Experiences with SOA

1. Experiences with SOA Michaël Wittoek michael.wittoek@kbc.be

2. Agenda Introduction KBC Group ICT Experiences with SOA Questions & Answers

3. Agenda Introduction KBC Group ICT Experiences with SOA Questions & Answers

4. KBC Group • Ranking • One of the top 2 banks in Belgium • One of the top 3 insurers in Belgium • One of the top 20 banks in Europe • Top 3 financial group in Central Europe • Market share in Belgium • Banking : 20-25% • Insurance : 9% (non-life) 22% (life) • Head office in Brussels • 56.000 employees • Belgium: 20.000 • CEE: 30.000 • Rest of the world: 6.000 • 11.000.000 clients • Belgium : ca. 3 300 000 • CEE : ca. 6 900 000 • Rest of the world : ca. 800 000 • Net Profit 2007: 3 281 m euros (ROE : 18,5%)

5. The participations of KBC in Central Europe Slovenia(Financial participation) NLB (34%) NLB Vita (67%) Representatived via NLB: Bosnia, Macedonia Poland Kredyt Bank (80%) Warta (100%) Czech Republic ČSOB (98,58%) ČSOB Insurance (97%) Last evolution (2007): Romania: Romstal Leasing (99,34%), Bulgaria: DZI Insurance (85%+ public bid 15%) – EIBank (75%)* Serbia: A Banka (100%) – Senzal (100% *) – Hipobroker (100%) – Bastion (60%) Russia: Absolut Bank (95%) Latvia-Estonia-Lituania-Ukraine: BIC (51%) Slovakia ČSOB (97%) ČSOB Poist’ovna (98%) Hungary K&H Bank (100%) K&H Insurance (100%) * Not closed (10-2007)

6. ICT in a bank: boring or not?

7. Group ICT Your ICT, our business • Employees • Belgium: 1.930 KBC & 750 external consultants • Central Europe: 1.360 KBC • India: 250 Valuesource (100% daughter of KBC) • Services • Delivering end-to-end ICT solutions (software, hardware, service) • Maintenance of ICT solutions • Hosting services • Network & infrastructure management • Clients • KBC Group Belgium • KBC Group international • Other corporate clients in the Benelux (Orbay, IFB, …) • Turnover: € 800 mn

8. ICT infrastructure (Belgium only) 2 IBM Mainframes in CCM - 1 in CCL (+/- 19.500 Millionsof Instructions Per Second) 284 beschikbare Terabyte (284.000 Gb) 2 robots: 10.000 tapes, 180 Gb/tape 17.000.000 transactions/day 21.000 PC’s 3.600 portable PC’s 1.200 softwares 17 Terabyte NAS 2050 Unix servers (HP, SUN Solaris) 1500 Intel servers 320 Terabyte hard disk 2 robots: 8.500 tapes, tot 1 Tb/tape 10.500 network printers & multifunctionals KBC Datacenter is one of the largest in Belgium

9. The ICT offices Antwerpen Brugge Gent Hasselt Mechelen Roeselare Aalst Leuven Brussel Head officesData centersLocal offices

10. Agenda Introduction KBC Group ICT Experiences with SOA Questions & Answers

11. What’s in it for you? • This is our truth and nothing but our truth on SOA • If SOA is still a mystery to you and now you expect to see “the light” and the exact road ahead… • We’ll try to demystify • But there’s no unique recipe for SOA • If you believe in SOA and think to know the right approach • Our story could inspire you • But perhaps you can do it differently • If you don’t believe in SOA • Perhaps I’ll convince you • But it’s really not the aim

12. Content • Why SOA makes sense for KBC? • What is SOA for KBC? • Roadmap for SOA • The big picture • Integration frameworks as enablers • Method for SOA • Service Oriented Organisation in ICT • Fazed implementation • SOA experiences: • Migration of distribution channels to a multi-channel concept • Building an ASP for non-life assurances • Wrap up

13. Why SOA makes sense for KBC? • We used to see the whole picture: • All on 1 platform • Everyone using the same standard • Everything build on our own • Manageable In/Outsourcing ASP, BSP, … Technological rat race Merger … We could end up with a lot of pieces with which we have to do puzzles, but… • We wouldn’t know the full picture we’re aiming at • We wouldn’t know which pieces we want or have to use

14. Why SOA makes sense for KBC? • But then the world around her started changing… • Mergers of companies with similar or different activities • ASP – BSP (Insourcing & outsourcing at business or ICT level) • Off the shelf packages, Internet, Web services, … • …resulting in an ICT architecture • With a lot of interaction with external parties • Heterogeneous software, hardware, … • Where there are many “standards” on functional and technical level • And a lot of flavours of banking and assurances business models • But the same quality was still needed or even more! • Deliver the same of better services to our client • Regulations on EC level • Time to market and cost!

15. Why SOA makes sense for KBC? • So probably nothing different compared to other (financial) companies • Perhaps one extra issue…KBC Group • Several successful acquisitions in Central Europe • In parallel with the EU and € drive in Central Europe we are transforming gradually to one company with a delicate balance between • Localisation • Local regulations • Local market conditions • Big bang is too dangerous • Centralisation • Law looks at KBC Group as one company • Economy of scale • EU is becoming “one country”

16. Content • Why SOA makes sense for KBC? • What is SOA for KBC? • Roadmap for SOA • The big picture • Integration frameworks as enablers • Method for SOA • Service Oriented Organisation in ICT • Fazed implementation • SOA experiences: • Migration of distribution channels to a multi-channel concept • Building an ASP for non-life assurances • Wrap up

17. What is SOA for KBC?

18. What is SOA according to KBC? • SOA is just another example of a very general aim “staying in control…” • Your first lessons in programming? If you have 1000 lines of code you’d better start thinking of modular programming! • How do you tackle a huge problem? Split it up in smaller problems you can handle! • Divide et impera! • How do you manage a big team? By making fine agreements on who’s doing what! • “… and reaching the appropriate level of effectiveness and efficiency”

19. What is SOA according to KBC? • You have a service oriented architecture if you’re able to… • Create an overview of your complete external and internal application portfolio • And you can cluster them in several big blocks • And you can assign a list of service (= what the “thing” does for the others) to each of these big blocks • And you can combine these services into processes known by the business • Regardless of all technology used

20. What is SOA according to KBC? • SOA is not a technical concept • But: it is a way to achieve a manageable situation for all aspects of ICT: • Architecture describes the situation • Some aids, outside architecture, needed to achieve the situation: - frameworks- methods- organization- infrastructure

21. Content • Why SOA makes sense for KBC? • What is SOA for KBC? • Roadmap for SOA • The big picture • Integration frameworks as enablers • Method for SOA • Service Oriented Organisation in ICT • Fazed implementation • SOA experiences: • Migration of distribution channels to a multi-channel concept • Building an ASP for non-life assurances • Wrap up

22. Roadmap voor SOA

23. High level view on SOA-approach • We never had a big ICT change project called “KBC ICT goes SOA!” • SOA requires a multi dimensional approach. Such type of projects are very complex to manage, very difficult to absorb by your organisation • SOA is something you gradually learn and thus should be introduced step by step • Such type of projects tend to forget the real aim and start creating one on their own

24. High level view on SOA approachSteps & Principles Draw the big picture Challenge your ICT organisation with the real SOA target And keep reminding them of it! Introduce an adequate methodology/process Go step by step at the pace of real business cases Trigger Method Do it! Enable Reorganise Intensify Introduce adequate technology if you don’t have it yet Adopt your ICT organisation to the SOA target Adopt your ICT organisation to this methodology and technology Respect the absorption capacity of your organisation Learn of your mistakes.

25. High level view on SOA approachSteps & Principles Draw the big picture Challenge your ICT organisation with the real SOA target And keep reminding them of it! Trigger Introduce an adequate methodology/process Go step by step at the pace of real business cases Do it! Method Reorganise Enable Intensify Introduce adequate technology if you don’t have it yet Adopt your ICT organisation to the SOA target Adopt your ICT organisation to this methodology and technology Respect the absorption capacity of your organisation Learn of your mistakes.

26. Key succesfactoren ICT Gartner ICT strategie methodologie Develop Target Architecture Plan Solutions Strategy (Business View) Business Strategy 4 Conduct ICT Assessment and Gap Analysis Summarize Strategic Business Direction Develop ICT Direction Develop Management & Governance Processes Develop Migration Approach & Roadmap Develop Communications Plan and Obtain Broad Consensus 8 2 3 6 7 1 Delivery Strategy (ICT View) Develop Target Service Delivery Model Technology Trends 5

27. Business priorities in the banking world (Gartner Research) ICT: • Globalization: ASP • Frameworks • Packages • Re-useOutsourcing Business: • Globalization: BSP • Time to market • Process standardization • Costs-control

28. 3 Roll-model as patern DISTRIBUTION Corporates Retail Front Office Markets Securities Accounting Credits Risk Management In/excasso Insurances Factoring ... PRODUCT FACTORY COMPANY MANAGEMENT

29. Domain classification based on 3 roll-patern Distribution ERP Asset management Reinsurances Markets Non-life insurances ICT Savings Life insurances Niche products Trade Finance Leasing Credits Securities Audit & compliance Payments Accounting Risk Management Application infrastructure

30. Globalisation Centralproduct factories Local distribution Distribution Distribution Product Product Product Product Product Product Product Product Distribution Distribution Product Product Product Product Product Product Product Product

31. High level view on SOA approachSteps & Principles Draw the big picture Challenge your ICT organisation with the real SOA target And keep reminding them of it! Introduce an adequate methodology/process Go step by step at the pace of real business cases Trigger Method Do it! Enable Reorganise Intensify Introduce adequate technology if you don’t have it yet Adopt your ICT organisation to the SOA target Adopt your ICT organisation to this methodology and technology Respect the absorption capacity of your organisation Learn of your mistakes.

32. Enable integration frameworks • EAI • Synchronous • Asynchronous • Network Data Model • Information layers • Internationalisation

33. Integration Architecture…highlevel view Browser Browser Browser Browser Browser Browser Browser Browser Browser Browser Browser Browser WAS WAS WAS WAS Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Back End Central EAIbackbone Local WAS Local EAIbackbone

34. Synchronous EAI: Web Applicatie Servers: 3 Tier architecture • 3 Tier • Interaction layer • Application layer • Business Logic layer • Principles: Thin client en Thin server: • Only Business Logic and Data in the Business Logic layer • Minimal locale footprint for interaction: sandbox of the browser • Logic in the Interaction layer is minimal • Optimize the flow between the different layers: take the limitations of bandwidth and the performance-requests into account. User Interaction layer Application layer Business Logic layer

35. Synchronous EAI: Web Application Servers: positioning of logic Presentation Tier 1: Browser Presentation logic Tier 2: Web Applicatie Server Process logic Assembly logic Tier 3: Back-end Business logic Data

36. Synchronous EAI: Web Applicatie Servers: Model View Controller patern Presentation: show HTML pages Tier 1 Presentation logic : create HTML pages Tier 2 Process logic: control of the UI dialogue Assembly logic: combine functionalities of 1 or more back-end applications on 1 or more back-ends to 1 service for the UI process Tier 3 Business logic Data

37. Synchronous EAI: Web Application Servers: positioning assembly logic Tier 1: CLIENT Browser Presentation (view screen) Presentation logic (create screen) Tier 2: MIDTIER WAS Process logic (control of the UI dialoog) Aggregation services on multiple back-ends Assembly logic scattered over 2 tiers Connection frontend - backend Aggregation functions to services Aggregation functions to services function function function function function function function function Application Application Application Application Business logic Business logic Business logic Business logic Tier 3: BACK- END Data Data Data Data

38. What is asynchronous EAI? Adaptor Connection Semantic transformation Syntactic transformation Security Adaptor Connection Semantic transformation Syntactic transformation Security Intelligent router Replicator & Correlator Filter Router Security

39. Objectives asynchronous EAI • Asynchronous interaction between back-ends: • NOT for synchronous interaction between user and back-end. • Complementary to the working of the Web Application Servers • Back-end interactions are internally as well as externally • Realize a disconnection between applications, functional as well as technical: • “Plug and Play” • Re-use of services offered by the back-ends

40. When synchronous?When asynchronous? • Asynchronous if … • Cross-platform backend-to-backend interaction • Technical disconnection • Functional disconnection: no feedback within the same unit of work • Attention! • Technical SLA is “best possible time”, mostly “a few seconds” • Restrict amount of asynchronous steps within an end-to-end process

41. What is NDM ? NDM NDM • NDM stands for “Network Data Model” • NDM is a standard interface-model in KBC ICT • Only exists on the network between participants • Never by the participants • Standardized on a logical as well as a fysical level Application 2 Application 1 Application 3 Application 6 NDM Application 5 Application 4

42. Why NDM? 12 0 14 1 2 9 3 13 11 5 6 15 7 10 8 4 8 30 16 0 2 4 6 10 18 12 22 28 26 20 24 14 One way connecties: • What happens if 6 applications are talking p2p? Two way connecties:

43. Why NDM? 15 30 Number of connections (one way) • Managable? Number of connections (two way) No !!

44. NDM 1 2 3 4 5 6 2 4 6 8 10 12 One way connecties: 6 applications, communicating via a standard business document: Two way connecties:

45. NDM Standard business document definition for “order” • Solution! Order processing department Order processing department

46. When using NDM? NDM • By asynchronous backend to backend integration Application 1 Application 4 Network Data Model Application 2 Application 5 Adaptor Application 3 Application 6

47. Information layers Operational Distribution Product factory Product factory Product factory Company Management EAI + NDM Distributie Productfabriek Productfabriek Productfabriek Bedrijfsbeheer Staging Staging Staging Staging Staging Private Private Private Private Private Public Public Public Public Public Informational

48. Internationalization Translation Cultural formats Encoding

49. The alternatives for Internationalization • Ignorance • We don’t take any code page issues into account • Transliteration • Translate a non-standard character into the nearest form out of ASCII-7 (example: č becomes c) • Full cloning • Different platforms (OS, databases, applications) per codepage-instance • Cloning at the boundaries • A part of the platform is in Unicode, the boundaries themselves are cloned • Full Unicode

50. Internationalisation: strategic vision • Business long term strategy of globalisation • Unicode is the world-wide standard code page for storing and visualize all different character sets in the world without any loss. • Conversions between Unicode and locale code pages should be avoided as much as possible: • They introduce extra cpu overhead during runtime • They introduce extra complexity during design and build.