The document summarizes key information about Costco Wholesale, including that it is a membership-based retailer with over $100 billion in annual sales across 618 warehouses globally. It also discusses Costco's ongoing technology modernization and business transformation efforts to move from legacy systems to more distributed, nimble architectures and enable business innovation. Some challenges mentioned are building EA competency, aligning existing projects, and selecting the right tools.

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Shrikant Palkar Vish Vishwanathan
Director and Managing Principal,
Enterprise Architect CC& C Solutions
Costco WholeSale
Open Group conference, Mumbai -Feb 2013

2. ! Membership based wholesale retailer
! About 28years in business
! Unique business model
Ø Pay before you shop
Ø Limited number of items
Ø Restricted mark-up for ALL items

3. ! Annual Sales of over $100Billion
! 618 warehouses in 8 countries
! $146Million average sales / warehouse
! 89M Sq.Ft.(1,45,000 Sqft /warehouse)
! ~174,000 employees worldwide
! >2M transactions / day
! 65M Members, 89% Renewal Rate

4. ! Costco has embarked on a multi-year Technology
Modernization and Business Transformation Effort
! IS Division as enabler of business is targeting
Ø Large monolithic information systems developed over
two decades à Loosely coupled, distributed, nimble
systems
Ø Technology from eighties à Browser based, mobile
enabled, future ready business and technology
architectures
Ø People with deep business knowledge, set in very
established ways of managing systems à Staff with
deep knowledge, re-skilled to new technology, modes
of thinking while preserving “culture”

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! Improve quality and time to deliver for
business solutions
! Improve business efficiency
! Enable globally integrated business
! Reduce risks from technology debt
! Enable business innovation
A modernization & transformation team was
created to spearhead the effort

6. “Changing the engine on a racing car
going 100 kmph on the highway “

7. SCOPE of EA ACTIVITIES

8. • City Planning – Strategy, Road maps
• Home Building – Projects, Business Delivery
• Construction – Hand holding, skill
development

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! People challenges :
o Building EA competency (core plus extended teams)
o Bringing everyone onto the same EA page
o Practical EA training, on the job mentoring and hand holding
o Communicating and collaborating with all other teams
o Locating the right external skills
! Process challenges :
o Understanding the priorities and KPIs for modernization initiatives
and linking to the EA strategy
o Retrofitting & positioning a few large enterprise-wide projects
already underway
o Aligning and linking existing business capability initiatives
currently undertaken into the new EA Framework
! Technology challenges :
o Selecting and implementing the right tool – not too complex and
still functionally adequate

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Structure -2
• Business
Early Days Architecture
• Modernization & Documentation
Transformation • EARB
Team • COEs
Structure -1 Formal
• Enterprise structure
Architecture • Global
Team infrastructure
(EA + Domain ) plan
• Strategies • TOGAF Adoption,
definition • Troux Tool
• Architecture • IDA
Decisions
• ALM & SDM

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! To capture all the baseline building blocks
SELLING across all the architecture layers
! To establish links between all the layers of
architecture and portfolio of programs
! To be the repository for all the artifacts and
deliverables
Ø Goals & strategies
Ø Principles, Rules & Guidelines
Ø Templates
Ø Standards
Ø Reference models
! To generate reports for architectural and
management visibility

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! A Website
Ø To navigate through the various ADM phases
Ø To provide details to execute/implement ADM
for Costco projects
! Coverage - ADM phases including
Ø Objectives
Ø Inputs
Ø Steps/Tasks
Ø Outputs (Mandatory & Optional)
Website Ø Techniques
Ø Templates for artifacts and deliverables

13. ! Business Capabilities Map
! Supply Chain Reference Model
! Reference Application Architecture
! Network Architecture

14. Frame
work • Industry standard
• Open
Profes- Toolset
sionals
• Certified • Certified
• OJT • Comprehensive

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Strategic, Tactical or Both?
Upstream Mid stream Downstream
• Hook directly into business
strategies
• Offer tools for prioritizing • Build effective EA teams • Provide strategic context
• Enhance competencies to current projects
modernization projects
• Provide a continuous • Enhance EA aligned
• Show quick wins mapping
learning platform project deliveries
into business capabilities
BUSINESS DRIVEN EA DRIVEN PROJECT DRIVEN

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Modernization Initiative
Current IT activities
relevant to EA
POS
+
SAP
+
Others
P
&
A
6 months
1st
Cycle
2nd
Cycle 3rd
Cycle
Learning,
Improving
customiza@on,
template,
crea@ng
checklists,
TROUX
principles,
best
concepts,
prac@ces,
Repository models,
adding
more
repository,
models/
tools
ar@facts
Founda@on
0 to 6 months 6 to 9 months 9 to 12 months 12 + months

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SCOPE:
SELLING •
Selling is defined as “Anywhere a good or service can be
purchased directly from Costco”
POS • The process begins when a member or customer finalizes his or
her purchase decision
• The process is complete when payment is finalized
• Refunds may be considered as part of the process, including the
determination of the refund amount and refunding the member
or customer, up to the decision as to whether the returned item
is re-saleable or not re-saleable.
Better
Reusability of Use of TROUX
understanding
Improvements information tool to
Customization and
in participation from the POS capture
based on based on improvements
POC project Building
available in the ,
lessons learnt resulting in Blocks and
from POS POC Building Blocks validation &
faster turn link them
creation of EA
project around
artefacts

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4+1 Views
Capabilities Processes
What we do How we do it
Drivers/Goals
Objectives
Facades Entities
Who we do it with The things involved

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Links to
4+1 Views system /
Links to application
technology building
capability
building Capabilities Processes blocks
blocks What we do How we do it
Drivers/Goals Links to
Links to Objectives logical
Integration data
building building
blocks
Facades Entities blocks
Who we do it with The things involved

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! IS Services that support Business Functions and
processes that are deemed critical and (or) having a
negative impact to business as a result of a serious
BCM service disruption(local disruption or a major
disaster)
! Critical business processes/functions and the inter
dependencies between them
! Organization's awareness of risks to critical business
functions due unavailability of IS services
! Identifying business functions that need to comply
with various federal and state regulations relating to
availability of information and taking appropriate
measures to satisfy such regulatory requirements

21. ! Business involvement is critical
! EA is not an ivory tower
! Bi-focal vision is essential – tactical as
well as strategic
! People are the most important
component

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