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Integrated Approach to Enterprise Architecture Governance
 

Integrated Approach to Enterprise Architecture Governance

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The management processes and control mechanisms of IT governance are inadequate for holistic governance of enterprise architecture. Whereas IT governance primarily focuses on running daily IT ...

The management processes and control mechanisms of IT governance are inadequate for holistic governance of enterprise architecture. Whereas IT governance primarily focuses on running daily IT operations, EA is primarily focused on designing the future state of architecture in support of business. IT governance frameworks such as CobiT define policy development and good practice for IT control, but EA still calls for comparable governance measures. While EA approaches increasingly address Business Architecture, EA has not yet infiltrated into strategic level corporate decision-making. There is a need for EA governance that transcends traditional IT governance and addresses the strategic, forward-looking aspects of EA. This presentations puts forward an integrated approach to Enterprise Architecture Governance that supports, bridges and extends extant ITG and EA frameworks to govern both business and IT architectures.

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  • The management processes and control mechanisms of IT governance are inadequate for holistic governance of enterprise architecture. Whereas IT governance primarily focuses on running daily IT operations, EA is primarily focused on designing the future state of architecture in support of business. IT governance frameworks such as CobiT define policy development and good practice for IT control, but EA still calls for comparable governance measures. While EA approaches increasingly address Business Architecture, EA has not yet infiltrated into strategic level corporate decision-making. There is a need for EA governance that transcends traditional IT governance and addresses the strategic, forward-looking aspects of EA. This presentations puts forward an integrated approach to Enterprise Architecture Governance that supports, bridges and extends extant ITG and EA frameworks to govern both business and IT architectures.
  • The five components are the following:Control environment: The control environment sets the tone of an organization, influencing the control consciousness of its people. It is the foundation for all other components of internal control, providing discipline and structure. Control environment factors include the integrity, ethical values, management's operating style, delegation of authority systems, as well as the processes for managing and developing people in the organization.Risk assessment: Every entity faces a variety of risks from external and internal sources that must be assessed. A precondition to risk assessment is establishment of objectives and thus risk assessment is the identification and analysis of relevant risks to the achievement of assigned objectives. Risk assessment is a prerequisite for determining how the risks should be managed.Control activities: Control activities are the policies and procedures that help ensure management directives are carried out. They help ensure that necessary actions are taken to address the risks that may hinder the achievement of the entity's objectives. Control activities occur throughout the organization, at all levels and in all functions. They include a range of activities as diverse as approvals, authorizations, verifications, reconciliations, reviews of operating performance, security of assets and segregation of duties.Information and communication: Information systems play a key role in internal control systems as they produce reports, including operational, financial and compliance-related information, that make it possible to run and control the business. In a broader sense, effective communication must ensure information flows down, across and up the organization. For example, formalized procedures exist for people to report suspected fraud. Effective communication should also be ensured with external parties, such as customers, suppliers, regulators and shareholders about related policy positions.Monitoring: Internal control systems need to be monitored—a process that assesses the quality of the system's performance over time. This is accomplished through ongoing monitoring activities or separate evaluations. Internal control deficiencies detected through these monitoring activities should be reported upstream and corrective actions should be taken to ensure continuous improvement of the system.

Integrated Approach to Enterprise Architecture Governance Integrated Approach to Enterprise Architecture Governance Presentation Transcript

  • Integrated Approach to Enterprise Architecture GovernanceThe Open Group Conference, April 28, 2010
    Janne J. Korhonen
    Requisite Remedy
  • Preface to Presentation
    Diaspora of Business and IT
    Traditional notions of corporate and IT governance
    Fundamental system perspectives: black box and white box
    Enterprise Governance = conformance + performance
    Requisite Organization as metadesign
    The paradigm shift: beyond a single organization
    Agile Governance ModelTM
    Linking EA and IT Governance
  • Business-ITDivide
  • IT people are
    from Mars
    Business people
    think they should
    stay there
  • Nothing is as dangerous in architecture as dealing with separated problems. If we split life into separated problems we split the possibilities to make good building art.
    − Alvar Aalto (1898−1976)
  • Corporate GovernanceTraditional Definitions
    ”The process by which corporations are made responsive to the rights and wishes of stakeholders.”
    – Demb and Neubauer (1992)
    “Corporate governance deals with the ways in which suppliers of finance to corporations assure themselves of getting a return on their investment.”– Shleifer and Vishny (1997)
    “Corporate governance is about how suppliers of capital get managers to return profits, make sure managers do not misuse the capital by investing in bad projects, and how shareholders and creditors monitor managers.” – American Management Association
  • Specify Financial
    Reporting Objectives
    Internal Controls and COSO (Commission of Sponsoring Organizations of the Treadway Commission)
  • IT Governance Traditional Definition
    “IT governance is the responsibility of executives and the board of directors, and consists of the leadership, organisational structures and processes that ensure that the enterprise’s IT sustains and extends the organisation’s strategies and objectives.”– IT Governance Institute; CobiT 4.1 (2007)
  • Business-IT Alignment
  • Basic CobiT Principle
    drive the
    investment in
    that are
    used by
    CobiT
    that areused by
    to deliver
    Source: CobiT 4.1
  • CobiT Follows Top-Down Approach
    Source: CobiT 4.1
  • Conformance
  • Is this enough?
  • Fundamental System Perspectives
    ”Black Box”
    Functional
    Teleological
    Control-oriented
    Design irrelevant
    ”White Box”
    Constructional
    Ontological
    Change-oriented
    Design essential
  • Performance
  • Enterprise Governance: Broader Definition From More White Box Perspective
    Enterprise Governance
    “The set of responsibilities and practices exercised by the board and executive management with the goal of providing strategic direction, ensuring that objectives are achieved, ascertaining that risks are managed appropriately and verifying that the organisation’s resources are used responsibly.”
    − Information Systems Audit and Control Foundation (2001)
    Corporate Governance
    i.e. Conformance
    Business Governance
    i.e. Performance
    Accountability
    Assurance
    Value Creation
    Resource Utilisation
    Source: IFAC (2004)
  • Enterprise Governance: My Definition
    Enterprise Governance defines the requisite roles, accountabilities and policies to effectively design and operate an enterprise in continually shifting contexts.
    The word governance derives from the Greek verb κυβερνάω [kubernáo]: to steer
  • VII-VIII Long-term sustainability
    V-VI Innovation, transformation
    III-IV Effectiveness
    Board Member,
    Super Corporation CEO
    I-II Efficiency
    VI+ Executive Leadership
    Strategic organizational leadership: culture, values, vision; business portfolio
    VIII
    Conceptual-Abstract
    Dialectical
    VII
    Corporate CEO
    Corporate EVP
    VI
    Business UnitPresident
    V
    IV−V General ManagementBusiness models,
    products, services
    General Manager
    IV
    Symbolic-Verbal / Logical
    III
    Unit Manager
    I−III Operations
    Day-to-day work, supervision, first-line management, departmental management
    First-Line Manager;Specialist
    II
    I
    Supervisor; Operator
    Requisite Organization as Metadesign
    • Service-Dominant
    • Organismic
    • Holistic
    • Dynamic
    • Emergence
    • Coordination
    • Post-Formal
    • Dialectical
    Complexity
    Effectiveness
    Integrity
    • Goods-Dominant
    • Mechanistic
    • Reductionistic
    • Static
    • Planning
    • Control
    • Formal
    • Logical
    Efficiency
    • Business Technology
    • Value Creation
    • Performance
    • Business-IT Convergence
    • Interactions
    • Informated
    • In the Cloud
    Complexity
    Effectiveness
    Integrity
    • Information Technology
    • Cost Containment
    • Compliance
    • Business-IT Alignment
    • Transactions
    • Automated
    • On the Ground
    Efficiency
  • Stratified Approach to Achieve Concurrent Objectives
    Scope of Modern Enterprise Architecture, Governance and Management
    Scope of Traditional IT Architecture, Governance and Management
  • Agile Governance Model 1.1
    Strategic
    Steering
    Strategic,external
    StrategicDecision-Making
    Enterprise
    Coordination
    Strategic,internal
    Tactical Decision-Making
    Domain Coordination
    Tactical
    Operational Decision-Making
    Operations
    Planning &
    Support
    Operational
    Real-Time
    Development and Execution
    Design, Planning and Support
  • EA Governance
    Strategic,external
    Strategic,internal
    Tactical
    Operational
    Real-Time
    Positioning EA Governance
    Effectiveness
    IT Governance
    Efficiency
    Development and Execution
    Design, Planning and Support
  • Linkages Within and Between EA and IT Governance
    Architectural linkages
    EA office
    Guidelines, principles, policies
    Approval mechanisms
    Operational linkages
    Business sponsors
    Process owners
    Project reviews
    Balanced scorecard
    Service-level agreements
    Alignment linkages
    Architecture contracts
    Compliance assessments
    Architecture support to projects
    EA Governance
    Alignment linkages
    Architectural linkages
    Operational linkages
    IT Governance
  • Traditional EA Approach: Architectural Dimensions as Layers
  • From Layers to Slices: Stratification by Decision-Making Perspectives
    External
    Strategic
    Internal
    Tactical
    Operational
    Real-Time
    Technology
    Business
    Information
    Information
    Systems
  • Prelim: Framework and Principles
    TOGAFDefinesa Methodology:ADM
  • Pertinent Governance Levels for TOGAF Artifacts
  • AGM Applied to EA and ITG
    Strategic Alignment, Strategic Architecture
    Strategic,external
    Segment Architecture
    Value Delivery, Risk Management, IT Project Portfolio Management
    Strategic,internal
    Capability Architectures
    Resource Management, Performance Measurement, IT Program Management
    Tactical
    IT Architecture, Architectural Support
    IT Project Management, IT Operational Mngt, Arch. Realization
    Operational
    Real-Time
    Development and Execution
    Design, Planning and Support
  • Three Takeaways
    ”Mind the Gap”
    Do not just align business and IT; converge them
    Design for concurrent objectives
    Use requisite stratification as guiding metadesign
    Do not turn EA upside down
    Just 90 degrees
  • http://www.requisiteremedy.com/