This week, I was sloshing through the sleet and snow of New York City (still a fabulous city no matter what the weather) to attend and present on a panel at SOA on Wall Street (also so named Web Services on Wall Street). I participated on the opening panel which took a look at Web 2.0 and SOA and its implications and relevance for Wall Street organizations.

In a nutshell, Wall Street needs SOA and situations like Societe Generale are making it more urgent. I also believe Wall Street can benefit from the “wild and wooly” world of Web 2.0. Perhaps not for their mission critical infrastructure that requires the highest levels of performance, operational integrity and security, but definitely for collaboration, encouraging innovation between department and teams and non-critical information syndication. However, I disagreed with one of the panelist members who made a statement that SOA capacity is hardly realized so we should not worry about the governance or operational concerns and focus our energy on fostering innovation. I believe the time is now for all organizations, financial services and otherwise, to plan for and work with SOA governance, as well as SOA quality and management, to build out the infrastructure and best practices, so that when they find that “killer composite application” or that viral Web 2.0 service, they are prepared for the onslaught of new consumers, the load and performance implications, the version management challenges and can support innovation at the speed of business with the rigor of operational IT.

For the last two years, it seems organizations have focused around the need to modernize the middleware infrastructure to support SOA. Firms have been investing in ESB, BPM and data services and building out integration, data and some business-level services for use in composite applications. Now banking and FSI is primed for the embrace of Business-Technology Optimization for SOA -- governance as well as quality and management. These companies are going to run into all the visibility and trust issues the industry analysts discuss about SOA Governance by just focusing their architecture, development and delivery teams on the ESB and integration layer without thinking about how they will foster service visibility, consistency, policy management and service consumer management.

That said, I think the Wall street front office is probably the most challenged in embracing SOA right now as the focus has been on performance, data integrity, security, operational resilience and performance (did I already say that?). But that doesn't mean a Wall Street firm is not ready for SOA. During the conference we discussed a lot about the need for SOA in the middle office to help with innovation, research, new customer offerings, and to avoid situations like Societe Generale through visibility, trust and control.

It doesn’t matter where SOA is happening (front, back or middle) it will need governance.

For companies that don't have appetite yet for full-scale governance, something like HP’s newly announced Governance Validation service is a great entrée… Think big and start small -- take a domain or single project and implement a focused governance implementation for a contained set of services and then scale when ready. With this approach you can immediately see measure able benefits without a large initial cost (assuming you have a clear organizational owner and roles defined for governance – worth another blog)

There is a place for SOA and Web 2.0 on Wall Street – in the middle office or anywhere where agility and collaboration are paramount. To hear more about the insights shared at the event, see the event page at: http://www.webservicesonwallstreet.com.