Centralize vs. De-centralize. Is SOA the answer?

With the economic downturn, businesses will be looking for ways to control costs. Will that mean more centralization? How will more centralization conflict with the web2.0 trend towards lighter more de-centralized apps. Will the lighter and more niche software/hosted products find that funds from business units are drying up?

Popular Knowledge Management expert David Gurteen spoke about this tension even before the financial crisis on his blog. Larry Hawes has a recent blog post discussing Autonomy in Collaboration.

I have had several discussions in the last few days with a VA-based firm currently struggling with the issue of centralization. Historically, their business has been run as autonomous business units free to operate in the way that best meets their customers’ needs.

While I am sure this firm has always struggled between centralization and de-centralization, the web has exacerbated the problem and web2.0 has taken it to yet another level. With the advent of the web, each unit began developing a channel to interact with their customers. A few years ago when the company wanted to upgrade to a more web2.0 approach which allowed their customers to contribute more in the online environment, they sought to build a common platform.

However, the autonomous business units lived on. Because they are quite independent, they are constantly seeking to diverge in order to meet the specific needs of their customers. At the same time IT continues to work towards increased centralization. As you can imagine, this is creating some tension.

A service oriented architecture (SOA) with shared web services and appropriate SOA governance might be their salvation. If IT can control the main architecture and help facilitate the sharing of approved web services, this firm may be able to get the centralization they need while allowing for business units to meet their own customer needs.

Is SOA the way that this increasing tension might be relieved in many organizations? I doubt IT is going to give up working towards standardization and cost savings and I know that if business units feel their customers are not being served by what IT is providing, they are going to continue pushing for autonomy. If not SOA, how is this tension going to be resolved?

4 responses to “Centralize vs. De-centralize. Is SOA the answer?

  1. Hi Robert,

    I’ve added my 2 cents here: http://tinyurl.com/63a9uh

    -brenda

  2. Pingback: Todd Biske: Outside the Box » Blog Archive » Centralization and SOA

  3. Pingback: Service-Oriented Architecture mobile edition

  4. Pingback: Resolving centralization / decentralization tension with SOA? : Elemental Links

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