Agile 3 Solutions

TRANSFORM * GOVERN * TRANSCEND

Enterprise Architecture Workshop

Instructor: Raghu Varadan,
Agile 3 Solutions & Heinz College, CMU

June 17th 24th 2010

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A view of Enterprise Architecture governance bodies
and architecture stakeholders

Architecture Board
Business Steering
Committee (BSC)
(Executive Team)
Identify business
requirements
Review and approve
major architectural
changes
Review and resolve
escalated architectural
issues
Review and provide
feedback on the
effectiveness of the
Architecture Board
Sponsor and champion
the Architecture across
the enterprise
Architectural
Stakeholders
Sponsor the Development / Update Review architectural
of the Architecture
changes and updates
and provide feedback to
Identify / Review and Approve / the Architecture Office
Deny Architectural Changes Locally sponsor and
champion the Enterprise
Communicate and Champion the Architecture
Architecture (inc. funding) Support conformance to
the Enterprise
Establish / Implement Architecture
Conformance Submit requests for
Architectural changes
Address Architectural Exceptions / and exceptions
Appeals
Modify Architectural Management
Process (as appropriate)

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Context of Business Architectures in EA
and Governance

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Business modeling why yet another
modeling construct
A context

When we question our clients about certain

processes - the answer is, that's the way it's
always been. People don't question things that
are in place already

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A Map Represents Something Used for a
Specific Purpose

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Business-centric EA programs are viewed as an operating model for
business transformation linking business strategy, business process, and
business services delivery
On-Going Business Strategy / Business Process Excellence / On-Going Reusable
Governance Business Process Governance Framework Governance

Business Process Transformation

Business Business Process Automation
Strategy Process Monitoring

Manage Control /
Define Leverage
Portfolio

Business Process Modeling

and Analysis

Solution Business Process

Integration Choreography

Services Linkage
and Alignment

Service Service Service Service

Planning Modeling Implementation Management
Define Service Focus Service Identification Service Design Measure Service Quality

Define Service Funding Service Specification Service Assemble Manage Service Reuse

Define Domain Owners Service Realization Service Test Manage Service Change
Services Services
Service Deploy Manage Service Security
Governance Governance
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Markets are Characterized by
Disintermediation and Dis-aggregation
Disintermediation refers
literally to the process of
Dealer
Manufacturer Car Buyer
removing the
intermediaries.

Disaggregation is about Flight

Operations Flight Operations
ever-greater levels of Maintenance Catering
specialization, as when Operations Operations

products or services are Fuel Service

Ground &
Ramp Crew
further broken down.

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As organizations grow, they seldom take a hard
look at their operations and try to optimize
The result is that they have many non-optimized
operations glued together resulting in inefficiencies
across the enterprise
Markets today are characterized by disintermediation (of
the industry value chain) and dis-aggregation (of
products and services).
Success in this environment requires organizations to
become flexible, responsiveindeed all the attributes of
an On Demand enterprise.
The modular nature of the component view enables this
transition

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The Message from an IBM Study:
Simplify to Succeed
A study of more than 8,000 retail financial
institutions worldwide
Traditional incremental and piecemeal
approaches to systems and process change have
brought ever-increasing complexity and inflexibility
Similar complexities have arisen in most industry
environments, resulting in unwieldy business
models and an inability to change

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Changing business models and the
need to focus on the core business
The Reality The Plan
Mass Private
Mass Private Retail Banking
Retail Banking Segment Segment
Segment Segment
Mass Ultra High
Product Mass Ultra High Product Sub-Prime Affluent
Sub-Prime Segment Net Worth
Specific Segment Affluent Net Worth Specific Segment Segment
Segment Segment
Delivery Delivery

Marketing Marketing
Sales & Sales&
Distribution Distribution

Product simplification Product

Manufacture Manufacture

Operations Operations

Shared Shared
Facilities Facilities

Product Product Product Product Product Product

Silo 1 Silo 2 Silo 3 Silo 1 Silo 2 Silo 3

Agile 3 Solutions Proprietary & Confidential Source: Simplify to Succeed, IBM

Snapshot of Business Views
Process View
Gather
8.0 Select 9.0 Forward Candidate

Value Chain View

candidate
from pool Slate and Employee
information
candidates Pool & Outcomes forms
18.0 Hiring
sheets
to HR
manager notifies
selected
candidates

3.0 Coordinate
Manager position needs
with HR

27.0 Notification

13.0 Collect 15.0 Update

4.0 Prepare 11.0 Is slate Y 14.0 Conduct
12.0 Update
10.0 Receive selections for status to
candidate 7.0 Forward candidate or status to adverse

Buy Make Sell

documents and appropriate? each selected or
pools to managers pending impact
candidate pool not selected

6.0 N

Coordinate
HR
candidate 24.0 Re - 16.0 legacy

information Y approach manager, buddy

gathering of candidate pool? manager or HR

managers notifies non

selected

N candidates

25.0 Open
job requisition
17.0 Manage
to fill position
WFR

21.0 Change -
22.0 Update position rollup,
status of pool selection metrics, dash 23.0 Forward
board information
candidate to data to PMO
selected and
accepted
26.0 Manage Candidate Pools

Employee

Y 19.0 Receive
20.0 Accept? acceptance
letter

Expected to have level 2 (sub - process) definition

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Emerging Business Architecture views
and constructs Business
Plans
Business
Strategy
Prod. Portfolio
Component View
Updates

Market
Segment
Planning Tracking Segment
Models & Tracking
Market
Targets
Events

Component Business Modeling is:

A Method
Whereby organizations can identify opportunities for improvement and
innovation
By regrouping their current activities into a manageable number of discreet,
modular, and re-usable components
That enable flexibility
And provide for a clarified focus on the core capabilities needed to run the
business and drive business strategy
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 A Business Architecture Map is a tabular
view of the business component model
Columns are Business Competencies,
A Business Component is a part of an defined as large business areas with
enterprise that has the potential to operate
characteristic skills and capabilities, for
independently, in the extreme as a example, product development or supply
separate company, or as part of another
chain.
company.

Business New Business Relationship Product Financial Control

Servicing & Sales
Administration Development Management Fulfilment and Accounting

Business Account Fulfilment Portfolio

direct Sector Planning Sales Planning
Planning Planning Planning Planning
An Accountability Level characterizes the
scope and intent of activity and decision-making. Business Unit
Sector
Management
Relationship
Management
Compliance
Tracking
The three levels used in CBM are Directing, control
Sales
Management
Fulfilment
Planning
Controlling and Executing. Staff Appraisals
Product Credit Reconciliation
Management Assessment
Directing is about strategy, overall direction
and policy. Product
Product
Directory Sales
Controlling is about monitoring, managing Staff
Administration
Fulfillment Customer
Accounts
exceptions and tactical decision making Credit
execute
Executing is about doing the work Marketing
Administration Customer
Dialogue
Document
Campaigns
Production Management General
Administration Ledger
Contact Routing

Agile 3 Solutions Proprietary & Confidential Source: CBM, IBM

A business-driven EA approach facilitates the
early alignment of IT with the Business Strategy

Business Domains
Operations Strategy Business Case
Business Implementation
Management Plan
Service Creation
Support Services
Scoring
Core Products Implementation
Existing Services
Reuse
Future Reuse
Business
Portfolio

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EA Governance

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The Fundamental Question
Are we managing our investments
in IT such that:
o we are getting optimal value;
o at an affordable cost; and
o with an acceptable level of risk?

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 The Reality
" Gartner more than 600 billion $
thrown away annually on ill
conceived or ill executed IT
projects
" Standish Group about 20% of
projects fail outright, 50% are
challenged and only 30% are
Low return from high-cost IT investments, and transparency
of ITs performance are two of the top issues successful
More than 30% claim negative return from IT investments
targeting efficiency gains " ITGI 2005 Survey early findings
40% do not have good alignment between IT plans and
business strategy confirm concerns
Interest in and use of active management of the return on IT
investment has doubled in 2 years (28 to 58%)

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The Good News
Enterprises that actively design their top-level IT
governance arrangements make and implement better
IT-related decisions
Gartner

Effective IT Governance is the single most important

predictor of the value an organization generates from IT
Firms with focused strategies and above average IT
Governance had more than 20% higher profits than
other firms following the same strategies
Peter Weill and Jeannie W. Ross, IT Governance

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The Bad News
Only 38% of executives/senior management can describe their
organizations IT Governance process
In most cases, IT Governance has not been designed it has just
developed piecemeal in response to specific issues
Peter Weill and Jeannie W. Ross, IT Governance

85% of organizations demand business cases for change projects

Only 40% of approved projects have valid (realistic) benefit statements
Less than 10% of organizations ensure benefits are realized post-project
Less than 5% of organizations hold project stakeholders responsible for
benefit attainment
Meta Group July 2004

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 EA Governance A balanced approach

Optimal Target based

on Requirements

Unstructured Too Structured

Free-for-all No room for creativity
Unrepeatable process Governance Bureaucratic and slow
No metrics Balanced Too many metrics
No documentation Repeatable process Policy & procedure excess
Relies on heroes Measurable Often ignored / undermined
Documented and used
Continuously improved
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Without Effective Governance
Situation Leads to.. Results in..

Over
Too many projects
budget
Projects
Late
Cant kill projects
Quality of execution
Business
suffers needs not met
Benefits not
Underestimation of received
risks and costs
Lack of
confidence
Projects not aligned (in IT)
to strategy

Source:
Fujitsu
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 The Four Ares-
The strategic question. Is the Technology or Project:
" In line with our vision?
" Consistent with our business principles?
" Contributing to our strategic objectives?
" Providing optimal value, at affordable cost, at an
acceptable level of risk?
continually asking
In the value question. Do we have:
" A clear and shared understanding of the expected
benefits?
" Clear accountability for realising the benefits?
" Relevant metrics?
" An effective benefits realisation process?

Are we doing
Are we
them the right
Some fundamental doing the
way?
right
questions things?

Are we
about the
getting value delivered
Are we getting them done
the benefits? well? by IT
The delivery question. Do we have:
The architecture question. Is the Technology or Project: " Effective and disciplined delivery and change
" In line with our architecture? management processes?
" Consistent with our architectural principles? " Competent and available technical and business
" Contributing to the population of our architecture?
resources to deliver:
" the required capabilities; and
" In line with other initiatives? " the organisational changes required to leverage the
capabilities?

Agile 3 Solutions Proprietary & Confidential Source: The Information Paradox

 Evaluation criteria
Alignment
Business worth
Are we Are we
doing getting
the right the
things? benefits?
Picking
the
Winners

Are we
getting
them done
well?

Risk
Source: Fujitsu

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Measuring EA
http://www.opengroup.org/architecture/togaf8-doc/
arch/chap27.html
http://www.nascio.org/publications/documents/
NASCIO-EAMM.pdf

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The EA must be governed as part of the larger
end-to-end planning process
Business Direction Enterprise Architecture Investment
(identify services) (architect solutions) (results)

Strategic Transition Transition

Corporate Prioritization Gap Analysis Initiatives Roadmap
Map
Strategy Investment
Organization Analytical Plan
Process Views & Enterprise Architecture
IT Scenarios
Performance
Business Architecture Measurement ROI
IT Business
Plan
Tech. Trend Capability
Map Application Architecture
Capital
As Is Strategic Information Architecture Asset Plan
Imperatives &
Business Value Drivers
Issues Technology Architecture Project
Consolidated Portfolio
IT Issues
Business
Needs
EA Governance
Principles, Architecture Architecture Architecture
Decision Model Policies & Management Management Management
Guidelines Processes Roles / Resp Metrics

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