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B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 1
BUSINESS BY DESIGN
OCTOBER 2015
Craig Martin
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 2
DISCIPLINE CONFUSION
CONFUSION REIGNS AROUND WHICH DISCIPLINES ARE USED
FOR WHAT SITUATIONS
STRATEGIC PLAN MARKETING PLAN
OPERATIONAL
PLAN
DELIVERY
& EXECUTION OPERATIONS
Planning Delivering Operating
PORTFOLIO, PROGRAM AND PROJECT MANAGEMENTBUSINESS ARCHITECTURE
ENTERPRISE ARCHITECTUREPRODUCT & SERVICE DESIGN
BUSINESS PLANNING SOLUTIONS ARCHITECTURE
SOLUTIONS DEVELOPMENT
ENTERPRISE DESIGN
BUSINESS ANALYSIS
Environment analysis / SWOT,
competitor / Business motivation /
Product and portfolio analysis / Strategic
Options
Market analysis and forecasting Model the business / Evaluate and
select strategy / Risk and funding
analysis
Project, portfolio and program
management, solutions delivery
Daily operations,
run the business
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 3
SOLVING PROBLEMS
ABSTRACT
CONCRETE
Insight:
“I want a beautiful
environment”
Opportunity:
Paint the wall,
Move, Buy new
furniture, Hand a
picture
Problem
Statement:
“I need a hole”
Solution Statement:
“I need a drill”
PROBLEM SOLUTION
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 4
THE EMERGENCE OF ENTERPRISE DESIGN
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Understanding the
problem from a
human centred
perspective
Prototyping and
testing for
disruptive options
Understanding
drivers, pressures,
environment and
working out
motivation
Developing operating
models and solutions
DESIGN
THINKING
ARCHITECTURE
THINKING
ENTERPRISEDESIGN
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 5
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Understanding the
problem from a
human centred
perspective
Prototyping and
testing for
disruptive options
Understanding
drivers, pressures,
environment and
working out
motivation
Developing operating
models and solutions
NAVIGATING THE QUADRANTS
APPROACHES TO CHANGE
SOLUTION FOCUSSED
TRANSFORMATION
FOCUSSED
DISRUPTION
FOCUSSED
DELIVERY FOCUSSED
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 6
DESIGN MINDSET
UNCERTAINTY / PATTERS / INSIGHTS CLARITY / FOCUS
RESEARCH CONCEPT DESIGNPROTOTYPE
DISCOVER DEFINE DEVELOP DELIVER
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 7
ABSTRACT
CONCRETE
PROBLEM SOLUTION
NAVIGATING THE QUADRANTS
APPROACHES TO CHANGE
DISCOVER DEFINE DEVELOP DELIVER
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 8
…	a	discipline	that	uses	designer’s	sensibility	and	
methods	to	match	people’s	needs	with	what	is	
technologically	feasible	and	what	a	viable	business	
strategy	can	convert	into	customer	value	…	Tim Brown, CEO, IDEO
DESIGN THINKING DEFINITION
›  Quoted from ‘The Design of Business’, Roger Martin
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 9
THREE LENSES OF HUMAN CENTRED DESIGN
Start	Here
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 10
DECISIONS ABOUT ‘PROBLEMS’
‘A Leader’s Framework for Decision Making’ David Snowden & Mary Boone
Unknowable:
The relationship between cause
and effect is impossible to determine as
they constantly shift. In chaos, it is
necessary to act first and then sense
through the result of action how to further
respond. Understanding the problem
comes later. This is the domain of rapid
response.
Example: Natural disasters
Unknown Problems:
The problem is in constant flux as a
change to the situation causes ripple
effects and unpredictability
in other aspects. Information is often
incomplete. Rather than implementing a
solution, devising a concept, testing,
iterating and then responding is needed.
Problems often become complex when
human behaviour is a significant factor.
This is the domain of emergence.
Example: Schooling experiences,
organisational change management,
traffic management
Known unknowns:
A complicated problem can have multiple right
solutions. Complicated problems are understood,
analysed and then responded to. It often requires
expertise to solve and is largely process driven.
Solving a complicated problem often requires the
right expertise along with the right tools. In this
realm you may know you have a problem but may
not be able to solve it alone. This is the domain of
expertise.
Example: Fixing a car, constructing an aeroplane.
Known knowns
A simple problem is one of cause and effect. The
solution is rarely disputed. The problem can be
categorised, understood and a response devised
based on the information. This is the domain of
best practice.
Example: 1+1 = 2, solving a jigsaw puzzle.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 11
FOUR ORDERS OF DESIGN
›  Business Design,
›  Organisation Design
›  Service Design, UX Design,
Instructional Design,
›  Process Design
›  Richard Buchanan, (1992) Wicked Problems in Design Thinking
›  Product Design, Engineering,
Architecture
›  Graphic Design, Visual
Design
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 12
BUSINESS PREDILECTION
›  ‘The Design of Business’, Roger Martin
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 13
TOOLS FOR BUSINESS DESIGN: A SELECTION
›  DISCOVER
›  Literature Review
›  Time Machine
›  Shadowing
›  Touchstone Tours
›  Service Safari
›  A Day in the Life
›  Diary Studies
›  The Five Whys
›  Journey Maps
DEFINE
Mapping Complex
Situations
Stakeholder Map
Customer Persona
Empathy Mapping
Mind Mapping
Scenarios
Affinity Mapping
How Might We
DEVELOP
Bodystorming
Collaborative Ideation
Co-creation
Storyboards
Image Boards
Prototyping
Heuristic Evaluation
Critique Circle
DELIVER
Rapid Iterative Testing
A/B Testing
Usability Testing
Ergonomic Analysis
Value Opportunity
Analysis
Feedback Review
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 14
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Problem Definition
Influencers
Values
Drivers
Value System Engineering
Business Scenario
Value Proposition
Business Model Canvas
Business Motivation
Model
Value Chain
Capabilities
Cross-Functional Capabilities
Capability Overlays
Roadmap & Planning
MOVING THROUGH THE QUADRANTS
DISCOVER DEFINE DEVELOP DELIVER
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 15
THE VALUE CYCLE
THE QUICKEST WAY TO GET ADOPTION FOR COMPLEX
ORGANIZATIONS
What is
value?
How is value
created?
How is value
measured
and reported
on?
How is value
delivered?
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 16
YOU CANNOT DEVELOP MOTIVATION OR HYPOTHESES WITHOUT
FIRST UNDERSTANDING VALUE
ALIGNING VALUE TO PERFORMANCE
BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT
Process Performance
Indicators
PRODUCT
DEVELOPMENT
RETAIL SALESRETAIL PLANNINGSOURCING
Objectives Drive Key Performance Indicators (SMART)
Financial
Operational
Data
Quality
Indicators
Business Flows
FLOW OF GOODS, FLOW OF MONEY, FLOW OF INFORMATION
VALUE CHAINS / CROSS FUNCTIONAL CAPABILITY / VALUE STREAMS
Critical Success Factors
Strategic Business Goals
Value Monitoring
VALUEREPORTINGPERFORMANCEREPORTING
Performance
Monitoring
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 17
UNDERSTANDING THE DIMENSIONS OF
VALUE AND PERFORMANCE
AND REALISING THESE THROUGH THE INFORMATION MANAGEMENT DISCIPLINE
What value is
created?
How is value
created?
How is value
measured?
BUSINESS
SERVICES &
SPI’S
BUSINESS
PROCESSES &
PPI’S
OBJECTIVES &
KPI’S
BUSINESS
GROUP CSF’S
BUSINESS AREA
STRATEGIC
GOALS
ENTERPRISE
STRATEGIC
GOALS
Increase Turnover
Customer Service:
Increase Customer
Satisfaction
Customer Group:
Improve Self Service
Customer Group:
Improve telephone
support
KPI: Customers may
be diverted by a
maximum of 3 times
KPI: Customers shall
wait no longer than 2
minutes
PPI: Time from
reception to customer
handling
SPI: Service Quality
measured in
customer satisfaction
DQI: Data quality
measured in
customer to product
alignment
Accounting: Reduce
administration costs
Sales: Increase new
customers into retail
outlets
Capture customer
details and product
category prior to
handling
VALUE REPORTING
PERFORMANCE REPORTING
CAPABILITY: PEOPLE, PROCESS, TOOLS, DATA
STRATEGIC REPORTING
& DECISION MAKING
OPERATIONAL REPORTING & DECISION MAKING
STRATEGIC / EXECUTIVE SCORECARDS
OPERATIONAL COCKPITS
TACTICAL
REPORTING &
DECISION MAKING
MGMT. DASHBOARDS
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 18
Increase price
Increase volume
Improve mix
Improve process
Reduce cost of inputs
Improve warehouse utilisation
Increase productivity
Decrease staffing
Optimise scheduling
Optimise physical network
Decrease staffing
Use alternative distribution
Lower Customer Service & Order
Management Costs
Lower I/S costs
Lower Finance / Accounting
costs
Lower HR costs
Improve capital planning/
investment process
Reduce inventories
Reduce A/R increase A/P
•  Profit-driven marketing efforts:
•  Target “best” customers
•  Offer “best” product mix
•  Improve pricing management
•  Proactive production planning for
inventory management
•  Most profitable capacity allocation/
utilisation
•  Reduced sales management layers
•  Focus on high-profit accounts
•  Improved inventory flow visibility
•  Lower transportation costs
•  Higher facilities utilisation
•  Less “fire fighting”
•  Better carrier evaluation/
management
•  Higher quality Customer Service
•  Improved Supply Chain visibility
•  Improved order fill rates
•  Significantly lower cost
•  More consistent service
•  Faster problem resolution
•  Improved capital stewardship
•  Increased capital productivity
•  Reduced inventory investment
•  Reduced receivables investment
o  Automated PO requisitions
o  Improved information for
evaluating vendors
o  Automation of some scheduling
functions
o  Single point of entry eliminates
data re-entry and improves
accuracy
o  Faster data reconciliation
o  Automated billing processes
o  Automated payroll processes
o  Moderately lower safety stock
inventory
o  Moderately improved A/R and A/P
management
Increase
revenues
Decrease costs
Reduce selling
costs
Reduce
distribution costs
Reduce
administrative
costs
Increase
gross profit
Decrease
operating
expenses
Capital
deployment
Cost
of capital
Increase net
operating profit
after tax
(NOPAT) (I/S)
Improve capital
allocation (B/S)
Enterprise
Value
Map
BUILDING VALUE MODELS
USING DRIVER TREES VALUE LEVERS
TRANSFORMATION
BENEFIT (Outcome)
AUTOMATION BENEFIT
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 19
VALUE IS ACHIEVED THROUGH COHERENCY
Companies with a High Level of Cohesion affect EBIT Directly
4%
8%
12%
16%
20%
24%
28%
32%
0 20 40 60 80 100 120
EBITMARGIN,2003-2007
CAPABILITIES COHERENCE SCORE
COCA-COLA
WRIGLEY
PEPSICO
KIMBERLY-CLARK
SARA LEE
CONAGRA MERCK
UNILEVER
H.J. HEINZ
KRAFT
GENERAL MILLS
CLOROX
CAMPBELL SOUP COMPANY
P&G
*Adapted From “The Coherence Premium” – Harvard Business Review, June
2010
A	coherent	organiza.on	is	
one	that	is	thought	of	and	
executed	as	a	whole
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 20
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Problem Definition
Influencers
Values
Drivers
Value System Engineering
Business Scenario
Value Proposition
Business Model Canvas
Business Motivation
Model
Value Chain
Capabilities
Cross-Functional Capabilities
Capability Overlays
Roadmap & Planning
MOVING THROUGH THE QUADRANTS
DISCOVER DEFINE DEVELOP DELIVER
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 21
WHEN DOES DISRUPTION OCCUR?
›  First stage of disruption, an innovator
makes a product that is much more
affordable and simpler to use (for the user)
than what currently exists.
›  The second stage of disruption is when
additional technological change is added
which makes it simpler and less expensive
to build and maintain the products.
›  The new change eventually displaces the
existing market and value network,
resulting in a radical improvement in
performance.
Disruptive technologies take a while to change the market
Christensen, Clayton M. (2010-09-06).
Disrupting Class, Expanded Edition: How Disruptive Innovation Will Change the Way the World Learns
PERFORMANCE
TIME
market
Market for old
technology
Market for new
technology
New replaces
old technology
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 22
‘Enterprise Lifecycle's
2014 © Enterprise Architects PTY LTD
PERORMANCE
TIME
ENTERPRISE
BRAND PLATFORM
BUSINESS MODEL
BUSINESS CAPABILITIES
PRODUCT
DISRUPTIVE FORCES REQUIRE US TO
RE-INVENT AT A NUMBER OF LEVELS
Organisations…and architects
need to be able to provide the
means to enable this change
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 23
VALUE SYSTEM DESIGN
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 24
THE KNOWLEDGE
FUNNEL
Non-core but complex -
Outsource
Innovation, chaos &
unresolved mysteries
HIGH
HIGH
LOW
LOW
Must be done but adds little value to
product or services
Very important to success, high value added to
products and services
STRATEGIC IMPORTANCE & VALUE
COMPLEXITYANDDYNAMICS
Complex negotiation, design,
or decision process
Many business rules;
expertise involved
Some business rules
Procedure or simple
algorithm
Non -Core
Competencies
Core Differentiating
Competencies
Everyday, highly
repeatable and
automated
Make repeatable and
reliable to gain efficiency
Core Competitive
Competencies
THE RESULTS OF DISRUPTION
THE SPEED THROUGH THE KNOWLEDGE FUNNEL IS ALSO INCREASING
Source: Adapted from “Business Process
Change” by Paul Harmon
GOAL: Reliably produce
consistent, predictable
outcomes
GOAL: Validity- Produce
outcomes
that meet desired
objectives
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 25
RE-INVENTION NEEDS TO OCCUR ACROSS
THE FULL BUSINESS MODEL.
NEW MIXES NEED TO BE IDENTIFIED
Leading and Best Practice Research, 2011/2012
Scope: 1765 CEO’s and 2936 business leaders representing all major countries and industries
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 26
THE NATURE OF INNOVATION
IMAGE	TO	BE	
MODIFIED	TO	
INCREASE	TEXT	
SIZE
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 27
DIGITAL ECONOMY
General Principles of the Digital Economy. These are the principles of Digital Strategy Enablement
“RENEWABILITY”
You can renew data, but not exhaust it. Once created it can be used
over and over again. It is a renewable resource
“UNIVERSALITY”
Everyone can access the same data simultaneously, and use it for
a completely different reason
“MAGNETISM”
Information grows in value as more people absorb it, which, in turn,
creates a network effect, drawing more people who want to learn.
Metcalfe's law
“LACK OF FRICTION”
The more smoothly information flows, the more valuable it is.
“VULNERABILITY”
Criminals can harm or misuse information. They can destroy it, ruin it
or steal it (as in identity theft). In this one sense, data is like
physical goods
Larry Downes - Three laws direct the revolutionary changes wrought by computer technology.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 28
“THE LAW OF DISRUPTION”
The dissemination of change is “uneven.” Various elements of society
struggle to keep up with rapid technological change.
Technology changes exponentially, but social, economic and legal
systems change incrementally” and struggle to keep up.
Larry Downes - Three laws direct the revolutionary changes wrought by computer technology.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 29
DISRUPTION ALTERS ENTIRE VALUE NETWORKS
Example: Disruption will alter the entire value chain and place the student at the centre
Faculty
& Staff
CONTENT
CLASSES
SOCIAL
INTERAC
TION
LECTURE
RS
STUDENT
S
Students
& Social
Interaction
CONTEN
T
CLASSES
FACULTY
STAFF
FACILITATORS
Teach	at	SCHOOL	and	do	Homework	at	HOME	 Teach	at	HOME	and	do	Homework	at	SCHOOL
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 30
DIGITAL
DISRUPTION IS
REDUCING THE
DELAY Action Reaction
Immediate
Feedback
Delayed
Feedback
B
R
“Life	is	indeed	speeding	
up,	but	mans	ability	to	
deal	with	it,	is	slowing	
down”
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 31
THIS
ACCELERATION
IS PUTTING
PRESSURE ON
CURRENT
BUSINESS
MODELS
Technology
commoditising
from below
Business roles taking on
more architecture
accountabilities
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 32
THE RESULTS OF DISRUPTION
THE COMMODITY SPACE IS GROWING, MAKING THE DIFFERENTIATION SPACE
MORE COMPETITIVE
Non-core but complex -
Outsource
Innovation, chaos &
unresolved mysteries
HIGH
HIGH
LOW
LOW
Must be done but adds little value to product
or services
Very important to success, high value added to
products and services
STRATEGIC IMPORTANCE & VALUE
COMPLEXITYANDDYNAMICS
Complex negotiation, design, or
decision process
Many business rules; expertise
involved
Some business rules
Procedure or simple algorithm
Non -Core
Competencies
Core Differentiating
Competencies
Everyday, highly repeatable
and automated
Make repeatable and
reliable to gain efficiency
Core Competitive
Competencies
Non-core but complex - Outsource
Innovation, chaos &
unresolved mysteries
HIGH
HIGH
LOW
LOW
Must be done but adds little value to product
or services
Very important to success, high value added to
products and services
STRATEGIC IMPORTANCE & VALUE
COMPLEXITYANDDYNAMICS
Complex negotiation, design, or
decision process
Many business rules; expertise
involved
Some business rules
Procedure or simple algorithm
Non -Core Competencies
Core Differentiating
Competencies
Everyday, highly repeatable and
automated
Make repeatable and
reliable to gain
efficiency
Core Competitive
Competencies
Opportunit
y	or	
Threat?
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 33
DISRUPTION IS SHIFTING THE FOCUS TO
CUSTOMER LIFETIME VALUE
This shift is the essence of what drives the emergence of the chief digital officer (CDO). It also forces a
stronger focus on the chief marketing officer (CMO)
SELLER DRIVEN
ENTERPRISE
CUSTOMER CENTRIC ENTERPRISE CUSTOMER DRIVEN ENTERPRISE
“Maximize product
profitability”
Push Selectively Target Pull (collaboration)
DATA ANALYSIS
SERVICE Interactive & Proactive
UNDERSTANDING Segmented Individualized
CUSTOMER OFFERS Intra-enterprise bundles Inter-enterprise bundles
ORGANISATION Integrated Function Customer Outcome
CHANNELS Segment Driven Integrated and Seamless
“Maximize market
share”
“Maximize customer
lifetime value”
MARKETING
Passive & Reactive Interactive & Reactive
Insight as Art Factual insight Predictive insight
Broad
Product Driven
Singular
Functional Silo
Digital
Strategy
Focus
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 34
WHAT IS DIGITAL?
Digital is a participatory layer of all media
that allows users to self select their
own experiences and affords marketers
the ability to bridge media, gain
feedback, iterate their messages, and
collect relationships.
BUD CADDELL
Enterprise	Architects,	March	2011	 Slide	34
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 35
THE CMO AGENDA
FOCUS ON THE HERE AND
NOW…
Exploration & Validity
Produce outcomes that meet an
objective
THE CIO AGENDA
FOCUS ON LEVERAGE,
SYNERGY, LONG TERM USE OF
ASSETS…
Exploitation and Reliability
Produce consistent, predictable
outcomes
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 36
THE CUSTOMER DRIVEN SHIFT
Production Products
Selling and
Promotion
Profit
Through
sales volume
Target
individual
Customer
Intention
Outcome
Marketing
Profit through
customer
lifetime
satisfaction
The	Selling	Concept			
Product	Driven	
The	Value	Concept		Customer	Driven	
The	Marke>ng	Concept		Customer	Centric		
Target Market
Segment
Segment
Needs
Integrated
Marketing
Profit through
Increased
Market Share
The	digital	
strategy	
focus
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 37
CUSTOMER DRIVEN
AND DIFFERENT VALUE CHAINS
The Selling Concept - Product Driven
The Value Concept - Customer Driven
The Marketing Concept - Customer Centric
Production Products
Selling and
Promotion
Profit
Through
sales
volume
STARTING
POINT FOCUS MEANS ENDS
Target Market
Segment
Segment
Needs
Integrated
Marketing
Profit through
Increased
Market Share
STARTING
POINT FOCUS MEANS ENDS
Target individual
Customer
Intention
Outcome
Marketing
Profit through
customer lifetime
satisfaction
STARTING
POINT FOCUS MEANS ENDS
The customer driven shift
The digital
strategy focus
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 38
*Adapted from Geoffrey Moore’s:
Dealing with Darwin
Each industry moves along a life cycle,
with different opportunities for
competitive advantage at each stage
THE STRATEGIC
BUSINESS MODEL
Its also great for start-ups at the
early stage of the lifecycle
Introduction Growth Maturity Decline
TOTAL
INDUSTRY
REVENUE
TIME
DISRUPTOR
ENTERS
MARKET SHARE, REVENUE
& COST BECOME KEY
PRODUCT
INNOVATION
REDUCES
PROCESS INNOVATION
BEGINS
PRODUCT LEADERSHIP CUSTOMER INTIMACY
OPERATIONAL EXCELLENCE
VALUE DISCIPLINE
ORIENTATION THROUGH THE
INDUSTRY LIFECYCLE
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 39
BUSINESS MODEL EVALUATION
BUSINESS MODEL OPTIONS ARE EVALUATED AGAINST VALUE DRIVERS OR BUSINESS
MODEL MECHANICS TO DETERMINE SHORTLISTS
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 40
ARCHITECTURE DELIVERY MODELS
EVALUATION OF STRATEGIC BUSINESS OPTIONS
The capability mixes are
evaluated against each
scenario to determine
the optimal path going
forward
REQUIREMENTS: PROGRAM “X” REQUIRES A $100M 5-YEAR NET BENEFIT AND MUST BE IMPLEMENTED IN UNDER 3 YEARS.
Business	Models	
Value	Streams
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 41
UNDERSTANDING THE ENGINE TO PRODUCE THE
BUSINESS FIT
The operating model delivers the infrastructure required to deliver the products and services to the customer segments
THE ENVIRONMENT
BUSINESS MODEL
Markets
Industries
Customers
Market Segment
Channels
Customer Relationships
Value Proposition
Offering: Services/Products
Processes/ Value Chains
Capabilities
Business Service
Functions
Data
Applications
Technology
MARKET
MODEL
OPERATING
MODEL
PRODUCTS &
SERVICES
MODEL
Aligning what is valuable to the customer and what is value to the business is referred to as the business fit.
This means that the engine delivers both aspects and is the ideal mix an organization needs to engineer for.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 42
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 43
USING THE VALUE PROPOSITION CANVAS TO
DEVELOP THE SERVICE MODELS
The Value (Proposition) Map describes the features of a specific value proposition in your
business model in a more structured and detailed way. It breaks your value proposition down into
products and services, pain relievers, and gain creators.
The Customer (Segment) Profile describes a specific customer segment in your business
model in a more structured and detailed way. It breaks the customer down into its jobs, pains, and
gains.
Gain Creators describe how your
products and services create customer gains.
Pain Relievers describe how your
products and services alleviate customer pains.
You achieve CUSTOMER Fit
when your value map meets your customer profile
— when your products and services produce pain
relievers and gain creators that match one or
more of the jobs, pains, and gains that are
important to your customer.
Gain describe the outcomes
customers want to achieve or the
concrete benefits they are seeking.
Pains describe bad
outcomes, risks, and obstacles
related to customer jobs.
This is a list of all the
Products and
Services a value
proposition is built around.
Customer Jobs
describe what customers are
trying to get done in their work
and in their lives when dealing
with a problem or challenge.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 44
CUSTOMER INTERACTION ACROSS THE SERVICE
LANDSCAPE
Products and Services
Valuable to the Customer
PRODUCT N
PRODUCT I
PRODUCT TPRODUCT Y
PRODUCT K
SERVICE DSERVICE N
SERVICE H SERVICE P
PRODUCT B SERVICE N
SERVICE T
PRODUCT S
SERVICE A
PRODUCT X
PRODUCT H
SERVICE O
PRODUCT N
PRODUCT ESERVICE C
SERVICE Q
SERVICE N
SERVICE T
SERVICE B
Customer Outcome
CUSTOMER INTERACTION MAP, CUSTOMER SEGMENT ABC
Establishing my account is
quick and simple…
Integration is quick and easy,
with the right help available
Efficient, with choices that
make it convenient
I know when the shipment will
arrive
I can find out whether my
shipments were delivered;
I get a meaningful resolution
to my problem
“I want to set-up my account”
“I want to get ready to send my
products”
“I want to send a shipment”
“I need to know when my
shipment will arrive”
“I want confirmation that my
shipments have arrived”
“Something has gone wrong
with my delivery…”
% of accounts set-up in <X
hours
% of accounts that utilise
more than X
% of orders with no manual
intervention
% of articles with at least 4
scans
Service Delivery
Performance Metric
# of complaints per million
products
RESEARCH EVALUATE PURCHASE USE INTEGRATE SERVE
Value to the Business
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 45
CUSTOMER INTERACTION ACROSS THE SERVICE
LANDSCAPE
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 46
Business Motivation
Strategic Business Models
Value Discipline Orientation
Operating Business Models
Capabilities and Resources
IT’S THE STRATEGIC
BUSINESS MODELS THAT
CAN DETERMINE WHERE
VALUE LIES
O P C O P C O P C
Pe Pr T Pe Pr T Pe Pr T
LEVERS
DRIVERS
INFORMATION
Mission
Strategies
Tactics
Vision
Goals
Objectives
DISRUPTION
NORMALLY
OCCURS WITHIN
THE VALUE
SYSTEM.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 47
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Problem Definition
Influencers
Values
Drivers
Value System Engineering
Business Scenario
Value Proposition
Business Model Canvas
Business Motivation
Model
Value Chain
Capabilities
Cross-Functional Capabilities
Capability Overlays
Roadmap & Planning
THE ADM ACROSS THE Z MODEL
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 48
UNDERSTANDING VALUE, PERFORMANCE AND
MOTIVATION
Capability-driven architectures are
designed to support the strategic
objectives of an organisation
Mission
Strategies
Tactics
Vision
Goals
Objectives OUTCOME
A statement describing the
aims, values and overall plan
of an organisation.
e.g. “To be the leading creator and
protector of wealth.”
The means by which a strategy is carried
out. Typically, projects are tactical
initiatives designed to execute strategy.
The long term plan of action designed to
achieve a
particular goal of set of
goals or objectives.
e.g. 5 year corporate plan.
A concise statement of a desired change.
e.g. “To be the leading provider of wealth
management services in our major target markets.”
Lower level statements that describe specific,
tangible products and deliverables that
projects
will deliver.
e.g. “To increase revenue by 15%. To reduce
OpEx by 10%.”
A high level statement of what the business
is trying to accomplish.
e.g. “Improve call centre response times”
CAPABILITY
People
Process
Technology
Information
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 49
UNDERSTANDING VALUE, PERFORMANCE AND
MOTIVATION
Mission
Strategies
Tactics
Vision
Goals
Objectives
OUTCOME
CAPABILITY
People
Process
Technology
Information
Business
Model
Value Chain
Capabilities
Performance
Model
Value Model
ENDMEANS
HOW
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 50
AN APPROACH TO REPRESENT MOTIVATION AND VALUE
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 51
VICTORIA INVESTMENT LOGIC MAPS
EXAMPLE: IMPROVING ACCESS TO HEALTH SERVICES IN RURAL VICTORIA
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 52
ALIGNING RISK WITH MOTIVATION
THE COSO ERM FRAMEWORK AND ITS ALIGNMENT WITH VALUE
Risk	management	without	a	
clear	mapping	to	value	and	
performance	results	in	flawed	
decision	making
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 53
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Problem Definition
Influencers
Values
Drivers
Value System Engineering
Business Scenario
Value Proposition
Business Model Canvas
Business Motivation
Model
Value Chain
Capabilities
Cross-Functional Capabilities
Capability Overlays
Roadmap & Planning
THE ADM ACROSS THE Z MODEL
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 54
NON-CORE CAPABILITY (MEET)
The goal is to meet market standards,
exploitation and reliability
Produce consistent, predictable outcomes
Focus on effectiveness and efficiency
CORE COMPETING CAPABILITY (COMPETE)
The goal is competitive parity
Focus on innovation and efficiency
CORE DIFFERENTIATING CAPABILITY (BEAT)
The goal is competitive advantage,
exploration & validity
Focus on innovation and efficiency
Produce outcomes that meet an objective
THREE LEVELS OF MIXING:
FROM THE BUSINESS MODEL TO
THE CAPABILITY RESOURCES
A reliable system will
produce the same test
results every time
A valid system will produce a result
that is shown, through the passage
of time, to be correct
COST
VALUE
5%
15%
80%
LEADING AND BEST PRACTICE RESEARCH, 2011/2012
THE ENVIRONMENT
BUSINESS MODEL
Revenue Model
Value Model
Product & Service Model
Performance Model
Cost Model
Operating model
Differentiating
Capability
Non-Core
Capability
Competing
Capability
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 55
MIXING AT THE BUSINESS MODEL LEVEL
THE ENVIRONMENT
BUSINESS MODEL
Markets
Industries
Customers
Market Segment
Channels
Customer Relationships
Value Proposition
Offering:
Services/Products
Processes/ Value Chains
Capabilities
Business Service
Functions
Data
Applications
Technology
MARKET
MODEL
OPERATING
MODEL
SERVICE
MODEL
THE ENVIRONMENT
BUSINESS MODEL
Revenue Model
Value Model
Product & Service
Model
Performance Model
Cost Model
Operating model
Differentiating
Capability
Non-Core
Capability
Competing
Capability
THE ENVIRONMENT
BUSINESS MODEL
•  ValueSystem
•  Value chain
•  Value Model
•  Capability Model
•  Structural
Ownership &
Accountability
•  Decomposed
Capability Model
•  Core competitive &
differentiating
capability
•  Service Model
Level 1
Level 3
Level 2
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 56
BUSINESS MODEL LEVEL 2
Capabilities Aligned to Functional Areas
THE ENVIRONMENT
BUSINESS MODEL
•  Value System
•  Value chain
•  Value Model
•  Capability Model
•  Structural Ownership
and Accountability
•  Decomposed
Capability Model
•  Core competitive &
differentiating
Capabilities
•  Service Model
Level 1
Level 3
Level 2
Competencies
Operations
Operations Management
Strategy & Execution Performance Management Underwriting & Risk Management
Document
Management
Decisional &
Business
Intelligence
Business
Process
Management
Process
Execution
Change
Management
Knowledge
Management
Resource
Allocation
Operational
Performance
Management
Technical
Operations
Training
Operations
Quality
Management
Strategy
Research
Strategy
Planning
Strategy
Management
Project
Portfolio
Selection
Project
Portfolio
Prioritisation
Project
Execution
Benefits
Realisation
Government
Policy
Enterprise
Architecture
Product/
Channels
Profitability
Management
Reporting Underwriting Reinsurance
Corporate
Risk
Management
Business
Continuity
Management
Internal Audit
Market Development and
Sourcing
Productising and Bundling Sales and Distribution Servicing
Product Service
New
Business
Underwriting
Policy Owner
Service
(POS)
Recurring
Claims
Management
Lump Sum
Claims
Management
Delivery
Method
Registration
Value Transaction
Management
Premium
Management
Payments
Management
Consolidated
Reporting
Customer Service
Enquiries
Complaints
Management
Retention
On-boarding
Adviser
Remuneratio
n
Business Development & Sales
Leads
Generation
Leads
Management
Broker
Management
Strategic
Pipeline
Tactical
Pipeline
Needs
Analysis
Product
Selection
Quotation &
Illustration
Application
Tenders
Client Development
Specialist
Training
Client
Servicing
Partner
Strategy &
Support
Client
Communicati
ons
Adviser
Relationship
Management
Sponsorship
Renewals
Consulting
Dealership
Relationship
Management
Product Manufacture & Maintenance
Product
Research
Product
Development
Product
Packaging
Product
Management
Reinsurance
Pricing
Marketing
Market &
Data
Analytics
Campaign
Management
Product
Launch
External
Market
Communicati
ons
Brand
Management
Promotions
Advertising
Internal
Sales Tools
Channel
Marketing
Claims
Mngmnt
Policy
Acquisition
Policy Admin
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 57
BUSINESS MODEL LEVEL 3:
THE CAPABILITY ANCHOR MODEL PROVIDES THE DETAILED UTILITY
BUILDING BLOCKS OF THE ORGANISATION
The Capability anchor model represents the
"map" of the organisation
THE ENVIRONMENT
BUSINESS MODEL
•  Value System
•  Value chain
•  Value Model
•  Capability Model
•  Structural Ownership
and Accountability
•  Decomposed
Capability Model
•  Core competitive &
differentiating
Capabilities
•  Service Model
Level 1
Level 3
Level 2
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 58
UNDERSTANDING CAPABILITY
Capability driven by business has different outcomes than that
driven by technology. Research shows that business driven
capability based planning is more successful.
However, without aligning to IT, business architecture
is more at risk of failing to deliver against strategic objectives.
CAPABILITY
OUTCOMES CUSTOMER
VALUE
PRODUCT
& SERVICE
PERFORMANCE PROCESS
PEOPLE
APPLICATIONS
DATA
INFORMATION
TECHNOLOGY
Information Technology
Business
Business		
Led	
IT		
Led
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 59
Current
State
Future State
Pain Points – Inefficiencies
The application submitted by the consultant is often incomplete.
The application is reviewed for completeness and adjudicated.
The conditional approval, along with a list or required documents are then sent back to the MS, who will communicate the results,
a conditional approval, back to the applicant.
This process can take several days and requires a significant time and effort from RBC resources.
What would a truly transformational scenario look like?
New Capabilities
1.  Portable credit scoring system and rules
engine
2.  Document verification at POS
3.  Automated disbursement
Required Changes - How are pain points addressed?
Credit scoring engine must be available to the mortgage specialist, permitting an on-the-spot adjudication
Document verification enabled at the point of sale by the cons.
Highly automated process which advances funds without the need for the human intervention
UNDERSTANDING THE THE DEGREE OF CHANGE EFFORT TO MOVE TO
THE FUTURE STATE
CHANGE FRAMEWORKS APPLIED TO YOUR PROCESS COMPONENTS CAN HELP DETERMINE IMPACT
Incremental
Improvement
Significant
Improvement
Changethe
Game
1
1
2
3
Contacts bank to
request mortgage
Cons. meets with
the applicant
Application is
complete
Application submitted for
adjudication
Application is
adjudicated
Results are
communicated to
MS
Applicant receives
cond’nal approval
Applicant submits
required docs
Documents
are verified
Client executes
documentation
Mortgage is
approved
Mortgage is set up on
bank systems
Funds are advanced
1
Contacts bank to
request mortgage
rep meets with
the applicant
Application is
complete
Application adjudicated on
the spot
Applicant receives
cond’nal approval
Applicant submits
required docs
Documents
are verified
Client executes
documentation
Mortgage is
approved
Mortgage is set up on
bank systems
Funds are advanced
1
Contacts bank to
request mortgage
Cons meets with
the applicant
Application is
complete
Application adjudicated and
docs verified
Client executes
documentation
Mortgage is
approved
Funds are advanced2 3
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 60
SEQUENCING PARADIGMS
DEFINITION KNOWLEDGE OF IMPLEMENTATION
CURRENT STATE Business as Usual •  Evaluation of current process
•  Evaluation of current benchmarks
•  Evaluation of current competitor practices and product/
service offerings
•  Identifying pain points and customer
irritants
•  Documenting current state
o  People
o  Process
o  Technology
FUTURE STATE Incremental improvement.
How do we improve a little?
•  Matching current competitor product/service offering
•  Median performance against peers
•  Process improvements
o  Lean Six Sigma
•  System changes
•  Outside vendors/outsourcing
Significant improvements
How do we improve a lot?
•  Market leading product/service offering
•  Top quartile performance relative to peers
•  Industry best practices
•  E2E changes involving the entire value
chain
•  New systems
•  Peer best practices
Truly transformational.
How do we change the game?
•  Market leading product/service offering – “blue water” –
strong source of lasting competitive advantage
•  Top decile performance relative to peers
•  World-class best practices (using non-financial industry
practices)
•  Outside specialty consulting companies
•  Best practices outside the financial
services industry
Determine the degree of change required to bridge the current and future state maturity
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 61
THE CROSS FUNCTIONAL CAPABILITY ANCHOR MODEL HELPS
IDENTIFY A BETTER MIX OF CAPABILITIES FOR BUSINESS OUTCOMES
It is at this point that the business begins to see the true value of using capabilities
Standard functional capabilities can be
aligned to a value chain
Cross functional capabilities assemble and mix functional capabilities to achieve
outcomes in the value map or driver tree
Cross functional capabilities each drive out different
outcomes. Underlying functional capabilities will have
varying perspectives of capability maturity and
capability uplift
You can also use cross functional models as scenarios to test the
capability anchor model validity
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 62
PROCESS
Sign	Up	&	Integrate
CAPABILITY
20. Information Services Management
CAPABILITY
15. Sales Execution
PROCESS
A1.	Explore	and	compare	
potential	providers	and	
services
PROCESS
B2.	Sign	up	and	activate	
account
PROCESS
C3.	Integrate	my	store	
with	Australia	Post’s	API’s
precedes precedes precedes precedes
BUSINESS SERVICE
Customer Sales
Management
BUSINESS SERVICE
Partner Collaboration
PROCESS
C1.	Receive	information	on	
how	the	systems	and	
processes	will	work
PROCESS
C2.	Install	the	necessary	
hardware	/	software	on	
my	systems
is realized by
LOGICAL
APPLICATION COMP.
Customer Sales
Management
LOGICAL
APPLICATION COMP.
Enterprise Resource
Planning
LOGICAL
APPLICATION COMP.
Partner Collaboration
Management
LOGICAL
APPLICATION COMP.
Security Management
communicates with communicates with
communicates with
implements
is realized by
implements
ACTOR
Post Staff
DATA ENTITY
Sales Order
ACTOR
Post Staff
participates in participates in
is processed by
consumes
SAP - CRM SAP - ERP auspost.com.a
u
IAM - OIM
is processed by
ACTOR
Fiona
participates in
THE CROSS FUNCTIONAL CAPABILITY MODEL
The process layer plays a strong role in assembling capabilities for different outcomes
CAPABILITY
People
Process
Tools
ConnecQng	these	to	projects	provides	valuable	insight	
into	coherency	of	the	capex	investment	across	the	
enterprise	
Within	each	process	flow,	there	are	typically	
four	to	five	capabiliQes	that	make	up	the	
process.	These	typically	correspond	to	
funcQonal	silos	that	complete	each	step.	
Within	each	capability,	the	model	idenQfies	
systems	or	applicaQons	that	are	used	to	
execute	the	capability.	This	is	where	the	model	
forms	the	alignment	between	business	and	IT.		
Archimate	
NotaQon
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 63
Products and Services
Valuable to the Customer
PRODUCT N
PRODUCT I
PRODUCT TPRODUCT Y
PRODUCT K
SERVICE DSERVICE N
SERVICE H SERVICE P
PRODUCT B SERVICE N
SERVICE T
PRODUCT S
SERVICE A
PRODUCT X
PRODUCT H
SERVICE O
PRODUCT N
PRODUCT ESERVICE C
SERVICE Q
SERVICE N
SERVICE T
SERVICE B
Customer Outcome
CUSTOMER INTERACTION MAP, CUSTOMER SEGMENT ABC
Establishing my account is
quick and simple…
Integration is quick and easy,
with the right help available
Efficient, with choices that
make it convenient
I know when the shipment
will arrive
I can find out whether my
shipments were delivered;
I get a meaningful resolution
to my problem
“I want to set-up my account”
“I want to get ready to send my
products”
“I want to send a shipment”
“I need to know when my
shipment will arrive”
“I want confirmation that my
shipments have arrived”
“Something has gone wrong
with my delivery…”
% of accounts set-up in
<X hours
% of accounts that utilise
more than X
% of orders with no
manual intervention
% of articles with at least
4 scans
Service Delivery
Performance Metric
# of complaints per million
products
RESEARCH EVALUATE PURCHASE USE INTEGRATE SERVE
Value to the Business
CUSTOMER BEHAVIOUR: UNDERSTAND TOUCHPOINTS ACROSS THE
LIFECYCLE AND IDENTIFY THE JOURNEYS AND PAINPOINTS
Map the Customer personas into a customer interaction map to
come up with the journey through the customer value chain & look
for issues
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 64
K
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 65
“ARCHITECTURE THINKING”
MOTIVATION MODEL BUSINESS MODEL
SERVICE MODEL
CAPABILITY MODEL
People
ROADMAP
GOVERNANCE
* Closed feedback
loop to Motivation
Model
Vision
Strategy
Blueprinting
Roadmapping
Governance
Information
Technology
Process
Design Thinking: Empathise, Define, Ideate, Prototype, Test
MARKET MODEL
MEANS ASSESSMENT
INFLUENCERS
ASSESSMENT
MEANS ENDS
MACRO
ENVIRONMENT
INDUSTRY
SCAN
SWOT PERFORMANCE
•  Financial
•  Customer
•  Internal (current)
•  Internal (long-term)
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 66
MOTIVATION MODEL
BUSINESS
CAPABILITIES
IM ROADMAP
GOVERNANCE
* Closed feedback
loop to Motivation
Model
Information
Process
MEANS ASSESSMENT
INFLUENCERS
ASSESSMENT
MEANS ENDS
MACRO
ENVIRONMENT
INDUSTRY
SCAN
SWOT PERFORMANCE
•  Financial
•  Customer
•  Internal (current)
•  Internal (long-term)
SOCIALISE WITH BUSINESS, LINK EIM EFFECTIVENESS TO BUSINESS GOALS AND RISK,
OBTAIN CONSENSUS, MEASURE & MONITOR
LINKING INFORMATION CAPABILITY ROADMAP TO BUSINESS
CAPABILITY, RISK AND MOTIVATION
Understand business motivation with
respect to information management
Identify the critical business capabilities
to support the strategies
Define roadmap – prioritised to support
timely delivery of EIM capability linked
to business need
1 2 3Understand changing needs for a
digital business
Identify the information risk appetite
and risks
Assess how application strategies
are impacted by low EIM capability
maturity
Identify the EIM capabilities materially
impacting business capability and
information risk – pertinent to the
business motivation
4
6 7 8 9 Measure and monitor performance
5 Assess how business capability
effectiveness is materially impacted by
low EIM capability maturity
1
2
3
4 6
8
7
Information Risk
Digital Requirements
9
APPLICATIONS
5
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 67
MOTIVATION MODEL
CLOUD SERVICE
OFFERINGS
CAPABILITY MODEL
ROADMAP
GOVERNANCE
* Closed feedback
loop to Motivation
Model
Information
Technology
Process
MEANS ASSESSMENT
INFLUENCERS
ASSESSMENT
MEANS ENDS
MACRO
ENVIRONMENT
INDUSTRY
SCAN
SWOT PERFORMANCE
•  Financial
•  Customer
•  Internal (current)
•  Internal (long-term)
SOCIALISE, OBTAIN CONSENSUS, MEASURE & MONITOR
CLOUD STRATEGY & ROADMAPPING JOURNEY
Understand the motivation for Cloud Understand the risk appetite of the business
and the risk profile of the offering
Obtain consensus, support and
commitment
1 2 3Understand business requirements for
Cloud
Identify and classify assets going into the
Cloud
Assess the Cloud service offerings Define the roadmap
4
5 6 7 8 Measure and monitor performance
1
2
3
4
5
6
7
Information & Risk
CLOUD
REQUIREMENTS
8
APPLICATIONS
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 68
ROLES &
OP. MODEL
HUMAN CENTRED SERVICE AND CAPABILITY
DEVELOPMENT
CAPABILITY
MODEL
ROADMAP
GOVERNANCE
* Closed feedback
loop to Motivation
Model
MEANS ASSESSMENT
MOTIVATION
MODEL
INFLUENCERS
ASSESSMENT
MEANS ENDS
SERVICE MODEL /
CATALOGUE
WHAT
WHY
COMMUNICATION
ENGAGEMENT
MODEL
DEMAND
ANALYSIS SOURCING
BUSINESS CONTEXT
HOW
WHO
WHERE
WHEN
CAPABILITY
ASSESSMENT
BUSINESS MODEL
CUSTOMER PERSONAS
VALUE PROP
EMPATHY MAPS
CURRENT FUTURE
SERVICE DESIGN PROCESS
ENABLES
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 69
THE BUSINESS OF ARCHITECTURE
ROADMAP
ROLES &
OP. MODEL
GOVERNANCE
* Closed feedback loop to
Motivation Model
MEANS ASSESSMENT
SERVICE MODEL
/ CATALOGUE COMMUNICATION
ENGAGEMENT
MODEL
DEMAND
ANALYSIS SOURCING
CAPABILITY
ASSESSMENT
MOTIVATION
MODEL
INFLUENCERS
ASSESSMENT
MEANS ENDS
BUSINESS MODEL
CAPABILITY
MODEL
BUSINESS CONTEXT
Where
When
Who
How
Why
What
Enables
MANDATE
SERVICE CO-DESIGN
CURRENT FUTURE
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 70
CAPABILITY MODEL OVERLAYS
Capability models and their overlays can reveal the answers
to important business questions
BUSINESS CAPABILITY MODEL
WITH STRATEGIC OVERLAY
BUSINESS CAPABILITY MODEL
WITH CURRENT MATURITY
OVERLAY
BUSINESS CAPABILITY MODEL
WITH PAIN POINTS
BUSINESS CAPABILITY MODEL
WITH INFLIGHT PROJECTS
What is important to my business? What are my strengths and
weaknesses?
Where is my current investment
focussed – CAPEX?
Where are my tactical and political
pressures?
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 71
BUSINESS CAPABILITY MODEL
WITH STRATEGIC OVERLAY
BUSINESS CAPABILITY MODEL
WITH CURRENT MATURITY
OVERLAY
BUSINESS CAPABILITY MODEL
WITH PAIN POINTS
BUSINESS CAPABILITY MODEL
WITH INFLIGHT PROJECTS
Am I over or underspending?
Is my current investment portfolio
dealing with tactical issues?
Is my strategy aligned with management
issues / focus areas?
Am I able to achieve my strategy?
Capability models and overlays can reveal the answers to
important business questions.
CAPABILITY MODEL OVERLAYS
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 72
LOOKING FOR OPPORTUNITIES AND SWEETSPOTS
72
Capabilities with
Strategic priorities
associated
CapabiliQes	with	Pain-points		
associated	
Sweetspots with no projects
Painpoints with no project
High priority with no projects
High priority with projects
Painpoints with projects
B	
C	
D	
E	
F	
A	 G	
Sweetspot and low hanging fruit
In-Flight		
Projects	
Investment with no identified digital
value
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 73
APPLY THE HEURISTICS TO EACH QUADRANT
Different decisions occur in each quadrant. Positioning the degree of change (complexity) against value will allow us to apply these
heuristics
Software
Automation
Projects
Funds
investment
Widget
assembly
Credit card
approval
Inventory
Management
Outsourcing
Projects
Major re-
design projects
New Product
design
Deals with other
companies
International
Delivery
On-line
purchasing
ERP based
process
improvement
Complex Processes, not
part of company’s core
competency: Outsource
Complex, dynamic
processes of high value:
undertake business
process improvement
efforts that focus on
people
Straightforward, static
commodity processes:
use automated ERP-
Type applications and / or
outsource
Straightforward, static,
and valuable: automate
to gain efficiency
HIGH
HIGH
LOW
LOW
Must be done but adds little value to
product or services
Very important to success, high value
added to products and services
STRATEGIC IMPORTANCE
COMPLEXITYANDDYNAMICS
Complex negotiation, design, or
decision process
Many business rules; expertise
involved
Some business rules
Procedure or simple algorithm
Organisation
Heuristics
*Adapted from “Business Process Change”
by Paul Harmon
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 74
LOOK FOR ALIGNMENT BETWEEN CAPABILITIES, PROJECT
EFFORT AND VALUE
Removed
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 75
BUSINESS ARCHITECTURE AND APPLICATION
PORTFOLIO MANAGEMENT
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 76
UNDERSTANDING CAPABILITIES AND THEIR RELATIONSHIPS HELPS
IMPROVE COHERENCY ACROSS THE ENTERPRISE
Clearer visibility of synergies is required to consolidate
strategic efforts across the major programs
Removed
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 77
UNDERSTANDING MATURITY HELPS IDENTIFY
STRENGTHS AND WEAKNESS
PROCESS: Maturity Overlay: CMMI
Removed
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 78
UNDERSTANDING THE RESOURCE MIX INSIDE A
CAPABILITY HELPS FOCUS ON THE RIGHT LEVERS
PROCESS and APPLICATION: Issue and Hotspot Analysis
Removed
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 79
OVERLAYING TECHNOLOGY AND INFORMATION HELPS IDENTIFY SYNERGIES
BETWEEN THE PEOPLE, PROCESSES AND THE UNDERLYING TECHNOLOGY
APPLICATION: Functional Alignment to SAP Platform
Removed
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 80
K
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 81
K
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 82
K
WHEN
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 83
CAPABILITIES AND CROSS FUNCTIONAL CAPABILITIES ARE
EVALUATED IN LIGHT OF ALL THE CHANGE FACTORS
The capability mixes are
evaluated against each
scenario to determine
the optimal path going
forward
REQUIREMENTS: PROGRAM “X” REQUIRES A $100M 5-YEAR NET BENEFIT AND MUST BE IMPLEMENTED IN UNDER 3 YEARS.
Business	Models	
Value	Streams
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 84
SEQUENCING PARADIGMS
Mixing strategic value and complexity
Strategic		Value	
Complexity	
100	
	
90	
	
80	
	
70	
	
60	
	
50	
	
40	
	
30	
	
20	
	
10	
	
0	
0														10														20														30														40														50														60														70														80												90													100	
31	
8	
32	
13	
16	
12	
17	
11	
3	
27	
25	
22	
26	
29	
21	 18	
24	
28	
16	
7	
4	
20	
30	
23	
34	
33	
39	
1	
40	
9	
37	
35	
10	
5	
2	
14	6	
38	
19	
What	sequence	should	
be	followed?
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 85
TRANSITION PLANNING
Look to mature capabilities through increments
Capabilities Basic Intermediate Advanced
Customer service
1. Service team trained and equipped
Marketing execution
2. Marketing playbooks automated
3. Marketing and sales campaign pilot
5. Advertising revenue adjustment calculation
7. Marketing and sales campaign pilot
6. Customer sat score & stakeholder sat score
Sales execution
1 2 3 4 5
Current State Future State
2. Sales playbooks automated
4. Marketing and sales campaign prototype
5. Sales team training
7. Cross functional process automation
6. Pilot
Maturity	
Capabilities increase and
decrease in maturity over
time depending upon
outcomes.
Plan for increments that can
be absorbed by the
business.
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 86
K
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 87
TELLING THE STORY
•  Introduces current state for
applications, integration, data
and technologies
•  Future State with workshop
inputs - demonstrates how the
future state was derived
•  EA Operating Model and
next steps
•  Introduce Project context
•  Organisation motivations
•  Organisation capabilities
•  Illustrates the use of the overlay
models
•  Highlights potential gaps
Business Anchor Model
A2
Business Motivation Model
A2
Business Anchor Model
Constraints Overlay
A2
Business Anchor Model
Investment Overlay
A2
Applications Portfolio
Current State
A2
Technologies Portfolio
Current State
A2
Conceptual Data Model
Security Overlay
A2
Applications Interaction Model
Current State
A
2
Applications Interaction Model
Future State
A2
Technologies Roadmap
A2
Applications Roadmap
A2
Project on a page
A3
Business Architecture
Findings
A3
Business Architecture
Findings
A3
Applications Architecture
Findings
A3
Applications Options
Workshop Integration
A3
Technology Options
Workshop Slide
A3 EA Operating
Model
A3
Recommendations
A3
Recommendations
A3A3
Business Architecture
Findings
1 2 543
1
2
5
4
3
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 88
SOCIALISE FOR BUY-IN
These methods help the architecture speak for itself
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 89
ABOUT
zero	 HOURS A DAY
BACK OFFICE
VENDOR ALIGNMENT
MORE THAN 1600 PEOPLE
TRAINED IN ARCHITECTURE
PRACTICES (AND RISING)
12YEARS IN BUSINESS	
8GLOBAL OFFICES
1600	
MORE THAN 10,000 DAYS OF
ARCHITECTURE SERVICES
DELIVERED LAST YEAR
10,000	
one 	COMMON METHOD
20
four	
six	OPERATING IN
6 CONTINENTS
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 90
OUR SERVICES
Servicing the Strategy and
Architecture needs of
Global Organisations
STRATEGY CONSULTING
›  Business Architecture
›  Strategic Services & Operating Model
Design:
»  Business Services & Capabilities
»  IT Services & Capabilities
›  Segment Strategies and Roadmaps:
»  Customer Experience & Digital
»  Enterprise Information Management
»  Big Data Analytics
»  Applications
»  Cloud & Infrastructure
»  Security, Risk & Resilience
»  Innovation Management
PRACTICE DEVELOPMENT
›  Architecture Service Model Design
›  Architecture Operating Model Design
›  Service and Capability Readiness
Assessment
›  Professional Training and Certification
(Business Architecture, Information
Management, TOGAF®, CDMP®, ArchiMate®
and Design Thinking)
›  Project Architecture Resources
›  Architecture Talent Strategy and
Professional Development
›  Architecture Back Office Services
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 91
Source: Building Bridges to the Promised
Land, The CMO Club, 2014
THE CMO AND CDO DILEMMA
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 92
WHAT WE HAVE FOUND IN LARGE ACCOUNTS
An ownership gap for business architecture exists -
Lines of responsibility around coherency and
business architecture, are often unclear
Cohesion Mandate
Undefined - Enterprise
Planning Ownership
EnterprisePerformance
Capabilities
X-Functional
Capabilities
Functional
Capabilities
CONTEXT
Markets
Industries
Customers
Market Segment
Channels
Customer Relationships
Value Proposition
Offering:
Services/Products
Processes/ Value Chains
Capabilities
Business Service
Functions
Data
Applications
Technology
MARKET
MODEL
OPERATING
MODEL
SERVICE
MODEL
Strategic
Architecture
Mandate –
Business
Ownership
IT Architecture
Mandate –
IT Ownership
Business
Architecture
Mandate
Undefined
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 93
ABSTRACT
CONCRETE
PROBLEM SOLUTION
Problem Definition
Influencers
Values
Drivers
Value System Engineering
Business Scenario
Value Proposition
Business Model Canvas
Business Motivation
Model
Value Chain
Capabilities
Cross-Functional Capabilities
Capability Overlays
Roadmap & Planning
THE ADM ACROSS THE Z MODEL
B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 94
QUESTIONS?

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Design of Business in an Age of Disruption

  • 1. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 1 BUSINESS BY DESIGN OCTOBER 2015 Craig Martin
  • 2. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 2 DISCIPLINE CONFUSION CONFUSION REIGNS AROUND WHICH DISCIPLINES ARE USED FOR WHAT SITUATIONS STRATEGIC PLAN MARKETING PLAN OPERATIONAL PLAN DELIVERY & EXECUTION OPERATIONS Planning Delivering Operating PORTFOLIO, PROGRAM AND PROJECT MANAGEMENTBUSINESS ARCHITECTURE ENTERPRISE ARCHITECTUREPRODUCT & SERVICE DESIGN BUSINESS PLANNING SOLUTIONS ARCHITECTURE SOLUTIONS DEVELOPMENT ENTERPRISE DESIGN BUSINESS ANALYSIS Environment analysis / SWOT, competitor / Business motivation / Product and portfolio analysis / Strategic Options Market analysis and forecasting Model the business / Evaluate and select strategy / Risk and funding analysis Project, portfolio and program management, solutions delivery Daily operations, run the business
  • 3. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 3 SOLVING PROBLEMS ABSTRACT CONCRETE Insight: “I want a beautiful environment” Opportunity: Paint the wall, Move, Buy new furniture, Hand a picture Problem Statement: “I need a hole” Solution Statement: “I need a drill” PROBLEM SOLUTION
  • 4. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 4 THE EMERGENCE OF ENTERPRISE DESIGN ABSTRACT CONCRETE PROBLEM SOLUTION Understanding the problem from a human centred perspective Prototyping and testing for disruptive options Understanding drivers, pressures, environment and working out motivation Developing operating models and solutions DESIGN THINKING ARCHITECTURE THINKING ENTERPRISEDESIGN
  • 5. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 5 ABSTRACT CONCRETE PROBLEM SOLUTION Understanding the problem from a human centred perspective Prototyping and testing for disruptive options Understanding drivers, pressures, environment and working out motivation Developing operating models and solutions NAVIGATING THE QUADRANTS APPROACHES TO CHANGE SOLUTION FOCUSSED TRANSFORMATION FOCUSSED DISRUPTION FOCUSSED DELIVERY FOCUSSED
  • 6. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 6 DESIGN MINDSET UNCERTAINTY / PATTERS / INSIGHTS CLARITY / FOCUS RESEARCH CONCEPT DESIGNPROTOTYPE DISCOVER DEFINE DEVELOP DELIVER
  • 7. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 7 ABSTRACT CONCRETE PROBLEM SOLUTION NAVIGATING THE QUADRANTS APPROACHES TO CHANGE DISCOVER DEFINE DEVELOP DELIVER
  • 8. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 8 … a discipline that uses designer’s sensibility and methods to match people’s needs with what is technologically feasible and what a viable business strategy can convert into customer value … Tim Brown, CEO, IDEO DESIGN THINKING DEFINITION ›  Quoted from ‘The Design of Business’, Roger Martin
  • 9. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 9 THREE LENSES OF HUMAN CENTRED DESIGN Start Here
  • 10. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 10 DECISIONS ABOUT ‘PROBLEMS’ ‘A Leader’s Framework for Decision Making’ David Snowden & Mary Boone Unknowable: The relationship between cause and effect is impossible to determine as they constantly shift. In chaos, it is necessary to act first and then sense through the result of action how to further respond. Understanding the problem comes later. This is the domain of rapid response. Example: Natural disasters Unknown Problems: The problem is in constant flux as a change to the situation causes ripple effects and unpredictability in other aspects. Information is often incomplete. Rather than implementing a solution, devising a concept, testing, iterating and then responding is needed. Problems often become complex when human behaviour is a significant factor. This is the domain of emergence. Example: Schooling experiences, organisational change management, traffic management Known unknowns: A complicated problem can have multiple right solutions. Complicated problems are understood, analysed and then responded to. It often requires expertise to solve and is largely process driven. Solving a complicated problem often requires the right expertise along with the right tools. In this realm you may know you have a problem but may not be able to solve it alone. This is the domain of expertise. Example: Fixing a car, constructing an aeroplane. Known knowns A simple problem is one of cause and effect. The solution is rarely disputed. The problem can be categorised, understood and a response devised based on the information. This is the domain of best practice. Example: 1+1 = 2, solving a jigsaw puzzle.
  • 11. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 11 FOUR ORDERS OF DESIGN ›  Business Design, ›  Organisation Design ›  Service Design, UX Design, Instructional Design, ›  Process Design ›  Richard Buchanan, (1992) Wicked Problems in Design Thinking ›  Product Design, Engineering, Architecture ›  Graphic Design, Visual Design
  • 12. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 12 BUSINESS PREDILECTION ›  ‘The Design of Business’, Roger Martin
  • 13. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 13 TOOLS FOR BUSINESS DESIGN: A SELECTION ›  DISCOVER ›  Literature Review ›  Time Machine ›  Shadowing ›  Touchstone Tours ›  Service Safari ›  A Day in the Life ›  Diary Studies ›  The Five Whys ›  Journey Maps DEFINE Mapping Complex Situations Stakeholder Map Customer Persona Empathy Mapping Mind Mapping Scenarios Affinity Mapping How Might We DEVELOP Bodystorming Collaborative Ideation Co-creation Storyboards Image Boards Prototyping Heuristic Evaluation Critique Circle DELIVER Rapid Iterative Testing A/B Testing Usability Testing Ergonomic Analysis Value Opportunity Analysis Feedback Review
  • 14. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 14 ABSTRACT CONCRETE PROBLEM SOLUTION Problem Definition Influencers Values Drivers Value System Engineering Business Scenario Value Proposition Business Model Canvas Business Motivation Model Value Chain Capabilities Cross-Functional Capabilities Capability Overlays Roadmap & Planning MOVING THROUGH THE QUADRANTS DISCOVER DEFINE DEVELOP DELIVER
  • 15. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 15 THE VALUE CYCLE THE QUICKEST WAY TO GET ADOPTION FOR COMPLEX ORGANIZATIONS What is value? How is value created? How is value measured and reported on? How is value delivered?
  • 16. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 16 YOU CANNOT DEVELOP MOTIVATION OR HYPOTHESES WITHOUT FIRST UNDERSTANDING VALUE ALIGNING VALUE TO PERFORMANCE BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT BUSINESS UNIT Process Performance Indicators PRODUCT DEVELOPMENT RETAIL SALESRETAIL PLANNINGSOURCING Objectives Drive Key Performance Indicators (SMART) Financial Operational Data Quality Indicators Business Flows FLOW OF GOODS, FLOW OF MONEY, FLOW OF INFORMATION VALUE CHAINS / CROSS FUNCTIONAL CAPABILITY / VALUE STREAMS Critical Success Factors Strategic Business Goals Value Monitoring VALUEREPORTINGPERFORMANCEREPORTING Performance Monitoring
  • 17. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 17 UNDERSTANDING THE DIMENSIONS OF VALUE AND PERFORMANCE AND REALISING THESE THROUGH THE INFORMATION MANAGEMENT DISCIPLINE What value is created? How is value created? How is value measured? BUSINESS SERVICES & SPI’S BUSINESS PROCESSES & PPI’S OBJECTIVES & KPI’S BUSINESS GROUP CSF’S BUSINESS AREA STRATEGIC GOALS ENTERPRISE STRATEGIC GOALS Increase Turnover Customer Service: Increase Customer Satisfaction Customer Group: Improve Self Service Customer Group: Improve telephone support KPI: Customers may be diverted by a maximum of 3 times KPI: Customers shall wait no longer than 2 minutes PPI: Time from reception to customer handling SPI: Service Quality measured in customer satisfaction DQI: Data quality measured in customer to product alignment Accounting: Reduce administration costs Sales: Increase new customers into retail outlets Capture customer details and product category prior to handling VALUE REPORTING PERFORMANCE REPORTING CAPABILITY: PEOPLE, PROCESS, TOOLS, DATA STRATEGIC REPORTING & DECISION MAKING OPERATIONAL REPORTING & DECISION MAKING STRATEGIC / EXECUTIVE SCORECARDS OPERATIONAL COCKPITS TACTICAL REPORTING & DECISION MAKING MGMT. DASHBOARDS
  • 18. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 18 Increase price Increase volume Improve mix Improve process Reduce cost of inputs Improve warehouse utilisation Increase productivity Decrease staffing Optimise scheduling Optimise physical network Decrease staffing Use alternative distribution Lower Customer Service & Order Management Costs Lower I/S costs Lower Finance / Accounting costs Lower HR costs Improve capital planning/ investment process Reduce inventories Reduce A/R increase A/P •  Profit-driven marketing efforts: •  Target “best” customers •  Offer “best” product mix •  Improve pricing management •  Proactive production planning for inventory management •  Most profitable capacity allocation/ utilisation •  Reduced sales management layers •  Focus on high-profit accounts •  Improved inventory flow visibility •  Lower transportation costs •  Higher facilities utilisation •  Less “fire fighting” •  Better carrier evaluation/ management •  Higher quality Customer Service •  Improved Supply Chain visibility •  Improved order fill rates •  Significantly lower cost •  More consistent service •  Faster problem resolution •  Improved capital stewardship •  Increased capital productivity •  Reduced inventory investment •  Reduced receivables investment o  Automated PO requisitions o  Improved information for evaluating vendors o  Automation of some scheduling functions o  Single point of entry eliminates data re-entry and improves accuracy o  Faster data reconciliation o  Automated billing processes o  Automated payroll processes o  Moderately lower safety stock inventory o  Moderately improved A/R and A/P management Increase revenues Decrease costs Reduce selling costs Reduce distribution costs Reduce administrative costs Increase gross profit Decrease operating expenses Capital deployment Cost of capital Increase net operating profit after tax (NOPAT) (I/S) Improve capital allocation (B/S) Enterprise Value Map BUILDING VALUE MODELS USING DRIVER TREES VALUE LEVERS TRANSFORMATION BENEFIT (Outcome) AUTOMATION BENEFIT
  • 19. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 19 VALUE IS ACHIEVED THROUGH COHERENCY Companies with a High Level of Cohesion affect EBIT Directly 4% 8% 12% 16% 20% 24% 28% 32% 0 20 40 60 80 100 120 EBITMARGIN,2003-2007 CAPABILITIES COHERENCE SCORE COCA-COLA WRIGLEY PEPSICO KIMBERLY-CLARK SARA LEE CONAGRA MERCK UNILEVER H.J. HEINZ KRAFT GENERAL MILLS CLOROX CAMPBELL SOUP COMPANY P&G *Adapted From “The Coherence Premium” – Harvard Business Review, June 2010 A coherent organiza.on is one that is thought of and executed as a whole
  • 20. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 20 ABSTRACT CONCRETE PROBLEM SOLUTION Problem Definition Influencers Values Drivers Value System Engineering Business Scenario Value Proposition Business Model Canvas Business Motivation Model Value Chain Capabilities Cross-Functional Capabilities Capability Overlays Roadmap & Planning MOVING THROUGH THE QUADRANTS DISCOVER DEFINE DEVELOP DELIVER
  • 21. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 21 WHEN DOES DISRUPTION OCCUR? ›  First stage of disruption, an innovator makes a product that is much more affordable and simpler to use (for the user) than what currently exists. ›  The second stage of disruption is when additional technological change is added which makes it simpler and less expensive to build and maintain the products. ›  The new change eventually displaces the existing market and value network, resulting in a radical improvement in performance. Disruptive technologies take a while to change the market Christensen, Clayton M. (2010-09-06). Disrupting Class, Expanded Edition: How Disruptive Innovation Will Change the Way the World Learns PERFORMANCE TIME market Market for old technology Market for new technology New replaces old technology
  • 22. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 22 ‘Enterprise Lifecycle's 2014 © Enterprise Architects PTY LTD PERORMANCE TIME ENTERPRISE BRAND PLATFORM BUSINESS MODEL BUSINESS CAPABILITIES PRODUCT DISRUPTIVE FORCES REQUIRE US TO RE-INVENT AT A NUMBER OF LEVELS Organisations…and architects need to be able to provide the means to enable this change
  • 23. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 23 VALUE SYSTEM DESIGN
  • 24. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 24 THE KNOWLEDGE FUNNEL Non-core but complex - Outsource Innovation, chaos & unresolved mysteries HIGH HIGH LOW LOW Must be done but adds little value to product or services Very important to success, high value added to products and services STRATEGIC IMPORTANCE & VALUE COMPLEXITYANDDYNAMICS Complex negotiation, design, or decision process Many business rules; expertise involved Some business rules Procedure or simple algorithm Non -Core Competencies Core Differentiating Competencies Everyday, highly repeatable and automated Make repeatable and reliable to gain efficiency Core Competitive Competencies THE RESULTS OF DISRUPTION THE SPEED THROUGH THE KNOWLEDGE FUNNEL IS ALSO INCREASING Source: Adapted from “Business Process Change” by Paul Harmon GOAL: Reliably produce consistent, predictable outcomes GOAL: Validity- Produce outcomes that meet desired objectives
  • 25. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 25 RE-INVENTION NEEDS TO OCCUR ACROSS THE FULL BUSINESS MODEL. NEW MIXES NEED TO BE IDENTIFIED Leading and Best Practice Research, 2011/2012 Scope: 1765 CEO’s and 2936 business leaders representing all major countries and industries
  • 26. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 26 THE NATURE OF INNOVATION IMAGE TO BE MODIFIED TO INCREASE TEXT SIZE
  • 27. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 27 DIGITAL ECONOMY General Principles of the Digital Economy. These are the principles of Digital Strategy Enablement “RENEWABILITY” You can renew data, but not exhaust it. Once created it can be used over and over again. It is a renewable resource “UNIVERSALITY” Everyone can access the same data simultaneously, and use it for a completely different reason “MAGNETISM” Information grows in value as more people absorb it, which, in turn, creates a network effect, drawing more people who want to learn. Metcalfe's law “LACK OF FRICTION” The more smoothly information flows, the more valuable it is. “VULNERABILITY” Criminals can harm or misuse information. They can destroy it, ruin it or steal it (as in identity theft). In this one sense, data is like physical goods Larry Downes - Three laws direct the revolutionary changes wrought by computer technology.
  • 28. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 28 “THE LAW OF DISRUPTION” The dissemination of change is “uneven.” Various elements of society struggle to keep up with rapid technological change. Technology changes exponentially, but social, economic and legal systems change incrementally” and struggle to keep up. Larry Downes - Three laws direct the revolutionary changes wrought by computer technology.
  • 29. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 29 DISRUPTION ALTERS ENTIRE VALUE NETWORKS Example: Disruption will alter the entire value chain and place the student at the centre Faculty & Staff CONTENT CLASSES SOCIAL INTERAC TION LECTURE RS STUDENT S Students & Social Interaction CONTEN T CLASSES FACULTY STAFF FACILITATORS Teach at SCHOOL and do Homework at HOME Teach at HOME and do Homework at SCHOOL
  • 30. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 30 DIGITAL DISRUPTION IS REDUCING THE DELAY Action Reaction Immediate Feedback Delayed Feedback B R “Life is indeed speeding up, but mans ability to deal with it, is slowing down”
  • 31. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 31 THIS ACCELERATION IS PUTTING PRESSURE ON CURRENT BUSINESS MODELS Technology commoditising from below Business roles taking on more architecture accountabilities
  • 32. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 32 THE RESULTS OF DISRUPTION THE COMMODITY SPACE IS GROWING, MAKING THE DIFFERENTIATION SPACE MORE COMPETITIVE Non-core but complex - Outsource Innovation, chaos & unresolved mysteries HIGH HIGH LOW LOW Must be done but adds little value to product or services Very important to success, high value added to products and services STRATEGIC IMPORTANCE & VALUE COMPLEXITYANDDYNAMICS Complex negotiation, design, or decision process Many business rules; expertise involved Some business rules Procedure or simple algorithm Non -Core Competencies Core Differentiating Competencies Everyday, highly repeatable and automated Make repeatable and reliable to gain efficiency Core Competitive Competencies Non-core but complex - Outsource Innovation, chaos & unresolved mysteries HIGH HIGH LOW LOW Must be done but adds little value to product or services Very important to success, high value added to products and services STRATEGIC IMPORTANCE & VALUE COMPLEXITYANDDYNAMICS Complex negotiation, design, or decision process Many business rules; expertise involved Some business rules Procedure or simple algorithm Non -Core Competencies Core Differentiating Competencies Everyday, highly repeatable and automated Make repeatable and reliable to gain efficiency Core Competitive Competencies Opportunit y or Threat?
  • 33. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 33 DISRUPTION IS SHIFTING THE FOCUS TO CUSTOMER LIFETIME VALUE This shift is the essence of what drives the emergence of the chief digital officer (CDO). It also forces a stronger focus on the chief marketing officer (CMO) SELLER DRIVEN ENTERPRISE CUSTOMER CENTRIC ENTERPRISE CUSTOMER DRIVEN ENTERPRISE “Maximize product profitability” Push Selectively Target Pull (collaboration) DATA ANALYSIS SERVICE Interactive & Proactive UNDERSTANDING Segmented Individualized CUSTOMER OFFERS Intra-enterprise bundles Inter-enterprise bundles ORGANISATION Integrated Function Customer Outcome CHANNELS Segment Driven Integrated and Seamless “Maximize market share” “Maximize customer lifetime value” MARKETING Passive & Reactive Interactive & Reactive Insight as Art Factual insight Predictive insight Broad Product Driven Singular Functional Silo Digital Strategy Focus
  • 34. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 34 WHAT IS DIGITAL? Digital is a participatory layer of all media that allows users to self select their own experiences and affords marketers the ability to bridge media, gain feedback, iterate their messages, and collect relationships. BUD CADDELL Enterprise Architects, March 2011 Slide 34
  • 35. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 35 THE CMO AGENDA FOCUS ON THE HERE AND NOW… Exploration & Validity Produce outcomes that meet an objective THE CIO AGENDA FOCUS ON LEVERAGE, SYNERGY, LONG TERM USE OF ASSETS… Exploitation and Reliability Produce consistent, predictable outcomes
  • 36. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 36 THE CUSTOMER DRIVEN SHIFT Production Products Selling and Promotion Profit Through sales volume Target individual Customer Intention Outcome Marketing Profit through customer lifetime satisfaction The Selling Concept Product Driven The Value Concept Customer Driven The Marke>ng Concept Customer Centric Target Market Segment Segment Needs Integrated Marketing Profit through Increased Market Share The digital strategy focus
  • 37. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 37 CUSTOMER DRIVEN AND DIFFERENT VALUE CHAINS The Selling Concept - Product Driven The Value Concept - Customer Driven The Marketing Concept - Customer Centric Production Products Selling and Promotion Profit Through sales volume STARTING POINT FOCUS MEANS ENDS Target Market Segment Segment Needs Integrated Marketing Profit through Increased Market Share STARTING POINT FOCUS MEANS ENDS Target individual Customer Intention Outcome Marketing Profit through customer lifetime satisfaction STARTING POINT FOCUS MEANS ENDS The customer driven shift The digital strategy focus
  • 38. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 38 *Adapted from Geoffrey Moore’s: Dealing with Darwin Each industry moves along a life cycle, with different opportunities for competitive advantage at each stage THE STRATEGIC BUSINESS MODEL Its also great for start-ups at the early stage of the lifecycle Introduction Growth Maturity Decline TOTAL INDUSTRY REVENUE TIME DISRUPTOR ENTERS MARKET SHARE, REVENUE & COST BECOME KEY PRODUCT INNOVATION REDUCES PROCESS INNOVATION BEGINS PRODUCT LEADERSHIP CUSTOMER INTIMACY OPERATIONAL EXCELLENCE VALUE DISCIPLINE ORIENTATION THROUGH THE INDUSTRY LIFECYCLE
  • 39. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 39 BUSINESS MODEL EVALUATION BUSINESS MODEL OPTIONS ARE EVALUATED AGAINST VALUE DRIVERS OR BUSINESS MODEL MECHANICS TO DETERMINE SHORTLISTS
  • 40. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 40 ARCHITECTURE DELIVERY MODELS EVALUATION OF STRATEGIC BUSINESS OPTIONS The capability mixes are evaluated against each scenario to determine the optimal path going forward REQUIREMENTS: PROGRAM “X” REQUIRES A $100M 5-YEAR NET BENEFIT AND MUST BE IMPLEMENTED IN UNDER 3 YEARS. Business Models Value Streams
  • 41. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 41 UNDERSTANDING THE ENGINE TO PRODUCE THE BUSINESS FIT The operating model delivers the infrastructure required to deliver the products and services to the customer segments THE ENVIRONMENT BUSINESS MODEL Markets Industries Customers Market Segment Channels Customer Relationships Value Proposition Offering: Services/Products Processes/ Value Chains Capabilities Business Service Functions Data Applications Technology MARKET MODEL OPERATING MODEL PRODUCTS & SERVICES MODEL Aligning what is valuable to the customer and what is value to the business is referred to as the business fit. This means that the engine delivers both aspects and is the ideal mix an organization needs to engineer for.
  • 42. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 42
  • 43. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 43 USING THE VALUE PROPOSITION CANVAS TO DEVELOP THE SERVICE MODELS The Value (Proposition) Map describes the features of a specific value proposition in your business model in a more structured and detailed way. It breaks your value proposition down into products and services, pain relievers, and gain creators. The Customer (Segment) Profile describes a specific customer segment in your business model in a more structured and detailed way. It breaks the customer down into its jobs, pains, and gains. Gain Creators describe how your products and services create customer gains. Pain Relievers describe how your products and services alleviate customer pains. You achieve CUSTOMER Fit when your value map meets your customer profile — when your products and services produce pain relievers and gain creators that match one or more of the jobs, pains, and gains that are important to your customer. Gain describe the outcomes customers want to achieve or the concrete benefits they are seeking. Pains describe bad outcomes, risks, and obstacles related to customer jobs. This is a list of all the Products and Services a value proposition is built around. Customer Jobs describe what customers are trying to get done in their work and in their lives when dealing with a problem or challenge.
  • 44. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 44 CUSTOMER INTERACTION ACROSS THE SERVICE LANDSCAPE Products and Services Valuable to the Customer PRODUCT N PRODUCT I PRODUCT TPRODUCT Y PRODUCT K SERVICE DSERVICE N SERVICE H SERVICE P PRODUCT B SERVICE N SERVICE T PRODUCT S SERVICE A PRODUCT X PRODUCT H SERVICE O PRODUCT N PRODUCT ESERVICE C SERVICE Q SERVICE N SERVICE T SERVICE B Customer Outcome CUSTOMER INTERACTION MAP, CUSTOMER SEGMENT ABC Establishing my account is quick and simple… Integration is quick and easy, with the right help available Efficient, with choices that make it convenient I know when the shipment will arrive I can find out whether my shipments were delivered; I get a meaningful resolution to my problem “I want to set-up my account” “I want to get ready to send my products” “I want to send a shipment” “I need to know when my shipment will arrive” “I want confirmation that my shipments have arrived” “Something has gone wrong with my delivery…” % of accounts set-up in <X hours % of accounts that utilise more than X % of orders with no manual intervention % of articles with at least 4 scans Service Delivery Performance Metric # of complaints per million products RESEARCH EVALUATE PURCHASE USE INTEGRATE SERVE Value to the Business
  • 45. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 45 CUSTOMER INTERACTION ACROSS THE SERVICE LANDSCAPE
  • 46. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 46 Business Motivation Strategic Business Models Value Discipline Orientation Operating Business Models Capabilities and Resources IT’S THE STRATEGIC BUSINESS MODELS THAT CAN DETERMINE WHERE VALUE LIES O P C O P C O P C Pe Pr T Pe Pr T Pe Pr T LEVERS DRIVERS INFORMATION Mission Strategies Tactics Vision Goals Objectives DISRUPTION NORMALLY OCCURS WITHIN THE VALUE SYSTEM.
  • 47. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 47 ABSTRACT CONCRETE PROBLEM SOLUTION Problem Definition Influencers Values Drivers Value System Engineering Business Scenario Value Proposition Business Model Canvas Business Motivation Model Value Chain Capabilities Cross-Functional Capabilities Capability Overlays Roadmap & Planning THE ADM ACROSS THE Z MODEL
  • 48. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 48 UNDERSTANDING VALUE, PERFORMANCE AND MOTIVATION Capability-driven architectures are designed to support the strategic objectives of an organisation Mission Strategies Tactics Vision Goals Objectives OUTCOME A statement describing the aims, values and overall plan of an organisation. e.g. “To be the leading creator and protector of wealth.” The means by which a strategy is carried out. Typically, projects are tactical initiatives designed to execute strategy. The long term plan of action designed to achieve a particular goal of set of goals or objectives. e.g. 5 year corporate plan. A concise statement of a desired change. e.g. “To be the leading provider of wealth management services in our major target markets.” Lower level statements that describe specific, tangible products and deliverables that projects will deliver. e.g. “To increase revenue by 15%. To reduce OpEx by 10%.” A high level statement of what the business is trying to accomplish. e.g. “Improve call centre response times” CAPABILITY People Process Technology Information
  • 49. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 49 UNDERSTANDING VALUE, PERFORMANCE AND MOTIVATION Mission Strategies Tactics Vision Goals Objectives OUTCOME CAPABILITY People Process Technology Information Business Model Value Chain Capabilities Performance Model Value Model ENDMEANS HOW
  • 50. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 50 AN APPROACH TO REPRESENT MOTIVATION AND VALUE
  • 51. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 51 VICTORIA INVESTMENT LOGIC MAPS EXAMPLE: IMPROVING ACCESS TO HEALTH SERVICES IN RURAL VICTORIA
  • 52. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 52 ALIGNING RISK WITH MOTIVATION THE COSO ERM FRAMEWORK AND ITS ALIGNMENT WITH VALUE Risk management without a clear mapping to value and performance results in flawed decision making
  • 53. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 53 ABSTRACT CONCRETE PROBLEM SOLUTION Problem Definition Influencers Values Drivers Value System Engineering Business Scenario Value Proposition Business Model Canvas Business Motivation Model Value Chain Capabilities Cross-Functional Capabilities Capability Overlays Roadmap & Planning THE ADM ACROSS THE Z MODEL
  • 54. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 54 NON-CORE CAPABILITY (MEET) The goal is to meet market standards, exploitation and reliability Produce consistent, predictable outcomes Focus on effectiveness and efficiency CORE COMPETING CAPABILITY (COMPETE) The goal is competitive parity Focus on innovation and efficiency CORE DIFFERENTIATING CAPABILITY (BEAT) The goal is competitive advantage, exploration & validity Focus on innovation and efficiency Produce outcomes that meet an objective THREE LEVELS OF MIXING: FROM THE BUSINESS MODEL TO THE CAPABILITY RESOURCES A reliable system will produce the same test results every time A valid system will produce a result that is shown, through the passage of time, to be correct COST VALUE 5% 15% 80% LEADING AND BEST PRACTICE RESEARCH, 2011/2012 THE ENVIRONMENT BUSINESS MODEL Revenue Model Value Model Product & Service Model Performance Model Cost Model Operating model Differentiating Capability Non-Core Capability Competing Capability
  • 55. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 55 MIXING AT THE BUSINESS MODEL LEVEL THE ENVIRONMENT BUSINESS MODEL Markets Industries Customers Market Segment Channels Customer Relationships Value Proposition Offering: Services/Products Processes/ Value Chains Capabilities Business Service Functions Data Applications Technology MARKET MODEL OPERATING MODEL SERVICE MODEL THE ENVIRONMENT BUSINESS MODEL Revenue Model Value Model Product & Service Model Performance Model Cost Model Operating model Differentiating Capability Non-Core Capability Competing Capability THE ENVIRONMENT BUSINESS MODEL •  ValueSystem •  Value chain •  Value Model •  Capability Model •  Structural Ownership & Accountability •  Decomposed Capability Model •  Core competitive & differentiating capability •  Service Model Level 1 Level 3 Level 2
  • 56. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 56 BUSINESS MODEL LEVEL 2 Capabilities Aligned to Functional Areas THE ENVIRONMENT BUSINESS MODEL •  Value System •  Value chain •  Value Model •  Capability Model •  Structural Ownership and Accountability •  Decomposed Capability Model •  Core competitive & differentiating Capabilities •  Service Model Level 1 Level 3 Level 2 Competencies Operations Operations Management Strategy & Execution Performance Management Underwriting & Risk Management Document Management Decisional & Business Intelligence Business Process Management Process Execution Change Management Knowledge Management Resource Allocation Operational Performance Management Technical Operations Training Operations Quality Management Strategy Research Strategy Planning Strategy Management Project Portfolio Selection Project Portfolio Prioritisation Project Execution Benefits Realisation Government Policy Enterprise Architecture Product/ Channels Profitability Management Reporting Underwriting Reinsurance Corporate Risk Management Business Continuity Management Internal Audit Market Development and Sourcing Productising and Bundling Sales and Distribution Servicing Product Service New Business Underwriting Policy Owner Service (POS) Recurring Claims Management Lump Sum Claims Management Delivery Method Registration Value Transaction Management Premium Management Payments Management Consolidated Reporting Customer Service Enquiries Complaints Management Retention On-boarding Adviser Remuneratio n Business Development & Sales Leads Generation Leads Management Broker Management Strategic Pipeline Tactical Pipeline Needs Analysis Product Selection Quotation & Illustration Application Tenders Client Development Specialist Training Client Servicing Partner Strategy & Support Client Communicati ons Adviser Relationship Management Sponsorship Renewals Consulting Dealership Relationship Management Product Manufacture & Maintenance Product Research Product Development Product Packaging Product Management Reinsurance Pricing Marketing Market & Data Analytics Campaign Management Product Launch External Market Communicati ons Brand Management Promotions Advertising Internal Sales Tools Channel Marketing Claims Mngmnt Policy Acquisition Policy Admin
  • 57. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 57 BUSINESS MODEL LEVEL 3: THE CAPABILITY ANCHOR MODEL PROVIDES THE DETAILED UTILITY BUILDING BLOCKS OF THE ORGANISATION The Capability anchor model represents the "map" of the organisation THE ENVIRONMENT BUSINESS MODEL •  Value System •  Value chain •  Value Model •  Capability Model •  Structural Ownership and Accountability •  Decomposed Capability Model •  Core competitive & differentiating Capabilities •  Service Model Level 1 Level 3 Level 2
  • 58. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 58 UNDERSTANDING CAPABILITY Capability driven by business has different outcomes than that driven by technology. Research shows that business driven capability based planning is more successful. However, without aligning to IT, business architecture is more at risk of failing to deliver against strategic objectives. CAPABILITY OUTCOMES CUSTOMER VALUE PRODUCT & SERVICE PERFORMANCE PROCESS PEOPLE APPLICATIONS DATA INFORMATION TECHNOLOGY Information Technology Business Business Led IT Led
  • 59. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 59 Current State Future State Pain Points – Inefficiencies The application submitted by the consultant is often incomplete. The application is reviewed for completeness and adjudicated. The conditional approval, along with a list or required documents are then sent back to the MS, who will communicate the results, a conditional approval, back to the applicant. This process can take several days and requires a significant time and effort from RBC resources. What would a truly transformational scenario look like? New Capabilities 1.  Portable credit scoring system and rules engine 2.  Document verification at POS 3.  Automated disbursement Required Changes - How are pain points addressed? Credit scoring engine must be available to the mortgage specialist, permitting an on-the-spot adjudication Document verification enabled at the point of sale by the cons. Highly automated process which advances funds without the need for the human intervention UNDERSTANDING THE THE DEGREE OF CHANGE EFFORT TO MOVE TO THE FUTURE STATE CHANGE FRAMEWORKS APPLIED TO YOUR PROCESS COMPONENTS CAN HELP DETERMINE IMPACT Incremental Improvement Significant Improvement Changethe Game 1 1 2 3 Contacts bank to request mortgage Cons. meets with the applicant Application is complete Application submitted for adjudication Application is adjudicated Results are communicated to MS Applicant receives cond’nal approval Applicant submits required docs Documents are verified Client executes documentation Mortgage is approved Mortgage is set up on bank systems Funds are advanced 1 Contacts bank to request mortgage rep meets with the applicant Application is complete Application adjudicated on the spot Applicant receives cond’nal approval Applicant submits required docs Documents are verified Client executes documentation Mortgage is approved Mortgage is set up on bank systems Funds are advanced 1 Contacts bank to request mortgage Cons meets with the applicant Application is complete Application adjudicated and docs verified Client executes documentation Mortgage is approved Funds are advanced2 3
  • 60. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 60 SEQUENCING PARADIGMS DEFINITION KNOWLEDGE OF IMPLEMENTATION CURRENT STATE Business as Usual •  Evaluation of current process •  Evaluation of current benchmarks •  Evaluation of current competitor practices and product/ service offerings •  Identifying pain points and customer irritants •  Documenting current state o  People o  Process o  Technology FUTURE STATE Incremental improvement. How do we improve a little? •  Matching current competitor product/service offering •  Median performance against peers •  Process improvements o  Lean Six Sigma •  System changes •  Outside vendors/outsourcing Significant improvements How do we improve a lot? •  Market leading product/service offering •  Top quartile performance relative to peers •  Industry best practices •  E2E changes involving the entire value chain •  New systems •  Peer best practices Truly transformational. How do we change the game? •  Market leading product/service offering – “blue water” – strong source of lasting competitive advantage •  Top decile performance relative to peers •  World-class best practices (using non-financial industry practices) •  Outside specialty consulting companies •  Best practices outside the financial services industry Determine the degree of change required to bridge the current and future state maturity
  • 61. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 61 THE CROSS FUNCTIONAL CAPABILITY ANCHOR MODEL HELPS IDENTIFY A BETTER MIX OF CAPABILITIES FOR BUSINESS OUTCOMES It is at this point that the business begins to see the true value of using capabilities Standard functional capabilities can be aligned to a value chain Cross functional capabilities assemble and mix functional capabilities to achieve outcomes in the value map or driver tree Cross functional capabilities each drive out different outcomes. Underlying functional capabilities will have varying perspectives of capability maturity and capability uplift You can also use cross functional models as scenarios to test the capability anchor model validity
  • 62. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 62 PROCESS Sign Up & Integrate CAPABILITY 20. Information Services Management CAPABILITY 15. Sales Execution PROCESS A1. Explore and compare potential providers and services PROCESS B2. Sign up and activate account PROCESS C3. Integrate my store with Australia Post’s API’s precedes precedes precedes precedes BUSINESS SERVICE Customer Sales Management BUSINESS SERVICE Partner Collaboration PROCESS C1. Receive information on how the systems and processes will work PROCESS C2. Install the necessary hardware / software on my systems is realized by LOGICAL APPLICATION COMP. Customer Sales Management LOGICAL APPLICATION COMP. Enterprise Resource Planning LOGICAL APPLICATION COMP. Partner Collaboration Management LOGICAL APPLICATION COMP. Security Management communicates with communicates with communicates with implements is realized by implements ACTOR Post Staff DATA ENTITY Sales Order ACTOR Post Staff participates in participates in is processed by consumes SAP - CRM SAP - ERP auspost.com.a u IAM - OIM is processed by ACTOR Fiona participates in THE CROSS FUNCTIONAL CAPABILITY MODEL The process layer plays a strong role in assembling capabilities for different outcomes CAPABILITY People Process Tools ConnecQng these to projects provides valuable insight into coherency of the capex investment across the enterprise Within each process flow, there are typically four to five capabiliQes that make up the process. These typically correspond to funcQonal silos that complete each step. Within each capability, the model idenQfies systems or applicaQons that are used to execute the capability. This is where the model forms the alignment between business and IT. Archimate NotaQon
  • 63. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 63 Products and Services Valuable to the Customer PRODUCT N PRODUCT I PRODUCT TPRODUCT Y PRODUCT K SERVICE DSERVICE N SERVICE H SERVICE P PRODUCT B SERVICE N SERVICE T PRODUCT S SERVICE A PRODUCT X PRODUCT H SERVICE O PRODUCT N PRODUCT ESERVICE C SERVICE Q SERVICE N SERVICE T SERVICE B Customer Outcome CUSTOMER INTERACTION MAP, CUSTOMER SEGMENT ABC Establishing my account is quick and simple… Integration is quick and easy, with the right help available Efficient, with choices that make it convenient I know when the shipment will arrive I can find out whether my shipments were delivered; I get a meaningful resolution to my problem “I want to set-up my account” “I want to get ready to send my products” “I want to send a shipment” “I need to know when my shipment will arrive” “I want confirmation that my shipments have arrived” “Something has gone wrong with my delivery…” % of accounts set-up in <X hours % of accounts that utilise more than X % of orders with no manual intervention % of articles with at least 4 scans Service Delivery Performance Metric # of complaints per million products RESEARCH EVALUATE PURCHASE USE INTEGRATE SERVE Value to the Business CUSTOMER BEHAVIOUR: UNDERSTAND TOUCHPOINTS ACROSS THE LIFECYCLE AND IDENTIFY THE JOURNEYS AND PAINPOINTS Map the Customer personas into a customer interaction map to come up with the journey through the customer value chain & look for issues
  • 64. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 64 K
  • 65. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 65 “ARCHITECTURE THINKING” MOTIVATION MODEL BUSINESS MODEL SERVICE MODEL CAPABILITY MODEL People ROADMAP GOVERNANCE * Closed feedback loop to Motivation Model Vision Strategy Blueprinting Roadmapping Governance Information Technology Process Design Thinking: Empathise, Define, Ideate, Prototype, Test MARKET MODEL MEANS ASSESSMENT INFLUENCERS ASSESSMENT MEANS ENDS MACRO ENVIRONMENT INDUSTRY SCAN SWOT PERFORMANCE •  Financial •  Customer •  Internal (current) •  Internal (long-term)
  • 66. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 66 MOTIVATION MODEL BUSINESS CAPABILITIES IM ROADMAP GOVERNANCE * Closed feedback loop to Motivation Model Information Process MEANS ASSESSMENT INFLUENCERS ASSESSMENT MEANS ENDS MACRO ENVIRONMENT INDUSTRY SCAN SWOT PERFORMANCE •  Financial •  Customer •  Internal (current) •  Internal (long-term) SOCIALISE WITH BUSINESS, LINK EIM EFFECTIVENESS TO BUSINESS GOALS AND RISK, OBTAIN CONSENSUS, MEASURE & MONITOR LINKING INFORMATION CAPABILITY ROADMAP TO BUSINESS CAPABILITY, RISK AND MOTIVATION Understand business motivation with respect to information management Identify the critical business capabilities to support the strategies Define roadmap – prioritised to support timely delivery of EIM capability linked to business need 1 2 3Understand changing needs for a digital business Identify the information risk appetite and risks Assess how application strategies are impacted by low EIM capability maturity Identify the EIM capabilities materially impacting business capability and information risk – pertinent to the business motivation 4 6 7 8 9 Measure and monitor performance 5 Assess how business capability effectiveness is materially impacted by low EIM capability maturity 1 2 3 4 6 8 7 Information Risk Digital Requirements 9 APPLICATIONS 5
  • 67. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 67 MOTIVATION MODEL CLOUD SERVICE OFFERINGS CAPABILITY MODEL ROADMAP GOVERNANCE * Closed feedback loop to Motivation Model Information Technology Process MEANS ASSESSMENT INFLUENCERS ASSESSMENT MEANS ENDS MACRO ENVIRONMENT INDUSTRY SCAN SWOT PERFORMANCE •  Financial •  Customer •  Internal (current) •  Internal (long-term) SOCIALISE, OBTAIN CONSENSUS, MEASURE & MONITOR CLOUD STRATEGY & ROADMAPPING JOURNEY Understand the motivation for Cloud Understand the risk appetite of the business and the risk profile of the offering Obtain consensus, support and commitment 1 2 3Understand business requirements for Cloud Identify and classify assets going into the Cloud Assess the Cloud service offerings Define the roadmap 4 5 6 7 8 Measure and monitor performance 1 2 3 4 5 6 7 Information & Risk CLOUD REQUIREMENTS 8 APPLICATIONS
  • 68. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 68 ROLES & OP. MODEL HUMAN CENTRED SERVICE AND CAPABILITY DEVELOPMENT CAPABILITY MODEL ROADMAP GOVERNANCE * Closed feedback loop to Motivation Model MEANS ASSESSMENT MOTIVATION MODEL INFLUENCERS ASSESSMENT MEANS ENDS SERVICE MODEL / CATALOGUE WHAT WHY COMMUNICATION ENGAGEMENT MODEL DEMAND ANALYSIS SOURCING BUSINESS CONTEXT HOW WHO WHERE WHEN CAPABILITY ASSESSMENT BUSINESS MODEL CUSTOMER PERSONAS VALUE PROP EMPATHY MAPS CURRENT FUTURE SERVICE DESIGN PROCESS ENABLES
  • 69. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 69 THE BUSINESS OF ARCHITECTURE ROADMAP ROLES & OP. MODEL GOVERNANCE * Closed feedback loop to Motivation Model MEANS ASSESSMENT SERVICE MODEL / CATALOGUE COMMUNICATION ENGAGEMENT MODEL DEMAND ANALYSIS SOURCING CAPABILITY ASSESSMENT MOTIVATION MODEL INFLUENCERS ASSESSMENT MEANS ENDS BUSINESS MODEL CAPABILITY MODEL BUSINESS CONTEXT Where When Who How Why What Enables MANDATE SERVICE CO-DESIGN CURRENT FUTURE
  • 70. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 70 CAPABILITY MODEL OVERLAYS Capability models and their overlays can reveal the answers to important business questions BUSINESS CAPABILITY MODEL WITH STRATEGIC OVERLAY BUSINESS CAPABILITY MODEL WITH CURRENT MATURITY OVERLAY BUSINESS CAPABILITY MODEL WITH PAIN POINTS BUSINESS CAPABILITY MODEL WITH INFLIGHT PROJECTS What is important to my business? What are my strengths and weaknesses? Where is my current investment focussed – CAPEX? Where are my tactical and political pressures?
  • 71. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 71 BUSINESS CAPABILITY MODEL WITH STRATEGIC OVERLAY BUSINESS CAPABILITY MODEL WITH CURRENT MATURITY OVERLAY BUSINESS CAPABILITY MODEL WITH PAIN POINTS BUSINESS CAPABILITY MODEL WITH INFLIGHT PROJECTS Am I over or underspending? Is my current investment portfolio dealing with tactical issues? Is my strategy aligned with management issues / focus areas? Am I able to achieve my strategy? Capability models and overlays can reveal the answers to important business questions. CAPABILITY MODEL OVERLAYS
  • 72. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 72 LOOKING FOR OPPORTUNITIES AND SWEETSPOTS 72 Capabilities with Strategic priorities associated CapabiliQes with Pain-points associated Sweetspots with no projects Painpoints with no project High priority with no projects High priority with projects Painpoints with projects B C D E F A G Sweetspot and low hanging fruit In-Flight Projects Investment with no identified digital value
  • 73. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 73 APPLY THE HEURISTICS TO EACH QUADRANT Different decisions occur in each quadrant. Positioning the degree of change (complexity) against value will allow us to apply these heuristics Software Automation Projects Funds investment Widget assembly Credit card approval Inventory Management Outsourcing Projects Major re- design projects New Product design Deals with other companies International Delivery On-line purchasing ERP based process improvement Complex Processes, not part of company’s core competency: Outsource Complex, dynamic processes of high value: undertake business process improvement efforts that focus on people Straightforward, static commodity processes: use automated ERP- Type applications and / or outsource Straightforward, static, and valuable: automate to gain efficiency HIGH HIGH LOW LOW Must be done but adds little value to product or services Very important to success, high value added to products and services STRATEGIC IMPORTANCE COMPLEXITYANDDYNAMICS Complex negotiation, design, or decision process Many business rules; expertise involved Some business rules Procedure or simple algorithm Organisation Heuristics *Adapted from “Business Process Change” by Paul Harmon
  • 74. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 74 LOOK FOR ALIGNMENT BETWEEN CAPABILITIES, PROJECT EFFORT AND VALUE Removed
  • 75. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 75 BUSINESS ARCHITECTURE AND APPLICATION PORTFOLIO MANAGEMENT
  • 76. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 76 UNDERSTANDING CAPABILITIES AND THEIR RELATIONSHIPS HELPS IMPROVE COHERENCY ACROSS THE ENTERPRISE Clearer visibility of synergies is required to consolidate strategic efforts across the major programs Removed
  • 77. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 77 UNDERSTANDING MATURITY HELPS IDENTIFY STRENGTHS AND WEAKNESS PROCESS: Maturity Overlay: CMMI Removed
  • 78. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 78 UNDERSTANDING THE RESOURCE MIX INSIDE A CAPABILITY HELPS FOCUS ON THE RIGHT LEVERS PROCESS and APPLICATION: Issue and Hotspot Analysis Removed
  • 79. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 79 OVERLAYING TECHNOLOGY AND INFORMATION HELPS IDENTIFY SYNERGIES BETWEEN THE PEOPLE, PROCESSES AND THE UNDERLYING TECHNOLOGY APPLICATION: Functional Alignment to SAP Platform Removed
  • 80. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 80 K
  • 81. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 81 K
  • 82. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 82 K WHEN
  • 83. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 83 CAPABILITIES AND CROSS FUNCTIONAL CAPABILITIES ARE EVALUATED IN LIGHT OF ALL THE CHANGE FACTORS The capability mixes are evaluated against each scenario to determine the optimal path going forward REQUIREMENTS: PROGRAM “X” REQUIRES A $100M 5-YEAR NET BENEFIT AND MUST BE IMPLEMENTED IN UNDER 3 YEARS. Business Models Value Streams
  • 84. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 84 SEQUENCING PARADIGMS Mixing strategic value and complexity Strategic Value Complexity 100 90 80 70 60 50 40 30 20 10 0 0 10 20 30 40 50 60 70 80 90 100 31 8 32 13 16 12 17 11 3 27 25 22 26 29 21 18 24 28 16 7 4 20 30 23 34 33 39 1 40 9 37 35 10 5 2 14 6 38 19 What sequence should be followed?
  • 85. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 85 TRANSITION PLANNING Look to mature capabilities through increments Capabilities Basic Intermediate Advanced Customer service 1. Service team trained and equipped Marketing execution 2. Marketing playbooks automated 3. Marketing and sales campaign pilot 5. Advertising revenue adjustment calculation 7. Marketing and sales campaign pilot 6. Customer sat score & stakeholder sat score Sales execution 1 2 3 4 5 Current State Future State 2. Sales playbooks automated 4. Marketing and sales campaign prototype 5. Sales team training 7. Cross functional process automation 6. Pilot Maturity Capabilities increase and decrease in maturity over time depending upon outcomes. Plan for increments that can be absorbed by the business.
  • 86. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 86 K
  • 87. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 87 TELLING THE STORY •  Introduces current state for applications, integration, data and technologies •  Future State with workshop inputs - demonstrates how the future state was derived •  EA Operating Model and next steps •  Introduce Project context •  Organisation motivations •  Organisation capabilities •  Illustrates the use of the overlay models •  Highlights potential gaps Business Anchor Model A2 Business Motivation Model A2 Business Anchor Model Constraints Overlay A2 Business Anchor Model Investment Overlay A2 Applications Portfolio Current State A2 Technologies Portfolio Current State A2 Conceptual Data Model Security Overlay A2 Applications Interaction Model Current State A 2 Applications Interaction Model Future State A2 Technologies Roadmap A2 Applications Roadmap A2 Project on a page A3 Business Architecture Findings A3 Business Architecture Findings A3 Applications Architecture Findings A3 Applications Options Workshop Integration A3 Technology Options Workshop Slide A3 EA Operating Model A3 Recommendations A3 Recommendations A3A3 Business Architecture Findings 1 2 543 1 2 5 4 3
  • 88. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 88 SOCIALISE FOR BUY-IN These methods help the architecture speak for itself
  • 89. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 89 ABOUT zero HOURS A DAY BACK OFFICE VENDOR ALIGNMENT MORE THAN 1600 PEOPLE TRAINED IN ARCHITECTURE PRACTICES (AND RISING) 12YEARS IN BUSINESS 8GLOBAL OFFICES 1600 MORE THAN 10,000 DAYS OF ARCHITECTURE SERVICES DELIVERED LAST YEAR 10,000 one COMMON METHOD 20 four six OPERATING IN 6 CONTINENTS
  • 90. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 90 OUR SERVICES Servicing the Strategy and Architecture needs of Global Organisations STRATEGY CONSULTING ›  Business Architecture ›  Strategic Services & Operating Model Design: »  Business Services & Capabilities »  IT Services & Capabilities ›  Segment Strategies and Roadmaps: »  Customer Experience & Digital »  Enterprise Information Management »  Big Data Analytics »  Applications »  Cloud & Infrastructure »  Security, Risk & Resilience »  Innovation Management PRACTICE DEVELOPMENT ›  Architecture Service Model Design ›  Architecture Operating Model Design ›  Service and Capability Readiness Assessment ›  Professional Training and Certification (Business Architecture, Information Management, TOGAF®, CDMP®, ArchiMate® and Design Thinking) ›  Project Architecture Resources ›  Architecture Talent Strategy and Professional Development ›  Architecture Back Office Services
  • 91. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 91 Source: Building Bridges to the Promised Land, The CMO Club, 2014 THE CMO AND CDO DILEMMA
  • 92. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 92 WHAT WE HAVE FOUND IN LARGE ACCOUNTS An ownership gap for business architecture exists - Lines of responsibility around coherency and business architecture, are often unclear Cohesion Mandate Undefined - Enterprise Planning Ownership EnterprisePerformance Capabilities X-Functional Capabilities Functional Capabilities CONTEXT Markets Industries Customers Market Segment Channels Customer Relationships Value Proposition Offering: Services/Products Processes/ Value Chains Capabilities Business Service Functions Data Applications Technology MARKET MODEL OPERATING MODEL SERVICE MODEL Strategic Architecture Mandate – Business Ownership IT Architecture Mandate – IT Ownership Business Architecture Mandate Undefined
  • 93. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 93 ABSTRACT CONCRETE PROBLEM SOLUTION Problem Definition Influencers Values Drivers Value System Engineering Business Scenario Value Proposition Business Model Canvas Business Motivation Model Value Chain Capabilities Cross-Functional Capabilities Capability Overlays Roadmap & Planning THE ADM ACROSS THE Z MODEL
  • 94. B U S I N E S S D E S I G N B Y C R A I G M A R T I N - E N T E R P R I S E A R C H I T E C T S / F H O | PAGE 94 QUESTIONS?