Management Strategies

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Nancy Feig
Nancy Feig
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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.

BofA Seeks Competitive Advantage

While National City tapped SOA to cut costs, Bank of America ($1.4 trillion in assets), one of the financial services industry's biggest users of SOA technology, has a very different business driver. "We do SOA because it enables our businesses to be more competitive," says Bill Conroy, head of enterprise architecture for the Charlotte, N.C.-based bank.

Conroy, who owns the bank's entire architecture program, asserts that Bank of America is not using SOA to increase revenue, but rather for integration and to drive standardization. But that doesn't mean that SOA isn't saving the bank a lot of money.

"We're an acquisitional bank," Conroy says, noting that Bank of America has acquired close to 300 banks. When Bank of America acquires a bank, he adds, it typically does the "technical due diligence" required to migrate the acquired bank to its systems. However, it's not always a case of clear migration. With the acquisition of MBNA in 2005, for example, Bank of America transferred its accounts to MBNA platforms, Conroy notes.

SOA really shows its value, Conroy suggests, when the bank decides to combine its systems with the acquisition's systems. For instance, Bank of America will turn some of recently acquired Countrywide Financial's applications into services so they can be reused by the entire bank, he reports.

"We're really a leader because we don't follow the hype of SOA," Conroy says. "We are pragmatic about it. We have a very strong executional focus and had a strong business case."

Conroy contends that his banking industry peers are having a hard time rolling out SOA because they don't have a handle on exactly why they are doing it. "We had to do a lot of prep work," he recalls. "We spent a lot of time getting the foundational stuff in place."

According to Conroy, Bank of America has been utilizing SOA principles since its early incarnation as Common Object Request Broker Architecture (CORBA). "Each of the new technologies is making it easier to accomplish," he says.

In late April, SAP announced that Bank of America had chosen SAP Enterprise Resource Planning (ERP) to further integrate its internal financial reporting systems. However, this does not mean that Bank of America runs a complete SAP shop, Conroy stresses. In fact, he says, he's somewhat skeptical of the motives behind the BIAN group. "They are trying to get you on their metadata model," Conroy contends.

"Once you're on a data model, it's hard to get off," he continues. "It helps, but it locks you in. You end up being an integration house between vendors."

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