Add new definition Architecture & Business Architecture (Niki)
-> Business architecture ties together a diverse ecosystem that represents an enterprise from different perspectivesThese include goals, strategies, and tactics; subsidiary entities, business units and teams; semantics and rules; capabilities and processes; initiatives, programs and projects; and customers, partners and suppliers.We call those “artefacts,” and along with the relationships among these artefacts, these are called the building blocks of an architectureBy utilizing a common approach to represent the various business artefacts, business architecture makes visualizing complex business ecosystems a reality.The business architectural model is translated into different views within the business domain of an organisationwe will explain each of these views more in detail by the structure of this temple.As you can see the temple is divided into different structural blocks such as the roof, the pillars, the foundation,……Each of these parts do have a meaning within the business architectural framework and are taken up in a specific business view which we will explain in the next slides The area around the temple: external factors The roof: the mission The construction block underneath the roof: goals & objectives The next construction block: value proposition The three pillars: the operational model
Business Architecture& OperationalExcellenceA Marriage Made in Heaven?Banking & Finance SeminarPeter Knaepkens, Niki Serruys & Stephan PodevynDate: 31/05/2012
2Introducing ourselves … … and Projective Projective focuses on Project and Program Management for the financial sector: banks, insurance companies and market infrastructure players. Peter Knaepkens Project Manager The majority of our consultants have extensive experience in Project Management and over ten years seniority in Banking and Finance. Projective helps Financial Institutions define and design their Target Operating Model, Niki Serruys linking Business Architecture (processes) to Project Manager the underlying applications and infrastructure. By doing this FSIs create greater transparency and traceability between Business and IT which is a key success factor in achieving large change initiatives. We also assist our clients with installing a permanent governance Stephan Podevyn around their Architecture. Project Manager
3Sounds familiar?Business processes are executed inconsistently between teams, persons and therefore often underperform. Process knowledge is limited to specific process parts (silos). Business processes are often task oriented and application dependent. Internal controls are not embedded in the process creating efficiency leaks. Roles and responsibilities within the organization are not clearly defined and internal SLAs are not respected. Projects are not delivering what was required by the business and clients. Business requirements are not clearly defined allowing ICT to be in the driving seat for projects. Transformation of processes and systems require huge efforts and produce disproportional costs for individual business streams.
4Years of growth have had a strange effect on organizations …
5 Architecture: the BasicsArchitecture • An architect designs and supervises the construction of buildings or other large structures. • Architecture is about managing complexity and setting boundaries: budget, scope and time. • Architecture deals with constraints and structures reality.
6Business Architecture offers a framework for transforming acompany’s strategy into an adequate Operating Model External Factors Mission Goals & Objectives Value Proposition Target Operating Model - Process model - Organisation model - Information model
7The Target Operating Model defines how a company organizesitself to execute strategy & meet the current/future challenges Value Proposition Value Proposition: The Value Propositions Building Block describes the bundle of products and services that create value for a specific Customer Segment It defines how the company will offer its products and services to the different client segments through the different channels Target Operating Model Process model Organization model Information modelProcess: Describes how processes are Organization: Provides an overview of Information: Gives a static map of therun at the company at a conceptual and how the company’s functions and roles are different information objects (and theirlogical level and how responsibilities are hierarchically structured definitions)assigned
8Achieving Operational Excellence starts with detailing theTOM… Target Operating Model Product Development & Management Pensions Marketing Sales Distribution Support Idea Generation Product Monitoring Leads Generation & Marketing Intelligence Marketing Communicati on & Services & Remuneration Contracting Lead Management Channel Marketing PR Calculate Remuneration Due Diligence Strategic Objectives Sales Force Network & Bonuses Product Feasibility Product Portfolio Strategic Leads Generation Customer Insights Media Strategies Brand Marketing Management System Activation Management Recommendations Process Cost Sales Force Recruitment Declarations Product Design & Pricing Market & Consumer Customer End Relationship Monitoring & Needs Local & Agent Marketing Local Sponsorship Public Relations & Training Research and Analysis Intelligence Identification Pay -out Contract Step by Step Sales CRM Capabilities & Data Corporate Social Channel Management Product Implementation Customer Advocacy Internet Marketing Monitoring of Product Cycle Support Management Responsibility Content Quality Contact Data Administrative Support Contract Maintenance Technical Implementation Marketing Support for Global Brand & Maintenance Review of Product Brokers, Banks, Direct Sponsorship Commercial Implementation Commercial Support Related OPS Processes Relationship Development Maintenance Product Development & Management Risk Management IT Relationship Management Customer Contact HR Savings/Investments & Protection Underwriting & RE Risk Management Infrastructure Architecture Service Management Remuneration Manpower Planning Management Organisation Customer Inquiries Enterprise Architecture Market Risk Management Hosting & Housing Relationship Termination Culture Idea Generation Product Monitoring Delivery Management Customer Complaints Operations & Solution Architecture Value chain (level 1) Balance Sheet Maintenance Management Training & Development Product Feasibility Product Portfolio Configuration & Change Data Architecture Service Management Client Data Maintenance Operational Risk Management Management Management Compensation & Benefits Incident & Problem Business Architecture Reporting Facility Management & Support Product Design & Pricing Monitoring & Needs Risk Modelling & Management Target Operating Model ICE – Value Chain View Identification Concepts Infrastructure Performance Management Coordination with BU Rent - HO & Agencies Incoming Documents Product Implementation Monitoring of Product Support & Helpdesk Architecture Credit Risk Content Quality Technical Implementation Application Development Finance Management Occupancy Services Communication Business Risk Outgoing Documents Inventory Management & Maintenance HO & Agencies Review of Product Commercial Implementation Administration Related OPS Processes Software Development Reinsurance Security Motor Fleet Archiving General Administration Reinsurance Negotiation Underwriting Pensions Testing & QA & Contracting 1. Product 4. Channel 6. Commercial 7. Policy 9. Customer Contact Asset Management 2. Marketing 3. Sales 5. Underwriting 8. Claims Management Payroll Development Management Administration Administration Management Data Entry Acceptance Maintenance Access Management Reinsurance Billing Develop Investment Monitor Portfolio Strategy Performance Requirement Investigation Contract Issuance Security Management Legal Reinsurance Reporting Strategic Planning Management Maintain Investment Approve Reserving Network Methods Contract Negotiations Reinsurance Billing & Collection Finance Perform Investment Perform Contract Facility Management & Support Analysis Valuations Intellectual Property Finance & Accounting Decision Support Processing Underwriting Savings/Investments & Protection Protection Business Improvement Services Expense Develop Portfolio Maintain Customer Fund General Accounting Treasury Planning Structure Accounts Legal Advice Reimbursements Data Entry Acceptance Procurement & Vendor Management Financial Policies & Accounts Payable Business Improvement Services Finance Reporting Budgetting Procedures Management Processing Litigation Resolution Legal Investigation Contract Issuance Project Management Regulatory Reporting Cost Management Forecasting Tax Finance Portfolio Management Tracking & Reporting Reinsurance Billing & Collection Compliance Tax Reporting 2. Defining how the parts of Performance Risk Management Capital Allocation Cost Accounting Measurement Resource Management Project Management Ensure Compliance Policy Administration Pensions Tax Advisory Reinsurance Administrative Procurement & Vendor Endorsements Business Process Changes Business Consultancy Asset Management Improvement Management Procurement Billing & Collection Statement Generation Compliance General Management Demand management Claims Management Legend Business Service HR Cancellations Surrenders/Maturities Claim Notification Pay -outs General Management Procurement Execution Sub Services IT Vendor Management the VC should be sourced Policy Administration Savings/Investments & Claim Investigation Reinsurance Collection 1. Making sure OPEX is derived General Management Protection Cluster of Activities Administrative Endorsements Changes Billing & Collection Statement Generation Cancellations Surrenders/Maturities from a company’s strategy Conceptual processes Process: Switch Funds DRAFT FOR DISCUSSION 3. Removing waste from Agent Client Broker Bank Employee Customer/Intermediary assurance Customer Access wants to Enter Switch Fund Funds Manager XOR switch data updated funds Paper channel Web channel - Portal Phone channel Electronic channel processes & standardizing Data complete No Client Agent Broker Bank Other & correct? Scanning / ICR IVR / Phone E-mail / fax /SMS portlet portlet portlet portlet portlets Submit Request Request Confirm fund XOR Cancel Request for further analysis Closed switch Yes Business Process Manager Business Processes Customer Contact Identity Manager 5.1. Inquiries Authentication & Authorization Services ESB Info Hub Load services Service Service Service Service Service Service Business Services Transform services Integration Services (messaging, orchestration, transformation, etc) Exrtact services User Meta Information Apply switch 4. Aligning Business & IT Yes XOR Yes Directory received? charges No Queue fund switch Life Policy Business Rules Actuarial Document Policy Administration Maximum free Analyse requests switches exceeded ? No XOR Administration request Engine Services Composition Request extra Policy Yes information Administration Document Business Rules Business Rules User Funds Services Composition Rules CIF Provisioning No updated Yes Pending Yes 5. Consolidating service XOR Extra information Trades? necessary ? Pension Policy Document Distribution Client Information Finance Administration management Mgmt Services Open pending Policy Document Request Create fund switch Send Confirmation Switch Fund No Administration Management Distribution Financial Services approved? record Letter Services Request Services Services Local user Local user components directories directories Send rejection Request No letter closed Document Agency & CIF Policy data Data storage commission Stores Client Directory data Asset Mngt 13.9. Agent Directory Investment XOR Logical processes IT Architecture
9 Business Architecture Maturity Model: most FSI are at level 1 or 2 Dimension Level 1 Level 2 Level 3Defining architecture Architecture as a project Architecture as a process Architecture as a facilitating processUse of architecture Architecture is used informatively Architecture is used for steering Architecture embedded in the design organizationInvolvement of business Architecture related to business Architecture driven by business Architecture process integrated goals goals in businessInvolvement within development Ad hoc Structural InteractiveprocessRelation to current situation Attention to current situation Attention to migration Attention to migrationRoles and responsibilities Responsibility for architectural Management responsible for Top management responsible content assigned architecture process for architecture effectivenessCoordination of activities Steering per project Coordination between projects Coordination between projectsMaintenance architecture process & Maintenance is fragmented Maintenance procedures Continuous processproducts available improvement & Maintenance Policy availableArchitecture roles and training Role recognized Role described Role supported & appreciatedUse of architecture method Project specific Organization generic Method optimizationConsultation Internal architecture meetings Meeting commissioners and Organization wide discussion of users the quality of the architecture processArchitecture tools Ad hoc and product centred Structural and process oriented Integrated tools
10Workshop:What are the most important roadblocks preventing FinancialInstitutions – YOU - to achieve a mature Business Architecture?• “We have no time!”• “We have no money!”• “We don’t see the (immediate) benefits!”• “We can’t decide where to start & who should sponsor this initiative!”• “There is no common opinion about definitions & scope of BA!”• “We have tried this before, doesn’t work!”• “We are happy with what we got!”
11 APPENDIX: Business Architecture Maturity Level Dimension DescriptionDefining architecture Architecture development approaches vary between isolating, autonomous projects and a continuous facilitating process. In the first case architecture is seen as a product, in the second case as a processUse of architecture Developing an architecture is not a goal in itself. Architecture has to be used in an organization to achieve something. Architecture can be used in various ways: purely informative, to guide individual projects, or as a management instrument for the complete organization.Involvement of business Architecture finds its justification in enabling the realization of business goals. It is important to synchronize the architecture content with business goals and capabilities. Cooperation between architects and business lines is a necessityInvolvement within development process Architecture needs to steer changes to optimize the realization of business goals. Cooperation with the development process, the relationship between the architecture process and the development process, is very important. This holds for process-, organization- and IT-developmentRelation to current situation Architecture is often associated with a new, desired situation. But organizations also have the current situation. It is important for architecture to consider this current situation with its challenges and opportunities. This will enhance the applicability of the architecture. If the current situation is neglected, chances are that the organization can only dream the architects dreamRoles and responsibilities Clear assignment of architecture roles and responsibilities will prevent architecture discussions and differences of opinion from not being addressed, and ending up in an organizational vacuum. Furthermore parties can be hold accountable for their contribution to the architectureCoordination of activities Within an organization there are often many different developments which are undertaken simultaneously. These developments share resources, and are often depending on each others results. Architecture can be used for coordination of dependencies and can help project prioritization Source: Sogeti
12 APPENDIX 1: Business Architecture Maturity Level Dimension DescriptionMaintenance architecture process & products It is not sufficient to deliver architecture products like principles, guidelines and models. They need to be maintained: new insights are included, and what has become out-dated is deleted.Architecture roles and training Being an architect is a demanding profession. The architect not only needs to develop architecture products, but also needs to have knowledge of process and system development and infrastructures. And (s)he needs strong interpersonal and managerial skills. This makes training a necessity.Use of architecture method Developing architecture is done by a methodology using activities, techniques, tools and products. When this method varies over time or user, or when parts of it need further detailing before they can be applied, the usability of the method is limited.Consultation The development of architecture asks for extensive consultation with various stakeholders, like business managers, process owners, information managers, project managers and IT staff. An orchestrated exchange of ideas is an important part of the architecture process. It ensures that the architecture is based on business requirements, and that the architecture products are accepted by the organization.Architecture tools The architecture process can be supported by tools. When they are used in an integrated fashion, preferably supported by a repository, their effectiveness and efficiency is at the highest. Provided, of course, that the tools are suited to the chosen architecture method Source: Sogeti