Web services should deliver much more than EDI for small businesses. Put Web services on your radar Web services should deliver much more than EDI for small businesses.
It has often been said that hindsight is 20/20. But, for small-business leaders, having clear foresight is also vital for survival. This means keeping a keen eye on emerging technologies and how they might help your company.
One good example of this is Linux and open-source technologies. Just a few years ago, these solutions and the practices behind them were considered bleeding edge. Today, Linux has gained nearly 30 percent of server market share (according to IDC) as business and technology leaders have recognized its quality and potential to save them money. Small businesses that kept an eye on these technologies and adopted them when appropriate have reaped economic benefits.
So what should be on your radar now? One key strategy to keep an eye on is Web services. In the coming months, you’ll hear plenty about this up-and-coming technology. Let’s take a look at what it is and why it’s important for small businesses.
You might think of Web Services as part of the next generation of Internet technologies. Today, we use the Web (and the Internet infrastructure) to view content on Web sites, exchange information, and to buy and sell. In most cases, this involves human interaction.
Web services will give business applications the “smarts” they need to leverage the Web for connectivity with other business application–whether local or halfway around the world. The application components that make up a business process (e.g., procurement) will be able to interact with business-partner application components using a publish/subscribe type of metaphor, Web connectivity, and open standards for data exchange.
Let’s look at an example of how Web services might change (and improve) things for small businesses. Suppose you own and operate a bike shop. Today, you might phone or fax a supplier to order bike parts, or you might visit the supplier’s Web site. With Web services, the applications you use to track inventory would gain enough smarts to know that you were low on bike parts. At an application level (non-human), your software would leverage the Web to securely access your supplier’s application and place the order.
This approach is similar to methods we’ve tried in the past, such as Electronic Data Interchange (EDI), except it would be an improvement. Under EDI, we use proprietary data formats and private network connections to perform similar functions. Small businesses have a hard time complying with the requirements of EDI, which calls for many resources to support the creation of EDI documents and integrate them with business applications. In short, EDI works for larger companies, but is a real pain for smaller businesses.
Web services promises to level the playing field. The technology uses standard Web-based communication and standard data formats to support application-level interaction.
Of course, there are still some challenges to overcome before Web Services can fulfill the promise of reducing business-to-business transaction costs–a big one is the myriad of standards vying to become the norm for this emerging technology. Another is the relative dearth of tools yet available to begin implementing Web Services. This situation, however, should change over the next 18 to 24 months.
In particular, keep an eye on the emerging ebXML standard. (See Nelson King’s recent column about ebXML.) Recently approved, it leverages truly open standards to support secure application-level data exchange. ebXML is being developed on a global basis with the support of many groups around the world, including the technology wing of the United Nations.
You will hear plenty about other standards being developed, such as Simple Object Access Protocol (SOAP) or Universal Description, Discovery, and Integration (UDDI). Many of those working on SOAP and UDDI are also working on ebXML. Be wary of SOAP and UDDI, however, as these standards leverage extensions to proprietary technologies.
I believe ebXML will win out in the long term. Watch for tools and techniques that leverage this emerging standard. Talk to your business partners about how they will leverage Web services. Clear foresight and planning now will yield lower costs as Web services becomes the norm for business-to-business interactions in the future.
Contributing Editor Maggie Biggs has more than 15 years of business and IT experience in the financial sector.