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1. Article The Methodology for Business Transformation v1.5: A Practical Approach to Segment Architecture By Colleen Coggins and Jerad Speigel Abstract This article describes the Methodology for Business Transformation v1.5 and how it can be used as a step-by-step approach for developing architecture. The recent publication of OMB’s Federal Enterprise Architecture (FEA) Practice Guidance clearly articulates the inter-relationships between the three architecture levels: enterprise, segment, and solution. This article introduces the MBT v1.5 as a practical approach to developing these architecture levels with executive and mission area leadership, participation, and buy-in. This article is written to encourage federal and private sector architecture practitioners to use the MBT in their own organizations. The MBT is freely available as an open-source methodology. It is available at www.doi.gov/ocio/architecture/mbt. Keywords enterprise architecture, segment architecture, solution architecture, business transformation, methodology, FEA Practice Guidance INTRODUCTION of the segment architecture layer and its relationship to enterprise and solution Throughout the U.S. Federal Government there architecture layers. The OMB guidance outlines has been a great deal of discussion of, and an overarching model, while giving agencies the focus on, transformation. This transformation is flexibility necessary to develop and implement being influenced by the President‟s segment architectures that reflect their unique Management Agenda (PMA), legislation, organizational cultures. In fact, the guidance shrinking budgets, social trends, and judgments states that it: “is not meant to be prescriptive, but by Federal Courts. These and other factors to offer concepts to be applied using a variety of have increasingly caused Federal Agencies to architectural frameworks and methodologies.” use a structured Enterprise Architecture (EA) approach to planning their transformation efforts. The U.S. Department of Interior (DOI) has However, the strongest driver for EA within any utilized a segment architecture approach to given agency is to improve service delivery and business transformation since 2004. DOI‟s overall performance within the agency‟s segment architecture approach is in full business segments. The principal challenge alignment with OMB‟s newly published FEA facing today‟s chief architects is to institute an Practice Guidance, (Figure 1) which summarizes EA program that is able to coordinate the three levels of architecture and the sustainable changes throughout the enterprise, distinctions between these levels. DOI‟s while simultaneously mentoring the specific Methodology for Business Transformation (MBT) transformation planning that is needed to version 1.5 is designed to work across all three support the mission. levels by defining business-driven segment architectures, and ensuring that each segment The U.S. Office of Management and Budget architecture seamlessly aggregates up to the (OMB) recognizes the formidable challenges EA, and finally extending the segment facing chief architects of Federal Agencies at the architectures with corresponding solution enterprise, segment, and solution architecture architectures in order to achieve measurable levels. In response, OMB published the FEA results. Practice Guidance (OMB, 2006) which is an excellent reference tool that outlines the concept © Journal of Enterprise Architecture – May 2007 1
Figure 1: Architecture Levels and Attributes (from OMB‟s FEA Practice Guidance) In 2004, DOI‟s leadership made the conscious that it needed to transform in manageable decision to segment its enterprise and to business segments rather than attempting to transform the high priority segments while “boil the ocean”. DOI‟s Investment Review maintaining consistency and coordination with Board (IRB) leads the decision-making process an enterprise vision for the future. Figure 2 that selects which business areas will be studied shows that DOI is one of the most diverse for modernization via the EA blueprinting federal agencies and as such, DOI recognized process (Coggins, 2006). Count of Services for Citizen Sub-Functions for Cabinet Agencies 25 20 15 10 5 0 Figure 2: Count of Services to Citizen Sub Functions for Cabinet Agencies Source: Update to the Report on Information Technology (IT) Spending for the Federal Government. DOI moved to a segment architecture approach terminology. DOI developed its concept of by first defining its business areas, a term used business areas to help support its synonymously with OMB‟s “segment” transformation-oriented culture. Like many © Journal of Enterprise Architecture – May 2007 2
complex organizations, DOI had the executive solution to replace the 90 legacy systems and and managerial commitment to improve their sub-systems. The implementation of the target business areas but needed a concrete state solution is well underway as demonstrated mechanism to systematically focus, coordinate, by the successful phase 2 deployment of this analyze, develop, and implement the enterprise solution. Department‟s transformation initiatives. Also like many complex organizations, DOI had to initiate DOI developed the Methodology for Business processes that brought planning functions Transformation (MBT) in 2004 in order to (workforce, strategic, process, technology) manage the development of its architecture and together to produce measurable results. The related transformation initiatives (Coggins, development of the DOI Business Areas model, 2006). Since 2004, many segment architectures and the shift to a segmented architecture have been defined and many lessons learned approach to transformation, helped DOI assign have been collected. In an effort to always resources to analyze high priority business improve its own internal approach to EA and to areas. This shift in thinking also helped solidify make lessons learned available, DOI has business executive support for resulting recently published the MBT version 1.5. transformation initiatives, making it easier for the EA team to convey measurable goals, and for As with MBT version 1.0, the new version 1.5 is the EA team to support executive decision a publicly available, step-by-step approach that making associated with modernization. is transferable and usable within any federal EA program. It not only supports the development The result of this shift in architecture philosophy and implementation of segment architectures as is an EA program that supports DOI business described by OMB, but also incorporates the units in their efforts to achieve transformation. OMB Federal Enterprise Architecture (FEA) By narrowing the immediate focus, and Reference Models. MBT v1.5 features easy to prioritizing the transformation initiatives understand steps, work products, and training underway at any one time, the DOI governance materials for determining an organization‟s teams and executive decision makers are segments, prioritizing those segments, analyzing supported and well-informed by EA in their high priority segments, and implementing decision making and in their efforts to achieve transformation plans within each segment and measurable results that are reportable to OMB, across the enterprise. Version 1.5 of the MBT Congress, and the public at large. DOI‟s incorporates lessons that DOI‟s EA program has transformation-oriented culture is aided by the learned from applying the original MBT during chief architect, working with business leaders, the development of several segment and business leaders working with their peers in architectures. With the release of OMB‟s FEA order to architect, invest, and implement Practice Guidance, DOI encourages other transformation programs within their respective federal organizations to embrace MBT v1.5 as a business areas. With the transformation of each how-to guide for adhering to OMB‟s guidance new business area comes lessons learned that and achieving measurable results within an can be applied to the EA, other segment organization. architectures, and to DOI‟s EA methods and practices in general. METHODOLOGY One compelling example is DOI‟s successful Financial Management modernization blueprint. The MBT is simply a step-by-step process for This modernization blueprint, like all planning and implementing well thought out modernization blueprints at DOI, spells out changes within an organization. It would be a findings and specific recommendations for mistake to classify the MBT as an EA change within the business area that when methodology since it is more of a “method of implemented, translate into tangible methods”. In other words, for transformation to improvements. A key recommendation in the successfully occur, an organization needs Financial Management modernization blueprint rational, defensible methods for selecting the calls for more than 90 systems/sub-systems to segments to transform, methods for planning the be retired from the DOI inventory. This transformation, methods for tracking the recommendation is architected in the transformation progress, methods for turning the modernization blueprint with a single target-state transformation plan into solution architecture, © Journal of Enterprise Architecture – May 2007 3
and methods for implementing the methodologies that need to work together. On transformation. In addition, the EA practitioner the left side of the illustration is the MBT in its needs an understanding of how this full lifecycle top level view of 17 steps. of transformation integrates with other planning processes (e.g., strategic planning, capital MBT v1.5 consists of a hierarchy of 5 phases, planning and investment control, etc.). 17 steps, and 80 activities. The structured rigor of the MBT pays dividends in that analysts have One of the most daunting challenges is to define a repeatable process, decision makers are repeatable methods for architecture in a manner assured of quality recommendations, and that is fostered and understood by many business owners have a complete roadmap for different groups within an organization (e.g., modernization. The components of the MBT are strategic planners, enterprise architects, solution delivered in the MBT Toolkit which includes: architects, budget analysts, capital planners, and business leadership). This tall order The MBT Training Presentation requires not only a sound EA approach, but also A Guidance Document for each MBT step demands that you develop a clear and A Baseline Project Plan for the MBT compelling communications plan that is tailored to the mission and culture of your organization. Templates for the MBT Work Products For example, a military branch may draw upon examples from history that demonstrate The MBT Toolkit is available at significant transformation efforts, such as the www.doi.gov/ocio/architecture/mbt. conversion to a nuclear-powered Navy. The principles of leadership, prioritization, and An agency that is interested in MBT can access decision-making that applied to that the MBT website, download the components, transformation initiative would likely resonate and then consider how MBT can be applied in with the military support personnel charged with their own environment. It is recommended that implementing a segment EA approach for the an EA organization initially work with a single DoD. Every department and agency has business segment with which it has an historical and cultural points of pride that can be established relationship. The EA practitioner mined as a rich source of examples to can use the MBT Training Presentation as a demonstrate that today‟s transformation leaders starting point for assembling a small outreach are the heirs and stewards of the transformation briefing to business segments and then use the that has come before. As the MBT was baseline project plan for MBT to lay out the introduced at DOI, the “culture-specific” timeline and needed resources for communications about EA was one of the critical modernization. As the transformation project success factors used to receive agency-wide progresses through Steps A, B, and C in the buy-in to the approach. MBT, executive sponsorship is obtained and a core team of business representatives for the The MBT was initially developed and continues modernization planning is formed. EA to be improved so that the disparate planning practitioners can continue through the MBT by groups within an organization can be on the studying the white papers which provide step- same page, working from a common by-step instructions for completing the levels of understanding of the linear steps necessary to analysis. effect change. Figure 3 on the next page is an illustration of this concept. On the right side of the figure is a linear representation of the many © Journal of Enterprise Architecture – May 2007 4
Figure 3: MBT as a Method-of-Methods © Journal of Enterprise Architecture – May 2007 5
OVERVIEW OF THE MBT: phases show the method of methods at a top Phases, Steps, Activities, and Outputs level. The MBT v1.5 is a hierarchy of phases, steps, Phase 1 begins with and activities that produce outputs that yield the determination of decisions and results. This hierarchy is which business areas conceptually illustrated in Figure 4 below. The (segments) should be decomposition from phases to steps to activities studied in order to serves the dual purpose of providing various develop modernization levels of guidance for EA practitioners while also recommendations. The making the MBT easier to understand for structured approach to segment owners. Within each step in the MBT, selecting segments to there are activities that produce work products. modernize is based on The work products are designed to help the the performance and business leadership make decisions about spending within each transformation as well as to help the governance business segment. teams provide oversight of the transformation The performance process. Ultimately, the final output is results such as measurable results for the affected segment and Performance and its enterprise level organization. Accountability Reports (PAR) and Program It is important to note that the MBT is highly Assessment Rating configurable to the business segment‟s needs. Tool (PART) are used DOI has shaped a variety of architecture to determine the services around the MBT. EA practitioners performance of segments. Financial outlays deliver these services by leveraging some or all from budget and IT spending from Exhibit 53s of the MBT in order to deliver the architecture are used to determine segment spending. In information that is needed by the business general, higher spending and lower performing segment. For instance, an EA practitioner would segments are prioritized higher for use all phases and steps in the MBT to develop modernization need. a full modernization blueprint, but would only use some phases and steps in the MBT to The MBT continues with Phase 2 which is deliver a strategic planning service to a business focused on preparing for the blueprint. This segment. phase is focused on educating executive leadership on the resource commitments necessary. It entails developing and obtaining approval of purpose statements and commitment agreements for the development of the blueprint and the selection of an executive sponsor. It should be noted that no blueprint should commence (i.e., enter phase three) without an executive sponsor. An executive sponsor should be someone who has demonstrated leadership and core responsibilities within the business area under consideration, is respected within the business area, and exhibits a desire and vision to Figure 4: MBT Hierarchy and Outputs modernize. Executive sponsorship is critical as the modernization process has many barriers and the core team needs leadership to The MBT can most easily be learned by first overcome those barriers. The bottom line is that considering the phases and then working to you can‟t drag an executive sponsor to the table; learn the steps and then activities. The following the executive sponsor must want to be there to figure shows the five phases of the MBT. Similar foster change. to what has previously been discussed, the © Journal of Enterprise Architecture – May 2007 6
The last piece of business in Phase 2 is the remain flat and the challenges of delivering on selection and training of the core team. The core the mission remain high, the business areas with team should consist of business subject matter completed architectures and well-conceived experts who are responsible for the execution of transition plans will likely have greater the business area itself. This team would not successes with their budget and investment generally include IT specialists or support staff justifications. resources; however those resources would be consulted, as needed, by the core team as Phase 4 includes steps and activities for subject matter experts. It is important that the performing a more detailed analysis that results core team be comprised of representatives from in the detailed solution architecture for the the actual business area so that the segment recommendations outlined in the modernization architecture is truly business sponsored, driven, blueprint. Note that the detailed solution owned, and championed. The architects architecture developed in step 4 is based on the themselves are a support mechanism for the conceptual solution architecture outlined in step core team. The architects are positioned to 3 and included in the modernization blueprint. guide the core team through the MBT, to Prior to the detailed solution architecture facilitate working sessions with the core team, to development, the MBT includes steps for more document architecture information and closely analyzing the processes and data decisions, and to help formulate the standardization necessary for implementation. modernization blueprint and associated outreach This phase also includes guidance for creating materials. The architects are not the segment an investment business case (OMB Exhibit 300) leads nor are they representatives of the for implementing the recommendations in the business area. modernization blueprint. The final outputs of this phase include the development of the detailed Phase 3 comprises the actual analysis that solution architecture and the implementation of results in the modernization blueprint (i.e., the modernization blueprint recommendations. segment architecture and conceptual solution architecture) as well as the integration of the Lastly, Phase 5 provides steps and activities for segment architecture into the overall enterprise maintaining the blueprint in the context of the architecture. This phase includes the key data overall EA. This phase includes the collection and analytical steps such as maintenance of the segment, enterprise, and stakeholder interviews and strengths, solution architecture layers associated with the weaknesses, opportunities and threats (SWOT) business area. This phase also includes the analysis, which yields the performance maintenance of the enterprise transition strategy architecture for the business area. The and plan that is originally updated in phase 3. performance architecture is then used to As blueprints are implemented and results are determine the specific business products and achieved, Phase 5 is designed to maintain the services that will be delivered by the business architecture information so that reporting to area. Additionally, the human capital necessary governance and oversight bodies is more easily to deliver the business products and services is produced. a critical point of analysis that often yields recommendations. Once the business As previously stated, the MBT decomposes from architecture is established, the solutions space phases into steps. Figure 5 on the next page is analyzed to determine the conceptual solution shows the 5 MBT phases on the left and the architecture (e.g., technology, newly-trained corresponding MBT steps on the right. There personnel) that is needed to enable the are 17 MBT steps that together provide a lower business. Lastly, the findings and level of guidance than the phases. Recall that recommendations are analyzed against one the MBT was designed and developed to be a another to determine the relative value, risks, usable, how-to guide for architecture that can be and costs for each recommendation. The final readily understood by the business community. findings and recommendations are authored into As a result, the language used at the phase and the modernization blueprint as well as detailed step levels are absent of architecture and views of the transition plan and resource technical jargon. estimates for implementation. As budgets © Journal of Enterprise Architecture – May 2007 7
Figure 5: Methodology for Business Transformation (phases on the left and steps on the right) In order to view segment architecture previously stated, DOI has been following a information that has been produced with the segment architecture approach that is in full assistance of the MBT, you are encouraged to alignment with OMB‟s newly published FEA visit the DOI enterprise architecture website at Practice Guidance. The MBT is designed to www.doi.gov/ocio/architecture. You will find accommodate all three levels of architecture that publicly available information on MBT, as well as were previously described in Figure 1. Table 1 segment architectures such as Financial on the next page details the mapping between Management, Recreation, Law Enforcement, this OMB guidance and the MBT. More and Wildland Fire. importantly, the table shows that by following the MBT, an architecture practitioner will be working through the architecture levels and will be in FOLLOWING SEGMENT ARCHITECTURE compliance with OMB‟s most recent architecture GUIDANCE THROUGH MBT v1.5 guidance. The DOI EA program continues to innovate and improve the way in which it approaches and performs its architecture responsibilities. As © Journal of Enterprise Architecture – May 2007 8
TABLE 1: Mapping of OMB Guidance to MBT v1.5 Architecture Level from OMB MBT Steps Decisions Practical Results Guidance Agency leadership has Step A: The enterprise direct input into the leadership is guided to look segments to be studied. across the enterprise to This garners executive identify the highest priority buy-in for the MBT Steps segments. Enterprise modernization blueprint(s). A, 6 Step 6: The segment architects integrate the No new silos. The completed segment segments within the architecture into the published enterprise are integrated. enterprise architecture. The selection of an executive sponsor from the ranks of the segment Steps B-C: The segment community ensures that leadership is bought into the the modernization transformation and commits blueprint will be business resources. An executive driven. An architect in the sponsor is selected and the driver‟s seat is the first core team is formed. sign of a study that is not driven by the business MBT Steps community. B-C, 1-5 The defined target state Segment will encompass changes (FEA: PRM, The segment is studied by that span more than just BRM, SRM, working through Steps 1-5 of IT. The achievement of TRM, DRM) the MBT. These steps feature results is linked to decisions such as determining participation and the high priority stakeholders, enthusiasm of the core the future products and team developing the services, the right blend of modernization blueprint. human capital, and the The core team should appropriate levels of keep the study grounded technology enablement for the and ensure that a set of segment. practical and actionable recommendations are set forth. © Journal of Enterprise Architecture – May 2007 9
Segment architecture is only paper without the detailed solution MBT Steps The segment architecture is architecture. The solution 7-13 analyzed in more detail and architecture is a silo the specifics of the solutions without the segment and Solution (FEA: PRM, are decided. MBT Steps 7-13 enterprise architectures. BRM, SRM, also help decide funding The inclusion of solution TRM, DRM) sources and business cases. architecture guidance within the MBT ensures that the levels of architecture are integrated. CONCLUSION How do I integrate EA with CPIC and OMB‟s FEA Practice Guidance is a jump forward solution architecture? for architecture in the federal sector. The OMB How do I drive change as a Chief Architect? guidance includes core philosophies that should be embraced by the architecture community. MBT v1.5 has been released to provide federal The excerpt below is a direct quote from the architecture practitioners with an approach to FEA Practice Guidance: answering the “how” questions in order to achieve results. There is wide-spread “Business-led architecture is more successful agreement that participation in architecture in meeting strategic goals, responding to extends beyond the practitioners to the business changing mission needs, and serving community. There is wide-spread agreement citizens‟ expectations than technology- or that architecture should be business-driven and budget driven architecture. This principle produce business benefits. MBT v1.5 provides encourages agency architects to proactively the step-by-step, repeatable process by which collaborate with business stakeholders to the EA community can resolve the “how” develop architecture work products for a questions and engage business segments in segment. Architects must understand the transformational planning with measurable current state of the business and where the results. business stakeholders would like to make improvements. With this shared DOI has completed several segment understanding, architects and business architectures. More importantly, DOI has stakeholders can work together to develop achieved true business participation and the architecture work products supporting executive sponsorship for its modernization better investment and implementation blueprint implementations. More than 100 decision-making.” legacy systems are slated for retirement and DOI has recognized cost avoidance that In the current EA community, the excerpt above exceeds 5% of its Fiscal Year 2006 IT budget. and the core premise that architecture is about DOI has long preached “actionable architecture” achieving results is widely accepted. However, and MBT v1.5 is designed to ensure that many architects still struggle to answer the architecture delivers tangible, reportable results. question of “how”: How do I get my business community You can download the MBT components at involved? www.doi.gov/ocio/architecture/mbt. How do I know what to study? How do I turn artifacts into decisions? AUTHOR BIOGRAPHIES How do I use my resources to affect Colleen Coggins change? Colleen Coggins is the Chief Architect for the Department of the Interior (DOI) and has overall © Journal of Enterprise Architecture – May 2007 10
responsibility Interior‟s Enterprise Architecture Office of Management and Budget (2002). The Program. Through Ms. Coggins‟ leadership, President’s Management Agenda. Fiscal Year Interior has been recognized as leader in EA as 2002. evidenced by Interior winning the „Excellence in Enterprise Architecture‟ award by the E-Gov Office of Management and Budget (2006). Institute in 2004 and 2006. Under her Consolidated Reference Model (CRM) Version leadership, DOI‟s EA has also received the 2.1. December 2006. highest score in the U.S. Federal Government for its EA maturity by the Office of Management Office of Management and Budget (2006). FEA and Budget (OMB) and the General Accounting Practice Guidance. December 2006. Office (GAO) in 2006. Ms. Coggins has lead the development of modernization blueprints for key Office of Management and Budget (2007). Interior lines of businesses which define a Update to the Report on Information Technology roadmap for minimizing redundant systems, (IT) Spending for the Federal Government. enhancing data sharing, and incorporating Fiscal Year 2007. proven state-of-the-art technologies while reducing costs and improving services to the United States Department of the Interior (2006). citizen and DOI‟s business partners. Colleen Methodology for Business Transformation v1.5. has a B.S. in Engineering and a M.S. in December 2006. Computer Systems Management. She‟s also a Certified Enterprise Architect from the FEAC Institute. Jerad Speigel email@example.com Mr. Speigel's experiences have spanned the public and private sectors with concentrations on strategy consulting, organizational development, enterprise architecture, and solution design. Most recent experiences have involved the combination of enterprise architecture and strategy consulting to help define and foster business transformation within the public sector. Mr. Speigel is a Partner with Phase One Consulting Group, Inc. based in Alexandria, Virginia. In addition to providing professional services, Mr. Speigel lectures at the USDA Graduate School in the areas of enterprise architecture and communications. Mr. Speigel has a Bachelor‟s degree in Finance and an M.B.A. from Texas Christian University. REFERENCES Coggins, C. (2006). Journal of Enterprise Architecture. Department of the Interior: A Practical Approach to Enterprise Architecture – Part 1. February 2006. Coggins, C. (2006). Journal of Enterprise Architecture. Department of the Interior: A Practical Approach to Enterprise Architecture – Part 2. May 2006. © Journal of Enterprise Architecture – May 2007 11