seems to be slowly breaking into the consciousness of most advertisers. They're getting it, but they're getting it slowly. Anyone who moves into the search space, if they do search in a smart way and they capitalize on the potential of it, is just amazed by the return they get on this.

Gardner: Let’s beg a little more from these results than was intended. I started to see in the findings some patterns about typical processes, about how people would go about this activity -- the awareness, the research, the purchasing, and so forth. It seemed to me that there was, on one hand, a pattern of word of mouth that led to a search, that led to a Website, that then led to a refined search based on what they found, which then led to a hand-off to a purchasing activity by maybe a different department or individual.

There also seem to be offline influences, perhaps trades shows, perhaps traditional sales calls and activities, but that also took into consideration word of mouth that then identified what to search on, and so on. Am I reading too much into this, Gord, or were there patterns of process around the use of search in the purchasing activity?

Hotchkiss: It goes back to what I said before. Search tends to be the thing that connects you, as you move through the buying process, and it’s used in different ways and places as you progress through that. As far as identifiable patterns and usage behavior, if you did an end-up study of a large enough dataset, patterns would emerge. They always do emerge, but I'm not sure we would be confident enough diving into this particular dataset to try to tease that out of it.

What we did see is that B2B buying decisions are tremendously complex when they are compared to an individual consumer buying decision, where you have one person going through all the phases. You have multiple individuals influenced by different factors going back and forth.

What is consistent in that is whatever is influencing you -- whether it’s online or offline, a discussion with a colleague or a recommendation by a paid consultant -- there tends to be a mirror activity, in which whatever happens offline generates some kind of online activity that typically is initiated through a search engine. Then, you pull that information back, and it dances back and forth between the online and the offline world.

Gardner: So, there’s a barrier here in some senses. I'm sure most companies, especially the larger ones, have a standard operating procedure about how purchases will happen. It will be form x, y, z, and it will go through process review a, b, c, and then we’ll have to get signatures from individual g, b, h. How can we bridge this value that people see in search, and somehow bake that into a procedural process inside of an enterprise. Or are we asking too much here?

Hotchkiss: One of the interesting things, being both a researcher and a vendor, is we get to see both sides of it. We have access to more information than ever before, and buyers out there are armed with better information before they ever initiate contact with a vendor. They are gathering a lot of information and then they are trying to cram it into an existing buying process, whether that’s an RFP process or whatever.

So, like most things with the Internet, the traditional systems are being challenged by this new access to information that we never had before.

Over the next two to three years, what we're going to see is organizational buying processes being streamlined and being able to incorporate the fact that you have better informed buyers than you may have had before. The whole RFP process was to eliminate risk. The reason was make sure that you are considering alternatives and to make sure that you are almost forced to gather the information you need to make a dispassionate judgment about what was the best choice.

Now, in a lot of cases, the decision is already 80 percent made before the RFP process ever begins. Somebody has researched a vendor, has a very strong feeling about the vendor but now has to try to fit that into the established procedure, and they say, "Okay, now we've got to go out and find two or three more alternatives."

Heaven help the other two or three alternatives that are getting involved in that process. They have to go through the whole dance, but usually the preferred vendor on the front end gets the business on the back end. The other two or three players are just used as negotiating chips to try to get the price down. It’s interesting to watch how information from the Internet is changing virtually everything out there. This is no exception.

Gardner: This might be a little bit out in the future, but the role of search could morph into the role of auction and brokering activities. Does that make sense?

Hotchkiss: Yes, and for players in the space -- I suppose ZoomInfo as well -- if we can streamline the marketplace, if we can take this access to the information and make the buyer’s job easier, that’s a tremendous saving. I would hate to think of the number of man-hours that are invested internally in an organization for a fairly major purchase decision. How much more efficient you can make that process by simply empowering them with the information that they are going out to look for anyway?

Gardner: Bryan, you said that the Enquiro survey in 2004 made an impact on ZoomInfo in terms of its direction. Have the findings from 2007 had a similar influence? What new directions might you be heading in?

Burdick: As Gord had said earlier, the findings in 2007 reinforced what they had already learned three years ago. So, in one sense, it confirmed our own strategic direction as well. We re-launched the ZoomInfo.com site back on April 1, and moved into more of a traditional search-engine model, where all of the content, all of the search capabilities on ZoomInfo.com are free and subsidized by advertising.

We’ve seen that piece of our business take off like crazy in the last couple of months. Search traffic has grown dramatically. We’re up to close to 5 million unique visitors a month doing about 16 or 17 million searches a month on our site. All that is really driven by this need, this desire, among B2B buyers to find a more efficient process to get at this type of buying information.

Gardner: What advice would you have for those folks that are on the selling side of this? What should they do to position themselves in order to take better advantage of what’s occurring on the buyer side, particularly, in their use of search?

Burdick: There are a couple of landmines or traps to avoid. The first is to try to avoid competing with the consumer brands, either on the traditional engines or with the same types of keywords. If you are buying the same keyword as a consumer brand is buying on one of the traditional engines, you are typically going to get drowned out by the noise.

The other thing is to make sure that your own search marketing is coordinated with channel partners. I’ve seen lots of examples where the manufacturer is buying a set of key words and their value-added resellers are buying the same keywords. They end up bidding up the same keywords just to attract the same eyeballs. At the end of the day, the manufacturer is going to direct them to one of the resellers anyway.

Gardner: So that leads to confusion, rather than streamlining that particular process.

Burdick: Exactly. The other key thing, which we already touched on, is leveraging not only on the marketing side, but the search-engine optimization of your site in general, and optimizing the search-for-information experience that the buyer has once they get to your site.

Hotchkiss: One thing I would add on a more fundamental note is to make sure that the perspective you are using to evaluate your search strategy is the customer’s perspective and not your internal one. One of the common pitfalls we see is companies get into a bad case of "internal think." They look at everything from their internal perspective, and they are not shifting the looking glass 180 degrees and looking at it from their prospect’s perspective.

It’s amazing how enlightening it can be, when you start looking at what types of sites they are going to. You need to catch their attention, and know what kind of messaging you have to present and what kind of onsite experience you have to present, once you are successful in capturing the click. If you can force yourself to see from that perspective, you're going to do more to improve the effectiveness of your campaign.

Gardner: Well, thanks very much. We’ve been discussing the recent survey by Enquiro Search Solutions. It was Enquiro’s 2007 B2B search survey, and to help understand it better we’ve been joined by Gord Hotchkiss, the president and CEO of Enquiro. Thanks, Gord. Is there anything meaningful in the survey that we didn’t cover and that you think we should?

Hotchkiss: The original release covers the high-level findings. What we're working on now are three follow-up white papers that will be available on the site through the next three to four months. We're going to take each of the three buying roles that a lot of people within the survey fell within -- the economic buyer, the technical buyer, and the user buyer.

We're going to do insight from that particular buyer on how to search more effectively, plod through the process a little bit more, and how those hand-offs happen from role to role. I imagine there are going to be new insights out of that. We're taking different slices of the data. So, for those of you who are interested in that, keep checking out on Enquiro.com and we’ll ping you as those white papers become available.

Gardner: Terrific. And we’ve also been joined by Bryan Burdick, the chief operating officer at ZoomInfo. Is there anything that you’d like to cap the discussion with, Bryan?

Burdick: Only that I think from a vertical business information search perspective, that we’re really in the first inning here. A lot of interesting trends and enhancements are going to be coming down the road. One in particular that may have an influence in the next year or two is the community aspect within the search.

Gord, talked earlier about how there are multiple people that influence the B2B buying decision. I think that you’ll start to see a marriage of, not only B2B search, but also online community and a factoring into that whole process. Then, who knows where we’ll go from there? But I appreciate you having us on.

Gardner: I suppose that this notion of word of mouth being so important in shaping people’s direction that you might use search to find the word of mouth.

Burdick: Right, the word of community.

Gardner: There it is. Okay, well thank you, Bryan. This is Dana Gardner, principal analyst at Interarbor Solutions. You've been listening to a sponsored BriefingsDirect podcast. Thanks for joining.

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Transcript of Dana Gardner’s BriefingsDirect podcast on B2B search usage, trends and future direction. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.

SOA Insights Analysts Discuss Likely Future of SOA at Open Group Conference

Edited transcript of weekly BriefingsDirect[TM] SOA Insights Edition podcast, recorded July 23, 2007.

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Dana Gardner: Hello, and welcome to a special presentation of BriefingsDirect SOA Insights Edition, an ongoing series of podcast discussions on Services Oriented Architecture (SOA)-related news and events with a panel of industry analysts and guests. I'm your host and moderator, Dana Gardner, principal analyst at Interarbor Solutions.

We are recording this special podcast on "The Future of SOA" before a live audience at the July 23^rd, 2007 plenary session of the Open Group’s Enterprise Architecture Practitioners Conference in Austin, Texas. Welcome to you all.

Our panel today consists of Eric Knorr, executive editor-at-large at InfoWorld. Also, Tony Baer, principal at onStrategies; Todd Biske, principal architect at MomentumSI, based here in Austin, and, Beth Gold-Bernstein, vice president of ebizQ Learning Center. Welcome to the panel.

Our topic today is “The Future of SOA.” We want to take a look at what might happen if a lot of the things we’ve been considering for SOA actually happen.

One of the interesting things we heard this morning from Dave Linthicum was that he's anticipating that, in as few as five years, the role of enterprise architect and the role of SOA architect will meld.

I thought that was a little ambitious, and I wonder if I could put that to our panel. Before we get into the future of SOA, we should actually determine when the future of SOA will be important.

Beth, what do you think about five years? Do you think we are going to see SOA actually become part and parcel of all enterprise architecture activities?

Beth Gold-Bernstein: Five years is definitely ambitious. All the polls that we’ve done at ebizQ have shown that the market is really in the early stages of adoption. From my point of view, the sooner the SOA architect’s role is rolled into enterprise architecture in terms of governance the better. It is a subpart. And it is, as Dave said, best practice in architecture. We’ve known that for a couple of decades, actually.

We are getting there. Standards have gotten in. But there is more to that than just architecture. It fundamentally changes the way we create applications. That means developers need to change the way they are architecting applications, and that’s very different. It's going to take quite a while until we build up the different levels of services.

Gardner: I’ve always thought that SOA was a journey, in which you never actually get to the destination. Todd, what do you think? Is this an ongoing journey, or is there a future point for SOA when we can determine, “We’ve made it; it’s working”?

Todd Biske: I definitely agree that it's a journey. One of the things that I have seen in my work as a consultant, and prior to that as a practicing enterprise architect in a major enterprise, is that you're always going to have these new initiatives come along that may start out from a point solution.

Just as was said this morning, if solves a small percentage of my problem, if you're only looking at a narrow scope, and you’ve got boundaries around it, you are not seeing the whole enterprise.

So, in enterprise architecture practice the enterprise is not going to go away. It will continue. It’s always a journey that we have to integrate, whether it’s SOA, BPM, or any of these efforts into those long-term initiatives that keep going on.

If the company goes away, well your SOA probably will go away with it or at least be folded into someone else's. But definitely it’s a journey that involves culture change, and that takes a long time.

Gardner: There's an interesting whitepaper being delivered at this event, and it’s part of this notion of "boundaryless information flow." It appears to me that we're all going to be creating new information on an ongoing basis throughout our organizations. So, the boundaries will always be created, and therefore will need to be torn down.

Let’s go to you, Tony. What do you think about this notion of "people" as an important element about the future of SOA?

Tony Baer: There’s no question about it. You and I have been bouncing off each other a new acronym -- and I’ll have to credit you on it -- human-oriented architecture (HOA). Those of you who have been looking at the headlines over the last few weeks, have seen that the usual suspects on Oasis -- IBM, SAP, Oracle and others -- have formally said, "We are going to submit a proposal to incorporate human workflow into BPEL" -- actually into SOA in general.

It’s a recognition on their part that very few processes are completely automated. That’s one side of the story. The other side is that, when you are looking at defining processes, you have to take a look at the context of people's roles, whether the process is automated or not. So, it goes both ways. You can’t have SOA without people, whether you call it human-oriented architecture or whatever.

Gardner: Alright, Eric, to you now. We might actually drop the words, "Services Oriented Architecture." We might still call it generally, "architecture," but it does seem as if this is always going to be a chicken-and-egg relationship.

As we get more kinds of processes, we're going to come up with different standards to try to tear down different walls around siloed platforms or information stores. If we don’t call it SOA in five years, what do you think we should call it?

Eric Knorr: Dave had it exactly right this morning. It’s something that will be subsumed within enterprise architecture, as a whole. It’s part of the ongoing saga of making IT more efficient.

If you listened to Dave’s keynote this morning, he also mentioned that out of the implementations that he had seen, 80 percent were in trouble. Adoption, on a broad level, is still relatively at an early stage right now.

So there is a certain danger right now in SOA in terms of the acronym and its impact on the industry. It maybe another one of these initiatives that looks like it’s going to be very successful. You go through the hype curve, and then it begins to fall away. When that happens, I think it will be absorbed into enterprise architecture. The basic principles won't go away.

Everybody is gravitating toward service orientation within the enterprise, and there are all sorts of reasons why that makes sense from management and architecture reasons, redundancy development, and other things. That will continue to go on, but as a trend, it may have a definite life span -- and that may be only a couple of more years.

Gardner: An interesting observation from the last presentation from Deutsche Bank was that the costs seemed to be going down, according to their forecast over the next several years, and that benefits are going up, at least in terms of one subset of SOA activities. That would lead us to believe that, at least from Deutsche Bank’s perspective, SOA is going to be an ongoing productivity benefit.

If we are able to create a more boundaryless enterprise, if we can get people to work more harmoniously with processes, and agility and change become de facto attributes of IT, then we really will be coming up with something different.

So, let’s look at that. Let’s assume that much of what we’ve heard today is prologue to the future, whether it’s five, seven, 10 years -- and whether we call it SOA or not is not so important.

How is this going to first affect the IT department? Then how is it going to affect the business? Then, take a step further and ask how this might change the characteristics of what we consider companies and how they relate to one another.

Let’s start with the IT department. Todd, you’ve worked in an IT department. If you had a boundaryless information flow, if you had agility, and you could have IT work at the pace of business, what do you think the impact would be on how IT departments actually behave?

Biske: It would be a dramatic shift from what we see today. As Beth pointed out, and other people have said, adopting SOA is a fundamental change in the way that IT operates. It’s a cultural change, and an example that I point to is the notion of a service provider.

During the Austin Energy presentation today, I asked, “A power company is a service provider. They are used to that concept. How does IT act as a service provider, whether they are doing internal services used by their colleagues on another application or are producing services that are being used by customers, business partners?"

We're used to building a solution, putting it into production, and going on to the next project. IT is a very project-based culture.

If you move to SOA, you have to shift more toward a product-based culture, where you have a life cycle that goes on over multiple versions and doesn’t end until you take that service out of production.

You have to deal with customer management, looking at the different scope -- one of consumers and how they utilize those services. How you leverage that information in building new services is where it may tie into your business intelligence (BI) efforts and technologies associated with that. This move from a project-based culture to a product-based culture will be the biggest shift.

If you want a good example, look at companies that practice product management, and at the things that they sell, and you will probably gain a good idea on how IT needs to operate.

Gardner: Beth, you’ve mentioned that you think there are a number of technologies that are going to be important in terms of how they relate to SOA activities. What’s your take on how this agility that we’re anticipating will affect the adoption of technology within IT departments?

Gold-Bernstein: There are related technologies on this. BI is one of them. It’s very important to get the business value out of the SOA infrastructure. BPM is another that is separate technology, but related to SOA.

Very directly it can be used to create the overall end-to-end process. While underlying services are delivering the functionality of the overall application, business process management (BPM) will give you visibility and monitoring.

Also, event-driven architecture (EDA) processing is a separate discipline, but an event-driven SOA delivers higher agility. It provides even predictability, and the technologies are coming forward.

So once you have the SOA infrastructure down, the discipline of creating very loosely coupled components, and layering on top of that BPM and event processing -- then you will be able to deliver to the business the value, the intelligence, the visibility, the monitoring, the predictability that will make the business more agile.

Gardner: Are you anticipating that, as SOA is adopted successfully, it acts as a catalyst, accelerant, or a multiplier to the adoption of other technologies that can then be brought to bear on business issues?

Gold-Bernstein: Absolutely.

Gardner: What’s your take on that, Eric? Are you as optimistic, or do you have any cynicism on that?

Knorr: I wouldn’t say I am cynical about that, but what Beth says does make sense. It’s interesting, too, to see what happens to applications like BI that right now have their own proprietary integration infrastructure in the enterprise.

That’s a big part of what the BI players offer. What’s left? Well, the analytics. As you see SOA methodology spreading through the organization and the ISVs, you'll begin to see a more component-oriented way of developing applications that will permeate the commercial software vendors.

That’s a very long-running project. SAP has been talking about that since 2000. Oracle seems to have jumped in a little bit further with the Fusion platform, while that remains to be seen in the way it plays out. But I do think it will penetrate those areas, and the event-driven angle is very important.

Gardner: Before we leave the implications for the business, we also need to step back and revisit what Dave Linthicum said this morning about other mega trends. He mentioned Software As a Service (SaaS). We have heard other blanks or X’s "as a service," whether it’s integration, platform, or infrastructure.

What do you think will be the impact on IT and the business, as SOA not only opens the floodgates to some of these other technologies, but also opens the floodgates to more ways of acquiring and consuming services outside the organization?

Tony?

Baer: In a way, that’s déjà vu all over again. I remember that during the bubble, when we were all having a lot of fun, we were talking just B2B exchanges. It was the idea of, “Well, you can find something.” It was like an eBay for the supply chain.

You can see how far that went, because it went against established practice in the supply chain. Twenty years of supply chain management theory was: Consolidate your partners, get to know them better, and don’t partner anonymously.

My sense is that what has to come of all this is not just a random coupling. Ten years ago we said all these components out there are not going to just couple randomly. There are going to be partnerships. We were starting to talk the other day about semantic integration, but behind every successful semantic integration is a successful human partnership.

Gardner: So part of a SOA success trajectory would be the ability to consume, as an enterprise, services in a marketplace, where such pressures or forces as competition and a drive for lower costs and higher benefits could play quite nicely.

Baer: And partnerships …

Gardner: And partnerships, so that you find areas where you might overlap with someone in your supply chain. And you must start handing off some of your services, and you might adopt some of theirs.

Baer: Or, perish the thought, start within your own enterprise -- if you can get beyond all the political roadblocks.

Gardner: There are political roadblocks inside of your departments and your companies. Imagine the political roadblocks you’d fight trying to partner with others companies entirely?

Baer: Exactly.

Gardner: So we do come back to this "people" and "what I learned in kindergarten"-mentality.

All right, so let’s not think SOA is all just peaches and cream. You mentioned this semantic issue, Tony.

If I've got a Tower of Babel inside my enterprise, or in a department, where different types of doing things or identifying them are scattered across whatever someone puts in an Excel spreadsheet, then we have this ongoing battle around how we identify that which we want to use, consume, or produce within services.

Todd, let’s get back to you. Let’s discuss what I believe is an inhibiting factor, which is this whole semantic issue. What do you see happening around standardization that is a counter force to that?

Biske: I don’t know that it’s so much standardization that’s the counter force. Certainly it is, but I look at the information integration problem, or master data management, enterprise, logical data model, whatever you want to call it. It's actually a good space to look at and say, “Okay, what do we need to fix to do SOA right?”

Groups trying to do a master data management (MDM) effort or come up with an enterprise canonical data model create this group that goes off on an island. They sit there, lock themselves away, and try to come up with this uber-model, but they miss making the connection back to the people that are working on the projects that actually need to use that information.

It's pointed out that it takes too long to get it done, or it's not meeting my needs. The same thing can happen with SOA if you’re trying to define services in the enterprise context. We don’t want this to happen.

In both of these cases, we need to figure out how to make this information relevant to the projects that need to execute properly and take those incremental steps to get us there.

Clearly, having a consistent semantic model is critical to the success of SOA. If we don’t get the consistency across our services, we wind up creating more work for the consumers. And as the previous presenter from Deutsche Bank said, it’s all about consumption. It’s not about producing. It's about creating services that are easy for our consumers to use.

Gardner: Beth, how do you think that some of the technologies that you mentioned earlier, intelligence and management of applications and services, can be brought to bear on the semantic issue? They seem somewhat divorced at this time.

Gold-Bernstein: Actually a different technology that’s being brought to bear is semantic integration technology. There are standards bodies. I know that the Open Group is working on some of that as well, and some vendors have put forth some semantic integration or enterprise information integration (EII) products.

Software AG came up with one. They have inference engines underneath them. I can remember being at the conference when IBM introduced SNA and told everyone, “You have to build your enterprise data dictionary.”

I worked with organizations that did that. They had the books on their shelves, but it didn’t do anything. They were just books on the shelves. The difference now is that we have the integration technology, and with these semantic integration technologies, we can build these taxonomies incrementally on a project-by-project basis, and then add to them over time, grow this in an organic way, and still be able to move forward that way.

I think that will be the successful way. Semantic integration is not receiving a lot of press. Software AG brought out a great product a year and a half ago or so, and is going nowhere with that so far. That is the future and a very important one, because a dirty little secret about integration, is that 80 percent of the budget is spent on semantic integration.

Gardner: Eric, in addition to the semantic issue internally, as we discussed, being more influenced from outside the organization, we already see popularity of things like mashups, RSS feeds, and content brought to bear on business processes.

Do you think that, as SOA matures and we look to the future, there needs to be a delineation between internal and external content, and who's going to be in role of managing that boundary?

Knorr: I'm not sure who's going to be in that role, but mashups have an immediate role now for SOA adoption. Basically, if you were able to wave the magic wand today and transform your entire application infrastructure to make it SOA-based, you wouldn’t see any difference.

So mashups are a great selling tool. They may not be strictly SOA, but if you got a couple of internal data sources, and maybe Google Maps on the outside, and you throw some Salesforce.com data on there too, you can begin to illustrate for upper management, what agility looks like. That’s one good thing about mashups.

I've been surprised in some of the panels that I have done, with the resistance you get, even to something like Salesforce.com, which is a fairly well-established application right now in the marketplace.

Gardner: It’s a business application right?

Knorr: Right. But, back to the mashups, I think a good way of looking at mashups from a practical perspective and how they fit into all this is that there is a lot of rogue application development going on there under the radar, that nobody in upper management really knows about.

So mashup platforms -- whether they are from BEA or IBM -- they have their first iterations of those types of platforms, or outside the firewall, where you are actually doing development on the outside. These provide a framework for the rogue application development.

Eventually this kind of stuff outside the firewall will be folded into the greater SOA somewhere down the line. In a way, that’s really what's most exciting about SOA, and most difference is the ability to begin to connect to those external services and bring them into the fold.

This goes back to the early days of web services. XML grew out of a desire to open up EDI, and there was this whole thread of web services that were all about B2B connection. Then came Microsoft, saying that one day the Internet will be the operating system, and we will build applications on top of it. Well, that’s interesting to see.

Gardner: I suppose another way of looking at this is that the pendulum keeps swinging across several major variables, one being distributed, and then consolidated. And we go back and forth. And another is complexity that gets solved, but then simply opens up another type of complexity that needs to be solved arrives.

And so if SOA is successful, it seems like we're dealing with a complexity of integration, but then that opens up the complexity of semantic issues, and people and behavioral issues, and then boundary and political and government issues.

So assuming that we can get boundarylessness on this sort of scale, and we have the pendulum going back and forth among these complexities, does the business recognize enough return on investment to say that SOA was worth it? And when will we reach that sort of an economic business rationale? Tony?

Baer: I hate to say this, but I just recalled what David Linthicum was saying this morning about the inherent tension between-project based SOA and the enterprise architects. We all seem to be talking past each other.

To satisfy your client in the business, you are going to show them that it’s deliverable. And the client is saying, "I am not paying for your enterprise architecture. I want a solution that helps me right now that’s a sure fit, an 100 percent fit. I do care if you make it 80 percent, and I have to pay the cost of generalizing it to the rest of the enterprise." So, there is an inherent tension there.

I like what Eric was saying about using mashups as a step forward. That’s what you were saying about semantic integration. We need to work this from the ground up instead of the grand enterprise data model.

We have to take an incremental approach, and don’t try a project to boil the ocean. Then, after you’ve done that, if you can somehow sell it to the business, there might be some internal budgeting mechanism or brownie points, where there can be some sort of internal trading system. And then maybe there is a way to subsidize that extra 20 percent of development.

Gardner: Now, wait. I thought that SOA was going to make agility the number-one requirement that we are going to meet in IT departments. Whether you're Deutsche Bank with a five- to seven-year window on recovering costs -- or a bit more of a common company that has to deal with quarterly returns, and are seemingly always under pressure to cut costs -- there's got to be a better business payback here.

Does anyone, as we discuss the future of SOA, have a sense of where the business people recognize that this is successful and we have made it? What sort of benchmarks would that require?

Knorr: I have a comment on that one. It all has to come back to the business strategy. There are a number of organizations out there that don’t have an enterprise architecture practice, yet, they're trying to do SOA.

As a result you have SOA applied to projects, and you are missing the point that’s on the strategic side of this. We've heard the term "boil the ocean."

We can go to the opposite extreme as well and say, “Okay, I am going to just redo all of IT. We're going to change all of the fundamentals behind this and do it all at once.” That’s not going to work, to completely do the opposite extreme in saying, "everything is ground up."

You need this middle-out approach, but it has to be driven by the business strategy. The way to determine "Have I been successful?" is, "Have I been successful in adopting my business strategy and meeting my business goals?" If I have, then I am doing the right things.

Every enterprise is going to vary in the extent to which IT contributes to those goals. For some organizations, IT may be a strategic asset. There may be lots of specializations that do what I would call a vertical domain that makes sense to them.

For another organization, IT may not be so much of a strategic asset, and they just use it for the standard, horizontal features of HR and business support services.

The best thing for them may be to go down an outsourcing route with a company, saying, “Okay, make sure you are able to keep up with what we need by adopting SOA on your end. But that’s really a part of you being a good business, not necessarily our being a good business.”

It all comes back to what the business is trying to do, and to try to understand how IT can contribute to that solution. If I don’t have any idea on how IT contributes, I am never going to be able to say I was successful or not.

Biske: I think we focused a lot on organizational resistance today, but that’s not to say that there isn’t a lot of success out there in the marketplace right now.

Where you see that success is in telecom and in financial services. Financial services, of course, because they have the money and they are always first, but also because you are talking about a relatively heterogeneous array of services that they can create, recombine and put together into different products. The market demands that they come up with a very broad variety of products that they can deliver to their customers. They are seeing that agility quicker than anybody else.

Gardner: A mega trend that's with us these days, but we didn’t bring up yet is globalization. Companies are competing in ways that they never had to before. So perhaps competition, the ability to compete and win markets and outflank your direct competitors and partners efficiently, and to do mergers and acquisitions well because your IT department can keep up with the business strategies -- perhaps these are the big payoffs from SOA.

Perhaps we'll we see companies effectively embrace what we’ve talked about today, make agility a de facto means through which IT performs at the pace of business. And then they become big companies, get bigger and better, take over more customers, deliver better services, partner across a larger ecology, become masters because they are at the forefront of their markets, and other players become slaves.

Or, am I being a little bit too loose? What do you think, Tony?

Baer: In this thing you were talking about -- globalization, M&A scenarios -- sometimes circumstances have a nice little way of concentrating the mind.

When you all of a sudden are faced with putting two organizations together, which happens pretty often in the business -- M&A is not exactly the exception these days. At some point you have to say, "Look, we need to take an architectural approach."

"Our tried and true methods have been tried and they are true, but they may not be valuable. We keep just going back on our traditional way, our traditional path of execution, and we're just going to develop ourselves into a brick wall."

Gardner: Eric, do you really think that if you are a successful SOA company, you are going to just drop the SOA and just say, “We’re a successful company?”

Knorr: A successful SOA company as what?

Gardner: As someone who executes well on what we have been discussing -- SOA. Does that really make you a successful company?

Knorr: Absolutely. It can contribute to it in terms of agility. There's no question about that. I can’t imagine somebody hanging out their shingle as an SOA company and having trouble getting over that one.

Gold-Bernstein: You asked when a company can say they are successful? In my view, every SOA project needs to contribute to the benefit of the business. It's not down the road five years. Everything you do needs to show benefit, and incrementally. There are different styles of SOA.

We talked about mashups. There is interactive SOA and event-driven SOA. So you are monitoring things and you are giving business intelligence. There is process-driven SOA, with which I'm optimizing my business processes or I'm using a horizontal business process and reusing what I already have.

So I may be building my architecture incrementally, based on different business problems. It's just the approach I'm taking to give more agility. All along the way, to be successful at all, you have to deliver business value for every single project. I don’t think you can wait at all.

Gardner: Okay, before we go to questions from the audience, Todd, for an IT department that can go to their business leadership and say, "You tell us what you want us to do and we will help you do it," versus one that says, "Get in line and wait, give us a list of requirements, and we will get back to you" -- which one is going to be around in five years?

Biske: I don’t know that either of those would be around in five years. We're talking internal IT. I don’t like the notion of a customer-supplier relationship.

It has to be a partnership. So it's not that IT comes to the business, or the business comes to IT. IT is part of the business. And they all sit down at the table together and have equal discussions on what's the right thing from a strategic point of view for that business.

If ever it's the case of just me going and saying, “Give me your requirements, and I will build what you need" ... that’s like saying, "Why don’t you go ahead and outsource me, because someone else can come in and ask you that same question and probably leverage economies of scale better than I can."

If it's the case of "it's pushing too far," you're not creating that shared understanding of the technologies involved to really enable the business to contribute. It has to go in both directions, you have to mutually understand -- IT has to understand the business better, as well as the business side has to understand technology better.

Gardner: Let's take some questions from the audience. This one is, “SOA can’t exist without governance, and there's been a lot of discussion about technical reference architectures. Where are the governance reference models? Are we there yet with governance? Do we have something we can point to and say, 'That’s the way you do it,' and if not, why not?”

Biske: I'll jump in on that one. Working for a consultant firm, obviously we come in and help with governance. It's interesting that we heard "technical reference architecture," and then "governance reference architecture." But I actually view the reference architecture as part of governance. I like to simplify governance to three simple things: people, policies, and process.

First, you have to have some level of authority to put policies in place. If no one recognizes any authority to establish policies, they're not going to be successful. So that should be enterprise architecture or something. Certainly, at an architectural level, you would expect reference architecture material to come from enterprise architecture as the authoritative source.

The reference architecture itself now is an expression of the policies associated with architecture. I have got something concrete. Later, you are using the style, saying, "must," "must not," "should," "should not," but that’s giving exclusive guidance, creating the policies that now the development projects have to follow.

Finally, you have to have process that goes along with that. So, as Beth pointed out, I don’t want to create a bunch of dictionaries that just sit on the shelf and gather dust. I have to have the process to figure out how I actually get people to follow these policies. It’s unlikely that you're going to be able take a strong-arm view, create your police force and just have your key checkpoints where the law is laid down.

Probably it's going to come back with a lot of resistance from your developers, unless your culture is already used to operating in that manner, which, I suspect, most companies are not.

You need to create transparency. You have to have involved with the establishment of the policies people who are also the ones that work with the projects on a day-to-day basis, so there's a feedback loop from the trenches, as well as guidance from above.

You need transparency into the activities that are going on as they occur, versus sitting back, waiting eight weeks to hit the architecture checkpoint, and when it's too costly to make changes, and say "Oh, you're not doing it according to the reference architecture."

You want to have that constant communication, transparency on both sides into the reference architecture development, as well as the development of the specific solution architectures, and everybody really works harmoniously. Its not going to happen overnight, but you always have to consider your consumers.

Gold-Bernstein: Can I add one thing, Todd? I agree. One other thing you need is management, because in SOA it’s dynamically binding. You don’t know whether the policies or the SOA’s are being delivered upon. You need real-time management and visibility, and automated management. So, if something is out of governance, it’s out of policy that is reported on, and you have procedures there to act upon it.

Those are becoming very important, and the thing is that people aren’t adopting them until they’re way down the road. In the beginning of SOA, you have to begin your governance, it has to develop alongside your architecture from the very beginning.

Gardner: So this is clearly another topic for another day: management and governance, do or don’t they come together?

Here is another question: "There are continuing references to semantic data. Two approaches to adding semantic information to data include Resource Description Framework (RDF) and Topic Maps. Any thoughts on RDF and Topic Maps?"

Baer: I think its too early, frankly. I mean, at this point it’s kind of "chicken and the egg." Very often, you’ll have vendor product come out, and then standards will then follow. I don’t mean to make this sound like this is vendor-driven, but in the area of semantic integration of services, there are a handful of products out there and maybe a handful of people actually working with this at this point. So, my sense is it’s too early to call.

Biske: RDF has one advantage right now in that, there are some close ties between that and REST, and certainly REST is continuing to gain in mindshare. I'd like to describe REST as more resource-orientated architecture than service-oriented architecture, but again that’s a debate for another podcast.

If you take this resource-oriented view, clearly RDF fits very nicely into that. But again, those technologies are still just coming out of the incubation stage. How to properly apply that in an enterprise context is still quite a ways off.

Gardner: And, as an indicator of the interest on this topic of semantics, another semantic question, "How far are organizations in their internal enterprise semantic model activities, and what is the extent of adoption?"

Beth, I think, you said it’s something on the order of 80-90 percent, and you had some percentage of activities devoted to semantic issues?

Gold-Bernstein: Oh, no! What I said was that’s the budget of an integration solving semantic issues, but they are doing it manually, re-solving that every time they hook something up. It’s a huge problem, but as far as solving it at a semantic level with semantic metadata and tools automatically doing it, we’re just not there.

Gardner: So your answer to the question of the extent of adoption is "relatively low."

Gold-Bernstein: Yes. It’s not even on the map.

Knorr: And it’s one of the oldest, ugliest problems within IT.

Gold-Bernstein: Absolutely.

Gardner: And we’ve heard that the data issues need to get worked out before many of the other benefits of SOA can be.

Biske: If you're going to have composite applications in the enterprise, and they're tapping into data stores that contradict each other, it’s not going to work.

Gardner: So get your data and semantic acts together.

Biske: Where we do see a little bit of effort happening, and it's wrong to necessarily call it semantics, is in increased adoption of vertical standards, a set of XML tags for a particular vertical domain.

Is that really semantics? Probably in the purest sense. Is it a step in the right direction? Yes.

If you're trying to say, “How do I represent my messages on my services in a way that’s consistent," you certainly can’t go wrong with starting with an industry-specific model. Is that the full way to leverage semantic technologies? No. You are a long way from that, but it's a step in the right direction.

Gardner: It seems to me that if you want to carve out a leadership position in your vertical, that you will take on the heavy lifting of semantics, and then extend it across your ecology.

Gold-Bernstein: But it doesn’t solve the problem for all of those packaged applications, home-grown applications, and everything else you are trying to reuse and integrate with. So, that’s the real semantic problem.

Gardner: Okay, last question, we’re out of time. "We talked about product-based versus project-based cultures. We have a plethora of products and enterprises, they have to continuously evaluate and determine the right fit. So, this is saying, 'We have a lot of product strategy activities, but if we productize services, won’t that result in a similar world of confusion?' And if we can’t even decide on what products to take to market and when, how can we decide which services are appropriate in order to allow us to then fight over which products to take to market?"

Biske: Let me make one quick answer to that, and let everybody else jump on me. By that logic, eBay should never have worked.

Gardner: Explain.

Biske: The whole idea of eBay and this marketplace of things that people are selling, they are selling probably new products. How are you going to make sense of it? How are you going to find it?

Somehow, eBay has put together mechanisms that are partially based on timeliness. There's some very good semantic integration and very good metadata management. Somehow, they put together what should otherwise, by conventionalism, be an impossible task.

In an enterprise, the process isn't easy, but the scope of the problem is going to be a little more containable than eBay.

Gardner: I hear another mega trend here, and that is social networks and the wisdom of crowds applied to services and products with governance, so that we have somewhat of a free-market approach that allows the wisdom to rise to the top?

Biske: I'd actually turn it around a little bit. The original question was part of the reason why we have all this problem in choosing products is that we didn’t have a product-based view to begin with. We didn’t have a capability-based view of, "These are the capabilities I need. Let’s go find the right thing to fit that." Instead we said, "Let’s go pick a product, and now look at what capabilities it gave us."

If you begin with this capability-driven view, now the products just naturally fit, whether they are internally developed, purchased externally. It creates the opportunity for more of a marketplace, leveraging all the conversations about it that the social networks may create for evaluating and selecting things appropriately, whether its internal or external.

I think we should have the same conversations about internal service providers and the quality of service they provide that we have with external providers.

Gardner: Well, we will have to leave it there. Thanks, you’ve been listening to BriefingsDirect SOA Insights Edition.

I want to thank our panel in a live presentation before the Open Group Architecture Practitioners Conference. We’ve had Eric Knorr, executive editor-at-large at InfoWorld; Tony Baer, principal at onStrategies; Todd Biske, principal architect at MomentumSI, and Beth Gold-Bernstein, vice president of ebizQ’s Learning Center.

I'm Dana Gardner, your host and moderator, principal analyst at Interarbor Solutions. Thanks very much for listening.

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Transcript of Dana Gardner’s BriefingsDirect Podcast on The Future of SOA. Copyright Interarbor Solutions, LLC, 2005-2007. All rights reserved.