Before getting into federated agility, I want to describe a scenario where business value has evolved over the past 20 years. Let me take you back: planning of a family vacation involved only a few simple activities. The first step was asking your friends and family about where they have gone before. In the process, they would tell you about different hotels, restaurants and airlines with which they had the best experience. Based on the level of trust you had with these sources of information, you placed a couple of phone calls and made the travel reservations. Most other decisions and experience components were defined by chance (i.e., weather, traffic, discounts or local events).
Today, we jump on Travelocity or Expedia to review images, customer comments, local amenities and areas of interest. We can compare and contrast multiple locations, hotels, travel agendas and the weather. Local influence has been replaced by trusted global networks or social networks that connect people with similar interests. Short family vacations have been replaced with global experiences anywhere in the world (i.e., African Safari or Alaska Cruise). The information age has changed just about every dimension of the travel industry and literally destroyed the traditional travel agent. Most information you need to plan and experience a world-class vacation is readily available to you 24 hours a day.
Now, let's play out this scenario 10 years from now. You open up a device that manages your life and enter in a request for vacation. The system then takes over every aspect of the vacation. The personal (virtual) agent will review every airline, schedule and run a cost benefit analysis involving your various frequent flyer miles and travel relationships. Locations will be selected by weather, local activities, percentage of booking, travel time, distance and child activities. Reservations will be made automatically based on your individual profile information. Your doctor visit and hair appointment will be rescheduled. Your mail will be stopped for the week and the local authorities will be notified that you will be out of town. The local Kroger will deliver your prescriptions as well as groceries for the entire week prior to your arrival. A certified baby sitter will be scheduled, and a sunset reservation will be made at a nice seafood restaurant. A schedule of local events and coupons will be produced and placed on the coffee table. Family photos and previous beach vacation photos will be transmitted and digitally loaded into the dozens of picture frames located in the condo. Wow! That would be great. Hold on, we are not done yet. Your kid's favorite movies and games will be made readily available when you arrive. The radio will be pre-tuned to your favorite music as well as loaded with your iPod music library. The local bookstore will deliver the latest romance novel and business book so you can entertain your mind while sitting on the beach. As with past transformations, some people will hate the new world while others embrace the transformation.
What kind of revolution is going to happen to make all of this happen? Two specific mutations of business, technology and commerce will occur: federation and agility. Federation is an attempt to describe an environment where businesses are small, integrated, and work together to create end-to-end value for the customer. A federation is a collection of objects working together for some time period of time. This time period can be very small, as in a business transaction, or very long, as with a business partnership. In the old days, consumers looked toward a company to own and operate the entire value chain. We expected McDonalds to actually grow the potatoes and Ford to build the parts for the car. As time moved on, parts of the value chain began to break apart and move to lower-cost providers or to people that were simply better at it. Look around - the security guards don't work for the airport, the car attendant doesn't work for the hotel, nor does the technology specialist work for the company. Have you heard of the UPS slogan, "What can Brown do for you?" UPS doesn't just want to deliver your packages, they want to own your entire logistics department and supply chain. This movement isn't new and will continue as the barriers of commerce continue to fall. One question that comes to mind is how will these federated organizations work together and integrate the business processes? Today, we have something we call service level agreements (SLA) or contracts that inform us of our legal responsibility. How will we write a SLA for a single millisecond transaction? The answer is that we won't; we will be part of a trusted network built around distributed technologies. Because virtual agents that plan your vacation will need to be able to traverse the networks of hundreds of different organizations, membership to the federation will be critical.
However, a federation isn't the only thing going on here. The next generation of businesses will be characterized by the amount of change and the degree to which the organization handles that change. Business agility can be described as the ability of the enterprise to cope with unpredictable changes, to survive unprecedented threats from the business environment, and to take advantage of changes as opportunities (Goldman, Nagel and Preiss, 1996). The world of business is changing due to a variety of forces such as mobilization, collaboration, integration and digitalization. Agility was once a term used to describe small and nimble organizations that could change their business model and internal processes very quickly. This agility provided a competitive advantage for the smaller organization, but that's changing as more and more organizations implement agile technology, agile business processes, service-oriented designs and ubiquitous communications. One example of a company already in the agility mode is Cemex; the third largest cement company in the world, based in Mexico. Creative thinking has led them to invent a concrete mix with added anti-bacterial agent which means that when used for flooring in low cost housing projects for poorer communities, dwellings have built-in health protection; when used in hospitals and clinics, the treated concrete not only helps kill germs but also means less expensive cleaning agents need to be used. In addition, Cemex cut costs and delivery times by using global-positioning satellite technology in its delivery trucks and redefined its business model with online auctions.
What technology is going to be the secret ingredient in enabling this type of global agility in a federated model? The same technology that makes information architecture work, that enables search engines to create value and integrates the enterprise architecture: metadata. As the world moves away from the physical creation of value, the physical integration points will also fade away.
Within the technology world, we already see direct interfaces being replaced with middleware and self-describing Web service interfaces. As more and more businesses move into the federated model, the importance we place on metadata will also increase as metadata becomes the essence of business value. Think about why some products win over others; in many cases, the product that is the easiest to use or purchase owns the market. While functionality and performance will be important elements, the ability to integrate seamlessly will be a competitive advantage for those that get it right.
Nova Spivak (2004) published an interesting matrix that basically states that the Internet connected information, the semantic Web will connect knowledge, social software will connect people, and the Metaweb will connect everything. Digital ecologies will only exist when the core structures can be seamlessly defined and reused. Much in the same way biological entities use DNA, we will use metadata as the basis of living life in the future. How, you ask, especially considering that we do such a poor job of documenting, classifying or tagging (or what ever the current metadata buzzword is)? The giant leap will be the automated creation of metadata through various technologies such as patient monitoring, environment scanning, location awareness and intelligent guidance. The biggest mistake we make in technology revolutions is that the perceived rate of change is consistent but the reality is that the rate of change, especially technology change, is increasing far greater than we can even imagine. Federation and agility are two terms that you can expect to hear more and more about in the coming years. Or, maybe I am wrong - consider this quote about or world today:
"The world is too big for us. Too much going on. Too many crimes. To much violence and excitement. Try as you will, you get behind in the race. It's an incessant strain to keep pace and still you lose ground. Science empties discoveries on you so fast that you stagger beneath them in hopeless bewilderment. Everything is high pressure. Human nature cannot endure much more" - Atlantic Journal - June 16, 1833.
Some things never change ...
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