Time to be a Business Architect
Prof. Bala Iyer
Twitter: @BalaIyer
2Time to be a Business Architect
Contents
• Technology Trends
• Why care about architecture?
• How to transform architectu...
3Time to be a Business Architect
• A business architect understands the emerging technology trends and uses them to
innova...
4Time to be a Business Architect
Dawn of the network era
• Atoms to bits
• Everything is connected
• Network effects --Win...
5Time to be a Business Architect
Disruptive Innovation
Clayton Christensen, HBS Professor
6Time to be a Business Architect
Technologies at Work
6
7Time to be a Business Architect
Remember
7
• It’s important when discussing technology to
ask what business problem is it...
8Time to be a Business Architect
Evolving IT StackEvolving IT Stack
Hardware
Software
Intelligence/Services/Analytics
Clou...
9Time to be a Business Architect
Trends
9
1. Arrival of Utility Platforms and platform based competition 
Agility
2. Digi...
10Time to be a Business Architect
Utility Platforms
10
• Social
• Commerce
• Analytics (measurement)
• Open source
• Criti...
11Time to be a Business Architect
Digital Spaces
11
• Digital identity
• Digital influence
• Virtual workforce
• Sharing e...
12Time to be a Business Architect
Personalization -- Analytics
12
• Data is the currency, insight is the goal
• Critical C...
13Time to be a Business Architect
Networked World --Social Networks
13
• Wielding digital influence
• Building social capi...
14Time to be a Business Architect
Democratization of knowledge
14
• MOOCs
• Blogs, Twitter, discussion boards
• On the job...
15Time to be a Business Architect
Transparency -- Knowledge is Power
15
• Meritocracy rules
• Distributed management
• Cri...
16Time to be a Business Architect
Edge Economy
16
• Decision rights reside where they have the best access to customer inf...
17Time to be a Business Architect
Video
Source: Startup Owners Manual, presentation by Steve Blank
18Time to be a Business Architect
Question
• Consider each trend discussed
• How does it affect Cumming’s business model?
...
19Time to be a Business Architect
Healthcare in transition
20Time to be a Business Architect
Automotive industry in transition
100 million lines of code
21Time to be a Business Architect
New Context for every Company
Operating in the New Context Demands a Business
Architect
22Time to be a Business Architect
New Language for Architectural Thinking
• Ecosystem
• Industry Stack
• Competitors, comp...
23Time to be a Business Architect
Ecosystem
Loose networks – of suppliers, distributors,
outsourcing firms, makers of rela...
24Time to be a Business Architect
M-payment Stakeholders
• Platform provider
• Network Operators
• Banks
• Credit Card Iss...
25Time to be a Business Architect
Modularity, interoperability and loose coupling are desirable properties
Key Design Conc...
26Time to be a Business Architect
Design process
• A design process is a set of activities that starts
with someone’s prob...
27Time to be a Business Architect
Why design?
• Design before you build
• Have a model to understand and respond to change...
28Time to be a Business Architect
Buildings Without Architecture:
The Winchester Mystery House
Number of rooms: 160
Cost: ...
29Time to be a Business Architect
What is Architecture?
• Architecture: specifies what modules will be part of the system ...
30Time to be a Business Architect
Elements of Architecture
Principles
Policies
Architectural
Frameworks and Strategies
Pro...
31Time to be a Business Architect
Business Architecture
• We define business architecture as the set of
design rules, poli...
32Time to be a Business Architect
Business Architect
• The role of the business architect is to
collaborate with the leade...
33Time to be a Business Architect
Competencies
• Understand and deploy the economics of networks,
clouds, and business pla...
34Time to be a Business Architect
Designed
Architecture
Emergent
Architecture
Architecture
Gap
Expected
Value
Realized
Val...
35Time to be a Business Architect
• If you were implementing analytics at Cummings, how
would you apply design thinking?
•...
36Time to be a Business Architect
...why Does Architectural Thinking Fail?
• Requires buy-in and collaboration across proj...
37Time to be a Business Architect
Another weapon to use while innovating around
Business models is APIs or interfaces
38Time to be a Business Architect
Tech definition:
An Application Programming Interface is a way for
two computer applicat...
39Time to be a Business Architect
Consider this:
60%+ traffic through APIs
More bandwidth through APIs than all the
websit...
40Time to be a Business Architect
41Time to be a Business Architect
API progress
• 1990s -APIs was the sole province of operating
system vendors -- IBM, Mic...
42Time to be a Business Architect
Emergence of a new role -- Developer
43Time to be a Business Architect
Developers now sit between you and your customers
and innovate for end users
They are li...
44Time to be a Business Architect
ConsumerRetail StoreProducer
20th
Century: Packaged
Goods
21st
Century: Internet
Service...
45Time to be a Business Architect
Key Takeaways
• Technology based innovation can be learned by analogy
• Architectural Th...
46Time to be a Business Architect
Q & A
Questions?
47Time to be a Business Architect
• API pricing link
• Forget “post-PC”—pervasive computing and cloud will change the natu...
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Time to be a Business Architect

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Time to be a Business Architect

  1. 1. Time to be a Business Architect Prof. Bala Iyer Twitter: @BalaIyer
  2. 2. 2Time to be a Business Architect Contents • Technology Trends • Why care about architecture? • How to transform architecture? • IT architecture concepts (city planning analogy, managed evolution) • What to measure about architecture? • Metrics • Future - BONUS!! API
  3. 3. 3Time to be a Business Architect • A business architect understands the emerging technology trends and uses them to innovate on existing business models. • To be a business architect: • Understand technology trends • Identify current business models • Lear to apply concepts like: • Ecosystems • Industry stack • Platforms • APIs Business Architect
  4. 4. 4Time to be a Business Architect Dawn of the network era • Atoms to bits • Everything is connected • Network effects --Winner-take-all markets • Service-oriented thinking • Warrants strategic consideration • Strategic errors can be costly • Requires a different lens
  5. 5. 5Time to be a Business Architect Disruptive Innovation Clayton Christensen, HBS Professor
  6. 6. 6Time to be a Business Architect Technologies at Work 6
  7. 7. 7Time to be a Business Architect Remember 7 • It’s important when discussing technology to ask what business problem is it solving • Padmasree • Chief Technology and Strategy Officer for Cisco.
  8. 8. 8Time to be a Business Architect Evolving IT StackEvolving IT Stack Hardware Software Intelligence/Services/Analytics Cloud Users Social Gaming Behavioral Change Layer Mobile 8 Social Mobile Analytics Cloud
  9. 9. 9Time to be a Business Architect Trends 9 1. Arrival of Utility Platforms and platform based competition  Agility 2. Digital spaces -- Disintegration of organizational boundaries  Cost savings 3. Sensors  Personalization -Information explosion  Big Data and Analytics  Customer satisfaction 4. Connected world  Era of Networks  Access to resources 5. Democratization of knowledge  Learning organization 6. Age of Transparency  low coordination costs 7. Edge Economy  Production to consumption logic  Innovation • Era of the Entrepreneurial Leader
  10. 10. 10Time to be a Business Architect Utility Platforms 10 • Social • Commerce • Analytics (measurement) • Open source • Critical capability: Culture of fast experiments • Reward: Agility Platform-based competition is the norm with dominant winners and role players We are moving from the internet economy to the App economy
  11. 11. 11Time to be a Business Architect Digital Spaces 11 • Digital identity • Digital influence • Virtual workforce • Sharing economy • Critical Capability: Navigation • Rewards: Cost Savings, innovation Digital natives are forming a larger portion of the working economy and enforcing their values
  12. 12. 12Time to be a Business Architect Personalization -- Analytics 12 • Data is the currency, insight is the goal • Critical Capability: Sense making • Rewards: Customer Loyalty Data is back in vogue and a key source of competitive advantage
  13. 13. 13Time to be a Business Architect Networked World --Social Networks 13 • Wielding digital influence • Building social capital • Strength of weak ties • Critical Capability: Architectural control • Rewards: Access to resources Connections are the new wealth, isolation is the new poverty.
  14. 14. 14Time to be a Business Architect Democratization of knowledge 14 • MOOCs • Blogs, Twitter, discussion boards • On the job learning • Develop spectrum of skills • Learn how to learn (know, do, be) • Build identity • Critical Capability: Information Quality Filters • Rewards: Learning organization BRIC nations are using smart devices to overcome the digital divide and join the knowledge economy
  15. 15. 15Time to be a Business Architect Transparency -- Knowledge is Power 15 • Meritocracy rules • Distributed management • Critical Capability: Principles driven management • Rewards: Low overheads
  16. 16. 16Time to be a Business Architect Edge Economy 16 • Decision rights reside where they have the best access to customer information. • Critical Capability: Learning from users • Rewards: Innovation
  17. 17. 17Time to be a Business Architect Video Source: Startup Owners Manual, presentation by Steve Blank
  18. 18. 18Time to be a Business Architect Question • Consider each trend discussed • How does it affect Cumming’s business model? • Can you think of a company exploiting that business trend? • What value can it provide to Cumming’s?
  19. 19. 19Time to be a Business Architect Healthcare in transition
  20. 20. 20Time to be a Business Architect Automotive industry in transition 100 million lines of code
  21. 21. 21Time to be a Business Architect New Context for every Company Operating in the New Context Demands a Business Architect
  22. 22. 22Time to be a Business Architect New Language for Architectural Thinking • Ecosystem • Industry Stack • Competitors, complementors, infrastructure providers, platform providers, and orchestrators • Business model innovation • API and Modularity • Cloud
  23. 23. 23Time to be a Business Architect Ecosystem Loose networks – of suppliers, distributors, outsourcing firms, makers of related products or services, technology providers, and a host of other organizations – that affect, and are affected by the creation and delivery of a company’s own offerings. [Marco Iansiti]
  24. 24. 24Time to be a Business Architect M-payment Stakeholders • Platform provider • Network Operators • Banks • Credit Card Issuers • Device Manufacturers • Merchants • Users 24
  25. 25. 25Time to be a Business Architect Modularity, interoperability and loose coupling are desirable properties Key Design Concepts • Design • Designs are the instructions based on knowledge that turn resources into things that people use and value • Modularity • Degree to which a system’s components can be separated and recombined [Schilling 2000] • A module is a unit whose structural elements are powerfully connected among themselves and relatively weakly to elements in other units [Clark and Baldwin] • Interdependence within and independence across modules • Abstraction, information hiding, and interface • Interoperability • The ability of two or more systems or components to exchange information and to use the information that has been exchanged • Business Models • Alignment
  26. 26. 26Time to be a Business Architect Design process • A design process is a set of activities that starts with someone’s problem and then devises an architecture and artifact to solve the problem.
  27. 27. 27Time to be a Business Architect Why design? • Design before you build • Have a model to understand and respond to changes – move from as-is to to-be • Theory /business model or a road map of your assumptions about the business • Design can be conscious or un-conscious • Facilitate communication of strategy and intent
  28. 28. 28Time to be a Business Architect Buildings Without Architecture: The Winchester Mystery House Number of rooms: 160 Cost: $5,500,000 Date of Construction: 1884 - September 5, 1922 (38 Continuous years!) Number of bedrooms: approx. 40 Number of kitchens: 5 or 6 Number of staircases: 40, total stair steps - 367 Blueprints available: No, Mrs. Winchester never had a master set of blueprints, but did sketch out individual rooms on paper and even tablecloths!
  29. 29. 29Time to be a Business Architect What is Architecture? • Architecture: specifies what modules will be part of the system and what their functions will be, given design rules • Architecture has: • Interfaces: describe in detail how the modules will interact, including how they fit together and communicate • Standards: test a module’s conformity to design rules and measure the module’s performance relative to other modules. Architecture wins technology wars
  30. 30. 30Time to be a Business Architect Elements of Architecture Principles Policies Architectural Frameworks and Strategies Processes Standards Detailed Design Specifications Conceptual Logical Physical What artifacts are used at various levels?
  31. 31. 31Time to be a Business Architect Business Architecture • We define business architecture as the set of design rules, policies, and key decisions that position the firm in a business network in a way that allows it to design the best business model.
  32. 32. 32Time to be a Business Architect Business Architect • The role of the business architect is to collaborate with the leaders of the firm to interpret how business architecture both creates and/or constrains the ability of the firm to achieve its business network strategy. • From a skills perspective, a business architect can negotiate strategic, technical and change management issues.
  33. 33. 33Time to be a Business Architect Competencies • Understand and deploy the economics of networks, clouds, and business platforms as an essential element of the justification of business networks • Define a coherent architecture control strategy that is both feasible and defendable in a complex business network • Redefine what constitutes the core systems of the firm
  34. 34. 34Time to be a Business Architect Designed Architecture Emergent Architecture Architecture Gap Expected Value Realized Value Guides Projects Design of system Implementation System use Gives rise to Value Gap It is Ongoing.. • Espoused • Is this what we communicate? • Emergent • Is this what really matters?
  35. 35. 35Time to be a Business Architect • If you were implementing analytics at Cummings, how would you apply design thinking? • What goals would you set? • What are the different components? • What principles would you implement? • What outcomes would you measure? Question
  36. 36. 36Time to be a Business Architect ...why Does Architectural Thinking Fail? • Requires buy-in and collaboration across project teams and business units • Lack of communication between technologists and strategists • Compromise must be brokered in terms of time lines and choices • Senior management often lacks enough understanding to evaluate the value of architecture
  37. 37. 37Time to be a Business Architect Another weapon to use while innovating around Business models is APIs or interfaces
  38. 38. 38Time to be a Business Architect Tech definition: An Application Programming Interface is a way for two computer applications to talk to each other over a network (predominantly the Internet) using a common language that they both understand. Business definition: A way to get your data to partners and apps. Essentially a contract. What is an API? Amundsen’s Dogs, Information Halos, and APIs The epic story of your API strategy Sam Ramji, @sramji, Apigee
  39. 39. 39Time to be a Business Architect Consider this: 60%+ traffic through APIs More bandwidth through APIs than all the websites Entirely API based product and ecosystem 30% of primetime internet traffic through streaming service managed by APIs API drives all forms of distribution - website, apps, partners Amundsen’s Dogs, Information Halos, and APIs The epic story of your API strategy Sam Ramji, @sramji, Apigee
  40. 40. 40Time to be a Business Architect
  41. 41. 41Time to be a Business Architect API progress • 1990s -APIs was the sole province of operating system vendors -- IBM, Microsoft, Apple, Red Hat, etc. • 2000s - Internet-centric companies such as eBay, Amazon, and Netflix began exposing their information assets through APIs. • 2010s- traditional brands -- such as Mastercard, Comcast, USA Today, The New York Times, Best Buy, and others
  42. 42. 42Time to be a Business Architect Emergence of a new role -- Developer
  43. 43. 43Time to be a Business Architect Developers now sit between you and your customers and innovate for end users They are like the retail store in the value chain developers Amundsen’s Dogs, Information Halos, and APIs The epic story of your API strategy Sam Ramji, @sramji, Apigee
  44. 44. 44Time to be a Business Architect ConsumerRetail StoreProducer 20th Century: Packaged Goods 21st Century: Internet Services ConsumerDeveloperProvider App Amundsen’s Dogs, Information Halos, and APIs The epic story of your API strategy Sam Ramji, @sramji, Apigee
  45. 45. 45Time to be a Business Architect Key Takeaways • Technology based innovation can be learned by analogy • Architectural Thinking is necessary for business model innovation using technology • The building blocks for such thinking are business models, ecosystems, industry stack, platforms and APIs • Managed evolution, a methodology for architecture transformation, is based on managing an architecture by identifying stable business domains and services • Transformation of architecture can require several years, but will create significant improvements in business flexibility and cost position
  46. 46. 46Time to be a Business Architect Q & A Questions?
  47. 47. 47Time to be a Business Architect • API pricing link • Forget “post-PC”—pervasive computing and cloud will change the nature of IT link • The Paris Guide to IT architecture by Jürgen Laartz, Ernst Sonderegger, and Johan Vinckier, McKinsey Quarterly, Number 3, 2000. link Reference

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