Merrill Lynch & Co.: Web Services, Millions of Transactions, All Good

By Mel Duvall Print this article Print

The firm reinvigorated 420 financial programs stored on mainframe computers. How? By building—from scratch—Web services that can handle millions of interactions a day.

Jim Crew could be considered an All-Star in the fledgling field of service oriented architecture. Over the past four years, Crew, as the former head of database infrastructure at Wall Street brokerage Merrill Lynch & Co., had spearheaded an effort to modernize the firm's multibillion-dollar investment in mainframe technology by building a platform to easily integrate many of the company's decades-old legacy applications with new software.

Since 2001, his team has helped generate as many as 420 Web services—essentially using a collection of Internet technologies like eXtenstible Markup Language (XML) and Simple Object Access Protocol (SOAP) to make operations currently performed on the mainframe available to programmers creating new applications in modern environments such as Sun Microsystems' Java or Microsoft's .NET.

In the process, he has helped Merrill Lynch save as much as $42 million in application development by being able to leverage business-hardened code on the mainframe and by making new hardware purchases unnecessary. In getting information directly from the mainframe and reusing existing legacy applications, Merrill has avoided having to copy information to more modern database platforms like Oracle and Sybase or rewriting software to run on application servers.

But much like skiing's Bode Miller, this all-star is also a rebel.

Unlike many other corporations that are embracing Web services, Merrill decided to do it without the help of a traditional vendor of Web services platforms, such as webMethods, Neon Systems or BEA Systems. Instead, it chose to develop and implement an entirely new Web services architecture on its own.

"We took a very careful look at what was available in the industry at the time. It would have been a lot easier to buy what we needed than build it," says Crew, who headed up Merrill's database organization in Hopewell, N.J. It would have also allowed Merrill to get up and running faster. "But we couldn't find anything that met our requirements," Crew explains. "In our opinion the [existing] SOA vendors were going about the problem the wrong way."

The crux of the problem, as Crew saw it, was that most of the Web services development platforms being pitched by the vendors had been built from the perspective of the distributed programmer, or programmers using modern development tools such as Java and .NET.

That just didn't make sense for Merrill because the firm would have to retrain many of its 1,200 programmers and purchase more powerful workstations to develop the Web services platform.

In fact, Merrill has a huge IBM mainframe installation—one of the largest in the world—with 1,200 programmers supporting some 23,000 mainframe programs that process 80 million Customer Information Control System (CICS) transactions per day. Each time a person logs on to a Merrill Lynch account online, or enters his password at a bank machine, could be considered one transaction, although the action of signing in at a bank machine or online would trigger many other transactions.

The company's mainframe programmers were the guardians of that "treasure." They knew what work was performed by the legacy programs and what information was stored in the databases, and how they might be leveraged by other applications in development. Training those programmers in Java or .NET would have been an expensive undertaking.

According to research firm Gartner, it can take an enterprise 12 months and as much as $67,000 to retrain a COBOL developer in Java.

In addition, it would have required Merrill to purchase new, more powerful desktops for its mainframe programmers to run the SOA application development software. As a result, Merrill opted to build its own Web development platform from scratch.

QUESTION: What's the biggest headache your tech team can expect to get from deploying Web services? Let us know at Baseline@ziffdavis.com

Story Guide:

Merrill Lynch & Co.: Web Services, Millions of Transactions;, All Good

  • Unlocking Access to Customer-Service Functions
  • Despite Complexity, Merrill Skipped Middleware
  • Mainframe Remains Strategic
  • Base Case: Merrill Lynch By the Numbers

    Next page: Unlocking Access to Customer-Service Functions

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    This article was originally published on 2006-02-07
    Contributing Editor
    Mel Duvall is a veteran business and technology journalist, having written for a variety of daily newspapers and magazines for 17 years. Most recently he was the Business Commerce Editor for Interactive Week, and previously served as a senior business writer for The Financial Post.

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