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This chapter looks at the experience of one of the largest hotel groups in the world to show how it’s leveraging a technology center of excellence to ensure effective governance of its many SOA-based business services.
InterContinental Hotels Group
InterContinental Hotels Group (IHG) includes a large, diverse group of wellknown names in the hospitality industry: InterContinental Hotels & Resorts, Crowne Plaza Hotels & Resorts, Holiday Inn Hotels & Resorts, Holiday Inn Express, Staybridge Suites, Candlewood Suites, and Hotel Indigo. The organization also manages Priority Club Rewards, which is the world’s largest hotel loyalty program, with more than 37 million members worldwide. The group manages more than 4,000 hotels in more than 100 countries.
Since 2002, IHG has deployed SOA to provide agility and efficiency. The following example illustrates how IHG leveraged SOA to improve its focus on customer service. Customer loyalty is very important to IHG, as evidenced by the success of its Priority Club reward system. The customer-loyalty division might access the SendGift service to send a thank-you gift to guests. On the other hand, the distribution division can reuse the same SendGift service to send coupons to other Priority Club members whom it feels might
book a room at one of its hotels. As the company saw the number of services climbing — and the projected growth of the number of service consumers climbing even more rapidly — it recognized the need to ensure standards and governance. This situation happened when the company had deployed somewhere between 50 and 100 services.
Creating a center of excellence
IHG’s chief information officer, Tom Conophy, who joined IHG in 2006, emphasized the need for governance as part of a disciplined service management process. He felt that the Global Technology organization needed to optimize its management of the growing number of business services. To do this, the company created what it called the Advanced Technology Platform (ATP). The vision and principles of service management and governance were embodied in the development of the ATP Center of Excellence (COE), instituted in 2008.
The ATP COE is a virtual body. Its members (all at director level or higher) are from departments across global technology at IHG that represent various service domains. A guest is one domain, for example. For a hotel company, the domain guest is very important. The person at the director level who
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owns the guest domain is the representative in the COE. Other domains include hotel, owner, product, revenue, and reservation.
Here’s how the COE works: When the business generates a new initiative, a member of the IHG enterprise architecture team studies it, determines what domains it will affect, and contacts the domain owners. This research
occurs in the early stages of a project, when funding has been approved but the service hasn’t been designed, to give the governance team early involvement in the process. If a new service involves the guest domain, for example, the guest-domain owner is notified. Then the domain owner determines what kind of information will be requested, as well as any required changes. Because a change to one service may affect other services, a dialogue often begins among domain owners.
The COE provides a holistic view of all the managed business services and institutes a process for vetting decisions about services. The group has the power to mandate change. Its two top priorities are managing the life cycle of services and improving the process for managing provider–consumer relationships.
Managing the service life cycle
One of the COE’s key goals is developing an ongoing process to manage services from a life-cycle perspective. Bill Peer, director of enterprise architecture in IHG Global Technology, says, “Once you have your services identified, they have a life cycle of their own. They have their own birth, generation, existence, and death. You need to accommodate all phases of life of these services.” An enterprise the size of IHG has many domains staffed by people with varying levels of expertise. No one person can know everything about every service.
Unanticipated situations occur as services age. Many challenges occur in relationship to change management. A service may have operated just fine for several years under the direction of a particular business unit, but evolving business priorities shook things up a bit. A different business unit initiated a new business opportunity, which required an upgrade to the original service.
Before moving forward, the company had to answer the following types of questions:
Who created this service?
Who has the authority to make a change?
Who do we need to contact to understand the full impact of making changes in the service?
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How many versions of this service should be maintained?
Are different service versions compatible?
Before the development of the COE, questions such as these were hard to answer and possibly weren’t considered at all.
Collaboration between domain owners
As services become more complex and more widely used, good communication among service providers and users became essential. At IHG, domain owners vary the types of communication about services depending on complexity. The logical approach for handling a trivial issue is using e-mail that gets captured, stored, and chronicled. When technical requirements demand greater interaction, the domain owners discuss the issues during a formal meeting. The enterprise architecture group facilitates meetings of this type. According to Peer, one of the key benefits of the COE is that the “collective knowledge of the group really makes this thing work.”
Meeting service levels
Every service has a service-level minimum to adhere to. One application may have to respond in 100 milliseconds; another, in 150. Both applications use one or more services. IHG always develops its services to accommodate the shortest interval of time. That 100-millisecond response time becomes the service-level agreement (SLA) unless another request requires 75 milliseconds, in which case the response time can be adjusted. Therefore, different applications don’t have unique response times. The team members understand that this approach involves trade-offs, but they chose it for its simplicity.
The group discusses hardware and operational cost implications before agreeing to change something, such as a response time. A business reason for lowering that response time may exist, yet the hardware costs may be prohibitive. The business always gets involved. The COE highlights the pros and cons of changing the SLA and then presents the details to the business to decide whether it can pay the price.
Sometimes, the process isn’t as straightforward as getting one business unit to agree to a change. If an SLA has to be met for a broader project (such as a marketing or brand-driven project), the team turns to a businessperson in that guest domain. That person may or may not be in the reporting structure of the part of the business unit that’s requesting the change, so getting the business units talking is important. The units can decide whether it’s possible to share the cost and, if not, who will pay it.
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Finding a balance
Peer is quick to point out the importance of finding a balance in the governance process. He believes that if governance is too formal, it stifles innovation. On the other hand, a governance process needs to be in place. His team’s process appears to be working. Peer structured the process to make it part of the project-initiation request process, which has become an early indicator for the business coming down the pike. The COE has helped give multiple domain owners advance knowledge of changes in business services. Taking a life-cycle approach to service management helps IT be more responsive to business needs.
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