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Pursuing the Promise of SOA

Though service-oriented architectures have the potential to improve IT integration and business agility, the lack of standards is hindering widespread adoption of the strategy in banking. But that's not stopping some institutions from pursuing the promise of SOA.

National City Enjoys Early SOA Success

The lack of standards, however, didn't stop Cleveland-based National City Bank ($153 billion in assets) from pursuing the promise of SOA. An SOA early adopter, National City first deployed SOA more than four years ago. So what has changed since the original implementation? "Decentralization," says Joseph McCartin, National City's CIO.

The driver behind National City's initial foray into SOA was core renewal, McCartin relates. The bank was looking for better customer relationships through a single view of the customer, but wanted to achieve those goals without replacing its core system, he explains. "We worked it like a job, ... and SOA was the game plan," McCartin says.

According to McCartin, a common mistake banks often make is labeling SOA as a technology approach; it's really about governance and rights, he asserts. "It's a governance story," McCartin says, noting that National City turned to BEA Systems, which is now part of Oracle (Redwood Shores, Calif.), for advice on SOA governance and management. "Lots of people say they are doing [SOA], but it's really a hobbyist project [for them]," he adds.

"You have to say, 'This is an enterprise service,'" McCartin continues. To accomplish this, "We had to create a common services group -- we had to create an asset lifecycle group."

As an extension of this approach, McCartin relates, the bank ran its SOA as a centralized initiative for the first few years. It maintained a group of services that resided in a common services area, from which businesses, or portfolios, throughout the bank could tap the services they needed. But the bank moved to a decentralized SOA model about a year ago, he says, adding that now employees in any line of business can create a service and house it in the common services area.

"It's an evolutionary step for us," McCartin says. "We have a good enough architecture; we are now getting a lot more scale because we are decentralizing. A mistake I've seen is [banks] have gone to the decentralized model right off the bat because everyone wants to play with this -- 18 months later, they find they have no reuse."

McCartin says that each of National City's enterprise services is used by an average of 3.1 applications. "We have a pro forma [mandate] to more than double that over the next 12 months," he notes, pointing out that the results of National City's SOA transformation exceeded expectations.

"We avoided $20 million in build by reusing [services] for last year alone," McCartin reports. "[We saved] $16 million the year before. That's cost avoidance. That's very representative of real savings."

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