E-business is shifting attention from component based to web service based applications. Most enterprises spend most of their time assembling applications by consuming web services rather than worrying about the design principles underlying them, their granularity or the development of components that implement them. In this paper we present a design methodology for web services and business processes. We discuss how business process should be described so that services can be properly identified and provide strategies and principles regarding functional and non-functional aspects of web service design.