the future of home lending
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The Future of Home Lending
Business Process Management and the Service-oriented Architecture
Dain Ehring, CEORobert Carpenter, PhD, CTO
MBAA’s National Technology in Mortgage Banking Conference & Expo
March 16, 2004
National Technology in Mortgage Banking Conf & Expo Page 204/10/23
AgendaAgenda
Business Process Management Overview & history Characteristics Operating benefits
Services-oriented Architecture Characteristics Operating benefits Technology view
BPM + SOA = BPMS Mortgage drivers Reference implementation
Business Impact Moving from Good to Great
Summary
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Business Process ManagementBusiness Process Management
Business processes define a company Critical source of competitive advantage and market
differentiation Very complex, constantly evolving Aligns processes more directly with organizational
objectives
The “ideal” BPM solution Connects to any system associated with the process Blurs organizational boundaries Supports compliance Monitors process status with eye toward continuous
improvement
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Providers and Suppliers Providers and Suppliers
Come from four areas: Traditional workflow & content management vendors Business process engine companies Middleware providers extending application integration Vertically focused software & service providers
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Business Process Management (BPM)Business Process Management (BPM)
Management Theory Modern Technologies+ = BPM
Total quality management
Six Sigma
Business engineering
General systems thinking
Application development
Systems integration
Vertical market focus
Service-oriented Architecture
Workflow
Transaction management
XML and Web services
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Some BPM History…Some BPM History…
1980’s = Business Process Reengineering (BPR) Design a simpler process, implement through a one-time organizational
change; re-do the factory flow• Benefit
– Improved performance within the enterprise• Problems
– Failed to provide agility, support ongoing change, or combine processes with partners
1990’s = Enterprise Resource Planning (ERP) Ingrained best practices in huge software applications
• Emerged from MRP in late 80’s• More inflexible• Didn’t facilitate integration of business partners into processes • Focused mainly on manufacturing & finance only• Never really was “enterprise”
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Today Today
BPM goals
End-to-end multi-company business processes built to adapt and enable outcome-focused solutions to problems
Share business processes across the enterprise, and with partners, to bring ultimate value to customers
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BPM Characteristics BPM Characteristics
Closed loop, changeable processes Companies can make changes based on the process,
implement new workflow, analyze results, repeat• Self-correcting processes resolve business issues• No “baton drop”• Change is built-in• Unites business & technology/people & systems
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BPM BenefitsBPM Benefits
Improves business agility Enables a clearer division between IT & LOB
Clears up the sourcing “jigsaw puzzle” Whether or not to outsource…? Leads to determining commodity v. value-add application
development BPM enables control over the process, wherever it resides
Explodes technology stovepipes & silos Leads the way to end-to-end automation
Creates reusable process patterns Once model the process, can implement change rapidly
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The BPMS The BPMS
BPM + services-oriented architecture = the BPMS
What the BPMS does Model, deploy, and manage business processes across
applications, departments, business partners Works behind the firewall and over the Internet
BPMS requirements Extreme flexibility Reliability Security
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The Services-oriented Architecture The Services-oriented Architecture
Architectural foundation for BPM Extends processes beyond the company’s walls Combines best of component application engineering and
process engineering Combines business and technical systems to make
processes that flex and recombine More control over internal processes and more interaction
between internal processes and those of partners “Loosely coupled” approach enables dynamic changes to
processes
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Market ViewMarket View
“Software-as-service providers are rapidlyadopting XML-based Web services standardsboth to lower integration hurdles and to level the playing field against packaged software competitors”
- Summit Strategies
12/2003
“Your BPM initiative will benefit from
an enterprise model built on service-oriented architecture and web services”
- Ovum Research
3/2004
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Traditional ViewTraditional View
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Service-oriented Lending ArchitectureService-oriented Lending Architecture
SOA Reference Implementation
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Market Evolution Toward SOAMarket Evolution Toward SOA
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Before the Services-oriented ArchitectureBefore the Services-oriented Architecture
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The Services-oriented Architecture in LendingThe Services-oriented Architecture in Lending
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Business ImpactBusiness Impact
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SummarySummary
BPM is the future Consider a services-oriented architecture Adopt an evolutionary approach Long term value of software as services
• Rapid time-to-market• Less risk• Easier growth/evolution
The Future of Home Lending
Business Process Management and the Service-oriented Architecture
Dain Ehring, CEO, & Robert Carpenter, PhD, CTO
Q & A