Value creation from IS Integration: From ASP to Web Services?. Wendy.L.Currie Warwick Business School Presentation at ESRC Seminar – Nottingham University Business School, UK June 2004. Overview. EPSRC and ESRC Funded Research Project 2000-2004 The ASP market - A Flawed e-business model?
Warwick Business School
ESRC Seminar – Nottingham University Business School, UK
“An ASP manages and delivers application capabilities to multiple entities from data centres across a wide area network (WAN)”.
ASP Industry Consortium
Ecosystem For Hosted Applications Services?
$24 Billion by 2005
$18 Billion by 2005
Gartner Group, 2001
$23 Billion by 2003
$22.7 Billion by 2003
$19.2 Billion by 2003
Yankee Group, 2000
Traditional Outsourcing Services?
Software licence owned by the customer
Software licence owned by the vendor
One to one relationship between vendor and customer
One to many relationship between vendor and customers
Legacy software application paid for by customer
No up-front costs to customer
Price based upon s/w license and maintenance
Price based upon usage
Software as a product
Software as a service
S/W application located at customer site
S/W application located at supplier siteA comparison of traditional and application outsourcing
Full Service Providers (FSPs)
(J.D.Edwards, SAP, Corio, Aristasoft)
Commodity ASP Services?
One-to-many – point solution
Economies of Scale
Efficiency (of business applications)
Individual performance improvement
Utility pricing models
Packaged ‘Stand-alone’ applications
Remote C/V relationship
Service Level Agreement (SLA)
Technology peripheral to core business
Many-to-many - Enterprise-wide
Economies of Scale and Scope
Adaptiveness (to business change)
Multiple, fluctuating pricing models
Component based applications
Synergy of combination of applications
Loosely-coupled C/V relationship
Business process outsourcing
Changing Industry/market dynamics
Mixed technology portfolio
Synergistic (more than the sum of the parts)ASP and Web Services
‘Web Services are loosely coupled software components delivered over Internet standard technologies. A Web Service represents a business function or business service and can be accessed by another application…over public networks using generally available protocols..’ (IDC, 2001).
Phases of Web Services Adoption
Source: Marks and Werrell, 2003
Four different systems that could not connect with each other
Excel spread sheets and paper based deal tickets
Part of a group that employed 22,000. The 120 users managed corporate pension plans, private clients and wealthy individual investors. Twelve dealers.
Thirty employees, the four fund managers also dealt their own trades.
Windows NT, LAN and WAN. All Oracle and SQLServer database systems in US
Windows XP. SQLServer database
Expert DBA, network teams, 24hr help desk, in-house training
No expert IT skills
Over 20 at its peak (1 external)
2 core people (both external)
Accounts and Positions
15,000 accounts: 250,000 positions
25 accounts, 2,500 positions
Unit Trusts (10%)
Money Market (10%)
Foreign Exchange (10%)
Time to implement
Value Added Web Services Services?
Internet and Intranet