How Will Web Services Ultimately Change Business?

Web services has been a long time coming, and it will be a while before it arrives, at least with the standards that are needed for the technology to live up to its promise (see “The Battle for Web Services,” www.cio.com/printlinks). But the day will definitely come when computers conduct what CIO Executive Editor Christopher Koch describes as “deep, meaningful interactions with no human intervention.” Shortly thereafter, automated machines will be capable of not just telling each other what to do, but figuring out how to do it, and doing it, using computer code, human proteins or both.

Now consider that for much of the past 20 years, every serious company on the planet has been hiring thousands of a relatively new kind of professional worker whose job has been to “intervene” with computers in many of the same ways that will soon be usurped by computers themselves. Those humans have done more than support the technology needed to pursue new business strategies; they have changed the culture of business, and they boosted the role of the CIO from backroom geek to, in many companies, an important member of the board of directors.

It may seem simplistic to suggest that when Web services and automated machines hit their stride, there will be a lot fewer humans in the IT department and corporate culture will change again, in ways larger than we think. But according to speakers at the Symposium on the Coevolution of Technology-Business Innovations, held this fall at IBM’s Almaden Research Center, the long-term potential of new technologies is often very different from what we first imagine. For example, speaker Hal Varian, economics professor at the University of California at Berkeley, reminded the audience that radio was considered a new way for ship captains to communicate with colleagues on shore. And it was that. But today, that’s a footnote in the evolution of radio from technological wonder to world-changing industry.

Could Web services, now seen as a new way for computers to communicate, follow a similarly strange path? Or will it just shave a few bucks off your IT budget? How will your business change when computers do what your staff does today?

Sound Off is a weekly online column about current IT-related issues. Web Editorial Director Art Jahnke (ajahnke@ cio.com) always welcomes feedback.

What drives history: technology or social changes? Some researchers can trace the feminist movement back to the invention of the bicycle. Technological innovation drives social changes in ways that are normally unforeseen. The movement of the wife from home and mother role into the working world would have been impossible without many of innovations; and the social changes that resulted have contributed to the needs fulfilled by other technologies, such as the cell phone.

Unfortunately, I am beginning to hear much fear regarding the future of humans in the workplace. People are required now to do tasks that computers, robots and other machinery cannot do. Much hype has gone into artificial intelligence as being a medium that will reduce the cost of decision making. This AI must rest on a ubiquitous system-to-system communications protocol?which Web services is purported to provide. However, the development of business strategy and the creation of markets and customer desire require an emotional attachment of the customer to the product. Until machinery can “think like a human”?that is, until computing machinery can develop a humanlike emotional approach to solving many problems?computing cannot replace all of the human beings in any business organization.

Daniel C. Ashley

CIO, Eastern Municipal Water District

Web services won’t replace core, mission-critical applications in the heart of financial institutions for the foreseeable future. Web services may provide certain specialist peripheral functions. But no self-respecting CIO is going to totally rely on the service levels and predictability of an unknown set of Web services providers, with their ugly response time latencies compared with traditional in-house online transaction processing applications. We have been trying to get standards implemented in our industries for years, starting with traditional EDI decades ago, and now we struggle with four competing Web services standards pushed by vendors whose commercial interests overrule the goal of common standards. I predict that Web services will find a small niche in application portfolios but never relieve organizations of their core custodial responsibilities to store and maintain corporate data in-house with controlled secure user interfaces. Web services is hardly the panacea it is purported to be. It’s currently slow, expensive to integrate, uglier to understand. It’s useful for weather, stock prices and commodity product quotes, but that is hardly core or revolutionary.

Rodney Griffin

Executive Director

Product Marketing and Management

WorldGroup Consulting

Web services provides nice tools, not magic.

Web services is supposed to make it easier to interface systems. This should cut costs. However, at small and midsize firms that I’ve been working with lately, the conversion to Web services has been more difficult and more expensive than expected. Those companies also experienced a maintenance cost for the interfaces that was almost identical to the point-to-point interfaces that they had been using. The reason is simple: Most of the labor in maintaining interfaces is not in computer programming. I found that 80 percent of the maintenance labor is in specifications, problem determination, human interaction?areas that Web services doesn’t exist. Of the technical work that Web services does affect, it reduces costs in only the most technical, heads-down programming.

So, given that research, I think Web services will be increasingly implemented in the small and midsize companies, primarily as Web services is incorporated into vendor-supplied packages such as Oracle Financials, SAP, Maximo and so on.

Dean Cashley

Associate Professor

College of the Canyons

Web services has the capability to replace human work efforts in areas where common (or nearly common) business processes exist between businesses. Take, for example, all of the human effort involved in the supply chain, from purchase order generation through payment. While this area has already been mostly automated within businesses, B2B process automation is still in its infancy, and this is where the greatest labor effort remains. But management decision making will remain a human endeavor.

Dave Minnich

IT Governance Manager

SKF USA