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  • 1. IT Strategy and Enterprise Architecture Aligning Business and IT David Baker Chicago CIO Council Partner & Chief Architect DiamondCluster International EA Council David.baker@diamondcluster.com November 11, 2005 Lloyd L. Smith Partner, Healthcare Practice DiamondCluster International Lloyd.Smith@diamondcluster.com
  • 2. Agenda IT Strategy Enterprise Architecture IT Strategy & EA in Action Page 2
  • 3. An IT Strategy is a plan for managing IT, holistically, as a business Aligning the IT Ensuring that the IT organization’s structure, organization is aligned skills and sourcing with the business strategy with the needs throughout the cycle of of the business, while innovation, planning promoting employee and delivery learning and satisfaction Defining the technology Managing IT resources architectures and the and operations to processes for ensure effective and developing, deploying, efficient support of enhancing and business and financial supporting business goals capabilities using technology solutions Page 3
  • 4. An IT Strategy examines a broad set of IT capabilities Strategy and Organization and Skills Business Alignment Ensuring that the IT organization is aligned with the Aligning the IT organization’s structure, skills and sourcing business throughout the entire cycle of innovation, strategy with the needs of the business, while promoting planning and delivery employee learning and satisfaction Strategic and Operational Business Models Organization Strategic IT Planning and Investment Skills and Competencies Business/IT Relationship Learning Usability and Technology Adoption Human Resources Business/IT Service Levels Facilities and Work Environment Management and Governance Technology and Architecture Defining the technology architectures and the processes Managing IT resources and operations to ensure effective for developing, deploying, enhancing and supporting and efficient support of business and financial goals business capabilities using technology solutions Current Technology Portfolio Architecture Blueprints for standard application, data and Project Portfolio Management infrastructure architectures IT Governance Guiding Principles Finance and Accounting Metrics and Measures Vendors and Partners Architecture Processes and Governance Program and Project Management Architecture Organization and Skills Communications and Marketing Repositories of all technology assets Technology Management and Utilization Page 4
  • 5. Agenda IT Strategy Enterprise Architecture IT Strategy & EA in Action Page 5
  • 6. Enterprise Architecture is used to describe an entire organization – using both business and technical views “The enterprise architecture is the organizing logic for a firm’s core business processes and IT capabilities captured in a set of principles, policies, and technical choices to achieve the business standardization and integration requirements of the firm’s operating model.” - MIT Center for Information Systems Research, 2004 “A strategic information asset base, which defines the mission, the information necessary to perform the mission and the technologies necessary to perform the mission, and the transitional processes for implementing new technologies in response to the changing mission needs. An enterprise architecture includes a baseline architecture, target architecture, and a sequencing plan.” - Federal Enterprise Architecture Framework, 1999 “Enterprise architecture is the capture of all behavior that goes on in an organization: the data that is processed, who does what, where everything is, and why everything is done. In a sentence, the who, what, why, when, where, and how of the business at every level from high-level corporate goals to the code of low-level programs that implement business processes used to achieve those goals.” - The Open Group “Enterprise” may be a whole organization, that organization plus its external customers/suppliers, or a segment of an organization. However, “enterprise” ALWAYS refers to the combination of business and technical views. Page 6
  • 7. Enterprise Architecture answers key questions for IT stakeholders IT Business Managers wants to know want to know Enterprise How can I innovate? Have we done this before? Architecture How quickly can I get it? How do we get it done? How much does it cost / save? How do I make sure it’s done correctly? What are the risks? What’s possible? What’s possible? Technical Staff wants to know What do I build? What do I build it with? Enterprise Architecture is the broker between Business and IT. It provides the benefit of knowing why we need to build, what to build, when to build it, and how to build it. Page 7
  • 8. Enterprise Architecture helps organizations manage IT complexity and make better investment decisions • Ensure architectural alignment with business goals – Include business strategy and operations as enterprise architecture models • Ensure architectural alignment across enterprise initiatives – Integrate enterprise level blueprints with individual project execution (SDLC) • Realize savings through optimal usage of the organization’s architecture – Define, and monitor compliance with, enterprise shared services • Maintain architectural quality standards across enterprise initiatives – Integrate enterprise architectural oversight into the Software Development Lifecycle • Assess an organization’s architectural health – Establish enterprise architecture measurements and dashboards Enterprise Architecture requires the use of multidisciplinary expertise and frameworks. Page 8
  • 9. Establishing an EA capability is a multi-faceted endeavor Blueprints describe the business requirements Architecture Processes document how and technology components in a way that architecture design is performed and how enables their linkages to be traced from architecture is communicated and implemented business owner to system developer. in the organization. Architecture Blueprints Architecture Guiding Metrics & Measurements Principles serve as guideposts Architecture describe the quantitative and for strategic and tactical Processes qualitative goals for the technology decision-making enterprise architecture to Arch. and are a necessary Metrics & ensure that value is Guiding Organization & Skills communication tool to unite Measurement measured and Principles Planning and business and technology communicated. Technology Strategy and Technical Technology Solutions Planning Architecture Resaerch constituencies. Architecture Governance Organization & Skills details Architecture Governance is a the structure, capabilities and comprehensive set of policies, qualifications needed at the Architecture processes and procedures that various levels of the Repository ensure proper, yet flexible, guidance and approval organization to build, maintain, checkpoints for architecture. and implement the architecture. The Architecture Repository is the control point for all architectures assets – blueprints, processes, metrics. The repository is accessed and managed thru the architecture toolset. Page 9
  • 10. Agenda IT Strategy Enterprise Architecture IT Strategy & EA in Action Page 10
  • 11. EA plays a critical role in the overall IT Lifecycle and is a primary element of any IT Strategy As-Built Architecture Approved Projects Business Enterprise Release Project Business Strategic Architecture Planning Execution Operations Planning Blueprinting (Portfolio Mgmt) (SDLC) EA Governance Objectives & Measurement Indicators Metrics Architecture Benefit Results Business Benefit Results Blueprinting brings engineering discipline to strategic planning and identifies the underlying, enabling technologies to implement the strategies. Page 11
  • 12. Business, Systems, and Technical Blueprints articulate the linkage between business strategies and IT assets Business • Strategic Business The Business Architecture describes and Architecture Architecture interrelates mission, vision, goals, Business Driven Technology Strategy • Operational Business Architecture and strategies with core processes, constituents, and interactions. The Systems Architecture Systems • Process Architecture describes, in a platform • Application Architecture Architecture • Information Architecture independent way, the high-level • Infrastructure Architecture processes, applications, data, • Integration Architecture and technology that enable the business architecture Technical • Enterprise standards and The Technical architecture services Architecture describes the Architecture • Domain level physical physical implementation of the inventories and wiring diagrams technology, including standards Blueprints provide the foundation for creating an actionable EA and therefore, an actionable IT Strategy Page 12
  • 13. The blueprinting process delivers both current and future state views of the business and supporting systems The Current State Architecture provides the The Future State Architecture defines the context for designing the To-Be solution target architectural solution Business Architecture Systems Architecture Roadmap 1H05 2H05 1H06 2H06 Theme 1 Theme 2 Theme 3 Initiative 01 Initiative 12 The Roadmap provides an Initiative 04 actionable way to move from the Initiative 07 Current State to the Future State Initiative 09 solution and articulates the costs Initiative 02 and benefits of the future state Initiative 03 architecture Initiative 05 Initiative 08 Technical architecture (standards and reference architectures) are delivered as part of the projects identified in the roadmap. Page 13
  • 14. Blueprints are created in an incremental fashion, accumulating until the entire enterprise is described Enterprise Business Domains / LOBs Project / Release Domain 1 models Project / Release Architecture Project / Release Architecture Project / Release Architecture Domain 2 models Project / Release Architecture Enterprise level models Project / Release Architecture Project / Release Architecture ... Domain n models Project / Release Architecture Project / Release Architecture Project / Release Architecture EA Repository Developing a full enterprise architecture takes time, as various models are developed in an incremental fashion. Page 14
  • 15. Agenda IT Strategy Enterprise Architecture IT Strategy & EA in Action Appendix – DiamondCluster International Page 15
  • 16. DiamondCluster is a global management consulting firm focused on combining strong industry experience with deep expertise in leveraging the strategic value of technology Who We Are A GLOBAL FIRM serving clients in over 35 COUNTRIES We have OVER 600 PROFESSIONALS in 10 offices across North America, Europe and Latin America Our SERVICE OFFERINGS build new strategic capabilities and create business/IT alignment to ensure successful implementation and achievement of business objectives STOCKHOLM DÜSSELDORF CHICAGO BOSTON LONDON How We Work MÜNCHEN PARIS We deploy SMALL, MULTIDISCIPLINARY teams of LISBOA BARCELONA experienced professionals SAN FRANCISCO MADRID NEW YORK We have strong INDUSTRY PRACTICES to ensure experience in specific industries: insurance is our SÃO PAULO largest industry practice Page 16
  • 17. Our firm is uniquely positioned in the management and advisory space – combining business strategy and information strategy with strong insurance industry expertise Strategy & Analytics Traditional Strategy Consultants DiamondCluster: Business and Technology Strategy Functional or Industry-Specific Ex Big 5 Consulting Consultants Practices Execution Systems Integrators/Outsourcers Business Operations Technology We believe that combining deep industry expertise, change management leadership and information technology skills is critical to creating and sustaining high-performing business models and innovative customer value propositions. Page 17
  • 18. We support this positioning with a distinct way of deploying our people and working with clients Small, experienced, MULTIDISCIPLINARY teams Staffing Model Integrated, collaborative, and hands-on approach to problem solving and delivery Deep skills in analytics, technology, business operations, and transformation Experience Level PRAGMATIC AND OBJECTIVE advice Informed and unbiased recommendations No incentive to recommend specific products or services Practical solutions, grounded in reality Rapid delivery of TANGIBLE RESULTS AND MEASURABLE VALUE Staffing Levels 4-16% improvement of annual EBITDA 60-70% improvement in delivered project value Diamond vs. standard 15–25% reduction in IT operating costs pyramidal staffing model 30–45% improvement in IT productivity Collaboration between a small, senior and objective DiamondCluster team and the client personnel, results in greater value and lasting impact. Page 18
  • 19. The work we do addresses the key issues faced today by senior executives Helping clients address the KEY ISSUES Service Offerings existing at the intersection of BUSINESS OPERATIONS and TECHNOLOGY IT Assessment & Strategy Strategic Architecture How can I best align my technology investments with business strategy and goals? PMO Set-Up and Execution How can I use technology to reach and serve my Technology Transformation customers better? Reduce my supply chain costs? IT Outsourcing Advisory How can I use customer data to reduce churn and increase market share? Customer Service Excellence Can I use technology to organize my firm differently? Customer Relationship Management Can my technology platform support growth plans? Operations Improvement How can I use technology to put more power in my management control systems? New Growth How do I ensure IT project delivery success? Customer Value Management Should I outsource? What, when and how? Multi-Channel Management DiamondCluster helps clients ask and answer the right questions and then find and successfully implement optimal solutions. Page 19