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Risk in agreement networks

Decision support for service-intermediaries

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Abstract

The current trend towards dynamic and highly scalable service provisioning fosters the rise of Software as a Service (SaaS) platforms and manifests the need for dynamic composition of services. In order to enable the combination of services and hence, the collaboration between different service providers, technical challenges like the compatibility of interfaces have to be dealt with. Additionally, economic issues concerning profit, reliability and risk have to be taken into consideration. This work covers economic considerations from the viewpoint of a service intermediary that offers complex services to customers and purchases services from supplying providers. The intermediary has to decide, which SLAs to offer to consumers and which SLAs have to be established with supplying providers. The decision support for the intermediary that is presented throughout this paper is an adaptation of security portfolio optimization stemming from finance. It is based on monitoring data of SLAs that the intermediary had established in the past with consumers and with supplying providers. Finally, the decision support is exemplified in a case-study.

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Notes

  1. http://aws.amazon.com/

  2. http://www.programmableweb.com/

  3. http://www.pcworld.com/article/164946/

  4. http://news.cnet.com/8301-1001_3-10136540-92.html

  5. http://www.datacenterknowledge.com/archives/2009/07/19/

  6. Complex (or composite) services typically involve the assembly and invocation of many pre-existing services possibly found in diverse enterprises to complete a multi-step business interaction.

  7. In this context we do not differentiate between the providers’ and customers’ view of substitutability and complementarity of services.

  8. http://deutsche-boerse.com/dbag/dispatch/de/listcontent/gdb_navigation/technology/30_Access_Products/30_Proximity_Services/page0_ts_sp_proximity_services.htm

  9. http://www.salesforce.com

  10. http://www.valuegrids.de

  11. This is possible as the \(\iota\)’s penalties are taken into account in the first step of SLA portfolio selection and as the total expected profit that was calculated in Sect. 4.2 includes costs for service consumption and expected penalties that \(\iota\) receives from contracting partners.

  12. The higher the factor, the higher the degree of risk-aversion.

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Authors and Affiliations

  1. Karlsruhe Institute of Technology, Englerstr. 14, 76131, Karlsruhe, Germany

    Wibke Michalk & Benjamin Blau

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  1. Wibke Michalk
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  2. Benjamin Blau
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Correspondence to Wibke Michalk.

Additional information

This research was partially funded by the German Federal Ministry of Education and Research (BMBF) under promotional reference 01|G09004.

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Michalk, W., Blau, B. Risk in agreement networks. Inf Syst E-Bus Manage 9, 247–266 (2011). https://doi.org/10.1007/s10257-010-0145-1

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