1. E-Business and B2B Integration A Tutorial by Gurpur M. Prabhu

2. Copyright 2002 Gurpur M. Prabhu 2 Outline E-Business Nature of Business Activities Business Requests and Responses Requirements for Business Integration EAI vs. B2B XML RosettaNet, Web Services, BizTalk Summary

3. Copyright 2002 Gurpur M. Prabhu 3 What is E-Business? To some it means Web-enabled selling To some it means middleware To some it means Web application servers To some it means Web Services To many it is the force that is driving the fundamental restructuring of every industry

4. Copyright 2002 Gurpur M. Prabhu 4 E-Business The value of E-business is clear How to make it happen is less clear It demands a very different technology than current systems Current technology is developer-oriented What is needed is a business-oriented focus

5. Copyright 2002 Gurpur M. Prabhu 5 Event-Driven Paradigm E-business is event-driven An order event instantaneously triggers other events Every system affects every other system in real time Common business models are needed to determine the “path” of business events

6. Copyright 2002 Gurpur M. Prabhu 6 What is Integration? To some it means integration of data To some it means integration of applications ‘Seamless integration of business processes’ sounds like an IBM TV commercial No clear consensus on ‘integration’

7. Copyright 2002 Gurpur M. Prabhu 7 Nature of Business Integration A system should be able to communicate with other systems, automatically and expediently Is bound at both data and process levels Information exchange alone is not enough – business rules and processes also need to be mutually accommodated to process data

8. Copyright 2002 Gurpur M. Prabhu 8 Intelligence Needed Economic Benefit Business Activities Strategy Planning Marketing Making Requests Handling Requests Operational Improvement Speculation Assembly LineBook-keeping Inventory Control

9. Copyright 2002 Gurpur M. Prabhu 9 Nature of Requests User-InitiatedBusiness Event-Driven JIT Data gathering Special Standard RFQ Response RFQ Shipment Statistics Report Order Fulfillment

10. Copyright 2002 Gurpur M. Prabhu 10 Handling Incoming Requests LowHigh Decision Making Credit Payment Special Standard Purchase Order Account Balance Shipment Statistics Report

11. Copyright 2002 Gurpur M. Prabhu 11 Manufacturer Send RFQ To Supplier Send request To Shipper Make Decision Supplier ResponseShipper Response Example Process: Request For Quotation Time Business Message

12. Copyright 2002 Gurpur M. Prabhu 12 Example Process: RFQ (1) Manufacturer sends request to several suppliers Suppliers send responses back Mfr sends request to several shippers Shippers send responses back Mfr has to make decision based on various responses For Mfr, all business messages are part of a SINGLE business transaction

13. Copyright 2002 Gurpur M. Prabhu 13 Example Process: RFQ (2) Suppliers and shippers will have multiple business transactions with multiple manufacturers, all executing concurrently Time between response to mfr and order acknowledgment is critical All transactions are exposed to partial updates made by other concurrently executing transactions

14. Copyright 2002 Gurpur M. Prabhu 14 Variations in Responses Accept or Reject our request Alter our request Partially accept our request All the above with respect to one or more elements in our request

15. Copyright 2002 Gurpur M. Prabhu 15 Evaluating Responses Determine context of request Consider acceptable alternatives Determine relationships between elements in the request that affect partial acceptance Compare responses from different targets

16. Copyright 2002 Gurpur M. Prabhu 16 Critical Success Factors for BPI Ensuring that Business Process Integration is a business-driven approach Building a coalition that crosses functional and enterprise boundaries Utilizing technology that facilitates BPI collaboration and deployment

17. Copyright 2002 Gurpur M. Prabhu 17 Software Requirements:1 To be truly effective, a BPI product must incorporate all manual and automated steps within processes being integrated Triggering of processes or responses to process-driven requests must be incorporated into the web environment Should accommodate a dynamic level of responsiveness

18. Copyright 2002 Gurpur M. Prabhu 18 Software Requirements:2 Should accommodate internal and external processes including those of supplier environments, distribution chains, and customer domains Must be highly scalable Must manage processes end-to-end, allowing a series of processes to function in an uninterrupted manner

19. Copyright 2002 Gurpur M. Prabhu 19 Characteristics of any Solution Standard Solutions for: –Aspects such as communication, authentication, authorization Custom Solutions for: –Handling Special requests –Variations in decision making –Variations in processes –Handling implementation differences

20. Copyright 2002 Gurpur M. Prabhu 20 Consequences of customization Customization drives up the cost Comfort-zone IT budgets are 5 to 7% of sales revenue Large corporations have more revenues but also more establishments Customization cost can easily exceed 5% of sales revenue per establishment

21. Copyright 2002 Gurpur M. Prabhu 21 EAI vs. B2B Business drivers for Enterprise Application Integration (EAI) and B2B are different EAI deals with internal integration and must be highly structured and controlled B2B deals with external integration and must be open and fluid Much confusion results when proposing EAI solutions for B2B problems

22. Copyright 2002 Gurpur M. Prabhu 22 EAI Business Drivers Transaction focused End-to-end transaction completeness Reuse across systems Standardize and leverage objects/data across systems Flexibility to switch applications Real-time communications and message delivery

23. Copyright 2002 Gurpur M. Prabhu 23 Mfg MktingFin R&D CRM Supply Chain Spaghetti Integration ERP Supply Chain Web Legacy EAI B2B Internet Evolution of EAI Systems Enterprise Resource Planning systems were built without external integration in mind

24. Copyright 2002 Gurpur M. Prabhu 24 ERP Systems B2B integration implies seamless communication between existing systems and databases (yours and your trading partners’) But packaged applications such as SAP, Oracle Financials, and PeopleSoft – for example – were designed NOT to access anything outside their proprietary technology

25. Copyright 2002 Gurpur M. Prabhu 25 B2B Business Drivers Business Document focused End-to-end document completeness Reuse across trading partners Work with numerous data definitions and standards Flexibility to switch trading partners Communication and message delivery that fit partners’ capabilities

26. Copyright 2002 Gurpur M. Prabhu 26 Enterprise Inter-Enterprise Systems B2B XML Web Services RosettaNet ebXML BizTalk Customers Partners Suppliers EAI B2B

27. Copyright 2002 Gurpur M. Prabhu 27 Problems with Current B2B Solutions Cost and Time needed for customization very high Automatic solutions are not geared to work with the existing manual solutions Hence the requirement of a large install base is not being realized

28. Copyright 2002 Gurpur M. Prabhu 28 What is XML? eXtensible Markup Language Was never intended for information exchange...... But has now become a standard for data interchange XML’s real power is not the technology but the fact that it is an accepted standard

29. Copyright 2002 Gurpur M. Prabhu 29 XML Data Sales System Legacy System ERP System Web applications

30. Copyright 2002 Gurpur M. Prabhu 30 Example XML specification <customer> John Doe John Doe 125 125 111 Main St. 111 Main St. Anyville Anyville 11111 11111 </customer>

31. Copyright 2002 Gurpur M. Prabhu 31 What XML does Large chunks of information are consolidated into an XML document XML parsers extract data from XML documents XML is a simple format that provides metadata and information content Applications must be able to internalize and externalize XML information

32. Copyright 2002 Gurpur M. Prabhu 32 XML’s Contribution Facilitates the development of Standards Provides the ability to write programs that process document content However, this does not fully solve the B2B integration problem

33. Copyright 2002 Gurpur M. Prabhu 33 Trading Partners IBM RFQ GE RFQ XML API-based Middleware 1 2 N API calls pre-existing functions at data sources XML Document contains the specification of the RFQ Middleware calls functions for processing the data But EVERY data processing function must be implemented at EVERY data source If there are N trading partners, each one’s RFQ process must be implemented at N-1 data sources. To support a single process change for ONE partner, N-1 implementations must change – a maintenance nightmare. THE B2B PROBLEM Data Sources

34. Copyright 2002 Gurpur M. Prabhu 34 How is Data Accessed today By sending Requests (Using some distributed computing method such as RMI, COM, or CORBA) Needs pre-determined Semantics for the Request, the Response, and the Process that generates the Response Processes provide fixed functionality Both Requests and Responses need customization to integrate into user-side systems, and the data-side systems

35. Copyright 2002 Gurpur M. Prabhu 35 Semantic Content of Request and Response Mostly implied by pre-determined Semantics Requests do not have the expressive power to define dynamic requirements For the same information in the Request, and the same process, the content in the Response cannot be changed dynamically. XML helps automate processing of Requests and Responses, but cannot define the computing that needs to be performed

36. Copyright 2002 Gurpur M. Prabhu 36 Semantics of Database Process Description of the Selection of the dataset Description of the operations on each element in the dataset For the same semantics, the code to select the dataset, and the code to perform the operations, change from system to system Therefore, customized code that performs the same actions is needed for each data source

37. Copyright 2002 Gurpur M. Prabhu 37 Current Approach to Collaborative Enablement Accommodation Phase –Internal Requirement Definitions –Collaborative Process Definitions Agreements Phase –Business Operations to be covered –Computer Processes to implement –Documents to be exchanged

38. Copyright 2002 Gurpur M. Prabhu 38 Problems with Current Approach:1 Complicated Accommodation Phase –Involves complex negotiations with Trading Partners –Each organization will try to: Influence others to implement processes to allow their own Internal Requirements to be realized Minimize their efforts in implementing the functionality needed by external organizations

39. Copyright 2002 Gurpur M. Prabhu 39 Problems with Current Approach:2 Compromise-prone Agreements Phase –When the composition of the trading partners changes, agreements need to be re-negotiated –New agreements lead to complex maintenance issues –Inherently not an ideal solution – compromises and added (non-productive) work for all trading partners All these act as impediments to Collaborative Commerce

40. Copyright 2002 Gurpur M. Prabhu 40 Realizing XML’s Potential XML based Standards are just specifications – each system is expected to provide the implementation But can the ‘How’ (i.e., implementation) of the XML ‘What’ be the same on every system? Such an abstract Write-Once-Run- Anywhere programming model is needed to realize XML’s potential

41. Copyright 2002 Gurpur M. Prabhu 41 RosettaNet Defines standard processes and interfaces Develops common Partner Interface Processes (PIPs) Common agreement on “which processes do what and where” Focus is more on creating PIPs and less on any new technology

42. Copyright 2002 Gurpur M. Prabhu 42 Business Process Modeling Business Process Analysis Partner Interface Process Purpose: provide e-Business Interface Output: XML Docs + model + validation Dictionaries Implementation Framework RosettaNet Development Process

43. Copyright 2002 Gurpur M. Prabhu 43 Company A: Web Services Provider Registries UDDI, ebXML Company A Company A publishes its service to a Registry Company B queries the registry Company B: Web Services Customer If Company B determines that A’s service meets its requirement, it builds the interface necessary to connect its applications to A’s service. Potential Limitation: Every company needs an interface for every web Service that it wants to use. UDDI: Universal Description and Discovery of Information ebXML: Electronic Business XML WSDL: Web Services Description Language Web Services

44. Copyright 2002 Gurpur M. Prabhu 44 Technology Comparison XML Standard for Document Exchange Specification Oriented XML-parser helps understand request Data processing not done in document API middleware calls predefined functions Functions must exist at data source Difficult to extend process functionality RosettaNet Standards for common business processes Specification Oriented Partner Interface Processes Data Processing not done Implementations needed at data sources Difficult to extend process functionality BizTalk XML-based Document-centric BizTalk Server sends and Receives messages BizTalk Framework defines BizTags Microsoft is driving force No adapters available for BizTalk Server Web Services Publish-Discover-Bind paradigm Uses UDDI, ebXML, WSDL, SOAP Precise specification of service needed Functionality extensible but interface implementations needed for every service

45. Copyright 2002 Gurpur M. Prabhu 45 Summary XML not a panacea for B2B problem Business drivers and solution requirements for EAI and B2B are different All existing “solutions” are only partial Standardizing processes not the way to go Systems should be allowed to be different but yet made to look similar for B2B Semantic Bridge needed on data side