The worst CIO misunderstanding about service-oriented architecture (SOA) is thinking of it as \n\nonly another technical initiative for software reuse. Although SOA's reuse potential is real and good, its business impact goes much further: In Forrester \n\nsurveys, 38 percent of Global 2000 SOA users say they are using it for strategic business transformation. SOA's true source of power is in its business \n\ndesign models, not its technology \u2014 and this means that SOA provides a broad foundation for a much larger shift in business technology (BT) \n\narchitecture that goes far beyond SOA itself. By correctly understanding SOA, CIOs can lead their organizations on a solid and well-managed path \n\ntoward a strategic technology future and greater business value.[CIO.com's resident expert Dan Rosanova dives deep and provides expert advice and analysis about SOA in his blog SOA Advisor]Forrester defines SOA as a business-focused approach to solution design and software architecture. By providing open, flexible access to the \n\nbusiness capabilities and transactions buried within an organization's applications, SOA makes it easier to adapt existing software to new business \n\nrequirements. CIOs who think of SOA merely from a technology perspective will miss this business view of SOA, and they'll miss an opportunity to lead \n\ntheir organizations forward. SOA is the foundation of a much broader shift in the future of business-focused IT architecture, which means that those who \n\nget SOA wrong will have a poor business foundation for many years to come.Sixty-eight percent of enterprises say they are using SOA or will be using it by the end of 2010. Fifty-six percent are using SOA now, and that \n\nnumber jumps to 74 percent when considering only Global 2000 organizations. All this SOA usage is not just industry hype and experimentation, either. \n\nSOA has been delivering tangible results that make IT executives want more of it: 52 percent of current enterprise SOA users say it has delivered \n\nenough benefit that they plan to expand its use, while only 1 percent of SOA users say they are cutting back on SOA because they see little or no \n\nbenefit. For the rest, it's either too early to tell or they are struggling to get the benefits \u2014 often because they approach it as only a \n\ntechnology.SOA Definition and SolutionsThe key points CIOs must understand about SOA are:\u2022 SOA aligns your software with your business. While it is true that SOA is fundamentally an approach to software architecture and \n\ndesign, which makes it sound tech-oriented, the most important SOA concept is to design software around the business capabilities you need to run \n\nyour organization. Each SOA-based business service performs a complete business unit of work, hiding the complexity of your IT applications behind a \n\npluggable digital software interface for a specific, targeted business capability such as "submit order" or "distribute sales lead."\u2022 SOA creates a portfolio of business capabilities. By designing for the business capabilities your organization needs, a \n\nbusiness-oriented approach to SOA creates a coherent portfolio of business services that directly reflect the design of your organization's major business \n\ntransactions and processes. These services build upon and leverage your existing base of siloed and overlapping applications, insulating your business \n\nfrom the existing complexity by providing a service layer where business alignment is built directly into your software.\u2022 SOA brings business capabilities where they are needed. With a portfolio of SOA business services, your organization can quickly \n\nconnect your business capabilities to any business process, employee, customer, partner, supplier, government entity, mobile device, or anything else as \n\nneeded to adapt to changing business conditions and implement business improvements.There's more: SOA's business services provide a foundation for further innovation and business optimization. Four examples include:\u2022 BPM for business responsiveness. Business process management (BPM) and \n\nbusiness activity monitoring (BAM) solutions can use the business data flowing through your SOA services for business visibility and rapid \n\nresponse.\u2022 Event processing for early warning. Event processing solutions can identify patterns in business service flows to provide early \n\nwarning for potential business problems.\u2022 Predictive analytics for action that anticipates future problems. Predictive analytics can operate over near-real-time flows of data \n\nfrom your SOA services or data services, or from event streams flowing through SOA infrastructure to event-processing solutions, to predict future \n\nbusiness problems from patterns that emerge from mathematical modeling of system behavior.\u2022 Rules and policy for business flexibility. Business rules and policy management technologies can provide the means to quickly adapt \n\nthe operation of the digital business represented by your business services.There is benefit in SOA itself, and there is further benefit in the foundation for business process intelligence and adaptability that SOA provides. It is \n\nnot simply about using SOA together with other technologies: Unless SOA is the foundation of a larger architectural vision, adding on other technologies \n\nonly creates more technology integration issues. Building on top of SOA, Forrester integrated vision for Business Capability Architecture, Digital \n\nBusiness Architecture, Dynamic Business Applications, and more embody a future where the architecture of your solutions matches the design of your \n\nbusiness. SOA is the foundation for achieving a broader strategic future.Randy Heffner is a Vice President at Forrester Research, serving Enterprise Architecture professionals. He is a leading expert on architectures \n\nand design approaches for building enterprise applications that are secure and resilient in the face of continuous business and technology \n\nchange.