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INFORMATION TECHNOLOGY PRACTICE
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
Advances in
Business Architecture
Panelist: 	 Parin Kothari, Senior Manager, Business Architecture,
Moderator: 	Bart Kaplan, Senior Director, Enterprise Architecture Executive Council
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ROADMAP FOR THE PRESENTATION
Business Architecture
Polling Results
Introduction
to Panelist
QA and
Upcoming Events
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INTRODUCING PARIN KOTHARI
Parin Kothari is an experienced business consultant who started his professional career at Boston Consulting Group in South
Asia. Since then, he has worked in varied functional areas—finance, marketing, technology, and operations—and a plethora of
industries including banking and financial services, media and advertising, consumer products, industrial services, health care,
retail and auto manufacturing. Parin was instrumental in establishing the business architecture practice at Wells Fargo bank’s
Internet Services Group and worked on the merger with Wachovia. In his recent job, Parin is working to build the practice for
TD Bank Financial Group’s North American Internet Channel group. Parin complements his profit-driving business architecture
focus by working alongside grass root local NGOs in more than eight countries across four continents attempting to build a
sustainable social architecture. Parin holds his MBA from Syracuse University, New York.
TD Bank Financial Group
Industry: Financial The Toronto-Dominion Bank, together with its subsidiaries, provides retail
and commercial banking, wealth management, and wholesale banking
products and services in North America and internationally. The company
operates in four segments: Canadian Personal and Commercial Banking,
Wealth Management, United States Personal and Commercial Banking,
and Wholesale Banking.
2010
Operating
Revenues: US$24.91 Billion
Employees: 65,930
5
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ROADMAP FOR THE PRESENTATION
Business Architecture
Polling Results
Introduction
to Panelist
QA and
Upcoming Events
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Business architecture’s
importance has grown
substantially over the
past 12 months.
Discussion Questions:
■■ What is driving the
importance of business
architecture in your
organization?
■■ Where is the interest
coming from?
■■ How are you communicating
business architecture’s
importance?
BUSINESS ARCHITECTURE IMPORTANCE
How Has the Importance of Business Architecture in Your Organization Changed in the Past 12 Months?
1%
Much Less Important
3%
Somewhat 	
Less Important
11%
No Change
49%
Somewhat Important
35%
Much More Important
n = 97 EAEC member institutions.
Source:	EAEC Membership Survey, January 2011.
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Business Architecture
was created to facilitate
strategic alignment
and execution.
HOW TO STRENGTHEN THE CONNECTION
BETWEEN STRATEGY AND EXECUTION
CHALLENGES
Business Architecture incorporates the use of a target operating model, supported
by business capabilities, to better connect strategic vision to the underlying
changes to people, process, and technology needed to realize that strategy.
APPROACH
As its coverage has expanded to 15 lines of business, Business Architecture
has helped to extend planning horizons, rationalize project portfolios, lower
infrastructure costs, and reduce cycle times.
RESULTS
Strategy
Execution
There was a need for a better mechanism to provide
traceability of strategic intent and to better balance portfolio
spend on strategic and tactical initiatives.
Transformation
Initiatives
To increase spend on transformational change, a portfolio
approach to investments was needed.
Change
Management
In moving from a product-centric to a client-centric
organization, RBC needed to ensure all dimensions of
transformation were addressed (people, process, technology).
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Business simplification
efforts require an
integrated enterprise
process view.
BUSINESS SILOS AND PORTFOLIO COMPLEXITY
CHALLENGE
By stripping physical processes of their underlying systems and specific
organizational content, Dell creates an integrated, enterprise-wide 	
view of future state processes to drive simplification efforts.
Dell’s processes and applications are built out rapidly in support of the
company’s growth. This results, however, in complex and siloed business areas.
While detailed process maps exist based on physical systems, there is no
clear way to integrate them into an enterprise view to execute on a business
simplification mandate.
APPROACH
The enterprise process model becomes the basis for a more consolidated
technology and business footprint. Business partners use the model to
understand how to simplify processes they own, while IT leverages it to
identify application redundancies and technology gaps.
RESULTS
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13%
11%
1%
17%
45%
5%
8%
BUSINESS ARCHITECTURE LOCATION
Where is Business Architecture Located in Your Organization?
Business architecture
is still predominantly
located in IT, under EA.
Discussion Questions:
■■ If business architecture is
in IT but outside EA in your
organization, where does
it sit?
■■ If BA is in IT in your
organization, who
is your primary customer
on the business side?
■■ What role does EA have
in business architecture if it
sits outside of the function?
Other
In the Business with No Connection	
to Enterprise Architecture
In the Business with a Dotted Line	
to Enterprise Architecture
In IT, Under Enterprise Architecture
In IT, but Not Under	
enterprise Architecture
In IT, but Migrating to the Business
Joint Ownership Between	
the Business and IT
n = 96 EAEC member institutions.
Source:	EAEC Membership Survey, January 2011.
Other Responses
■■ In IT Both Under Enterprise Architecture
and in the Lines of Business IT
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Business architecture
sits within the EA and IT
organizations.
■■ Recognizing that content
for the business architecture
should come from the
business, Dell shifts the
makeup of its BA group
away from business SMEs.
Instead, Dell builds a team
with expertise in facilitation
and process modeling.
IT–ALIGNED BUSINESS ARCHITECTURE
CIO
Enterprise Architecture
Architecture Compliance Solutions Architecture
Integration and
Messaging
Process and
Governance
Training Tools
Portfolio
Management
Information
Architecture
Workforce
Management
Strategic
Information and
Architecture Management
Business Architecture
■■ Five core integration staff
and a scalable outsourced
team for facilitation and
modeling
■■ Oversees and integrates
content into the BA model
■■ Interfaces with IT for
solutions and requirements
“Business architects
are not intended to
be the subject matter
experts of our business areas.
Our team’s skill set has shifted
to engagement, facilitation,
and modeling to capture what
the business is really trying to do.”
Leticia Duran
Senior Manager, Enterprise Business
Architecture
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Business
Sixty Business Architects in Total
DECENTRALIZED BUSINESS ARCHITECTURE
ORGANIZATIONAL MODEL
The Business and
Technology Integration
Office (BTIO) sits
between IT and the
business and creates
the business architecture
methodology.
■■ BTIO is responsible for:
–– Enterprise training,
–– Managing business
architecture engagement
through coaching
and mentoring,
–– BA communications and
change management,
–– Stewarding governance
for enterprise BA
frameworks, and
–– Developing strategic-
level target business
architecture.
■■ Within IT, application and
data architects act as the
main points of contact for
business architects.
■■ Business units sponsor their
own business architects
across 21 business areas.
Business Area 21
…
Business Area 2
BA Manager
BA
BA Manager
BASrBA
Business Area 1
BA Manager
Sr. BABA
Information Technology
(64 Architects)
Technical Architecture
Application
Architecture
Data
Architecture
BTIO
(6–8 FTEs)
■■ Enterprise-level
senior business
architects
■■ Enterprise-
level business
architects
EVP/CIO
(Oversees IT, BTIO, and other business groups)
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Business Architecture at
RBC is a shared service
reporting to the business
and operates via a
chargeback model.
■■ The team consists of 20
business architects, split
between lead architects
and supporting architects.
■■ Each business unit has a lead
architect. Depending on the
size of the engagement, the
lead architect may manage
alone or involve supporting
architects from the resource
pool.
FEDERATED BUSINESS ARCHITECTURE
ORGANIZATION
CANADIAN BANKING
Head—Retail Shared Services
Head—Business Architecture
Head—Retail Operations
Supporting
Architects
BU 1 BU 2 BU 3 BU 15
Lead
Architects
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BUSINESS ARCHITECTURE CHALLENGES
What Has Been the Biggest Stumbling Block to Advancing Business Architecture in Your Organization?
The lack of business
engagement remains a
major stumbling block
for many BA groups.
Discussion Questions:
■■ Why is it so hard to get the
business more engaged
and bought into business
architecture?
■■ What techniques have been
effective when trying to:
–– Gain executive
sponsorship?
–– Make a strong business
case?
–– Establish EA credibility?
n = 96 EAEC member institutions.
Source:	EAEC Membership Survey, January 2011.
17%
2%
1%
7%
5%
19%
2%
4%
5%
11%
10%
4%
13%
Other
Inability to Demonstrate the Benefits
Lack of Industry Standards or Commonly
Accepted Framework or Approach
Lack of EA Credibility
Lack of Alignment to IT Architecture
Inability to Retain High-Performing
Business Architects
Lack of a Tool
Lack of Executive Sponsorship
Inability to Make a Strong Business Case
Lack of IT Involvement
Lack of Resources
Inability to Find the Right Individuals
Lack of Business Involvement
Other Responses
■■ Lack of business champion or buy-in
■■ Lack of understanding of business and enterprise
architecture by the business stakeholders
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KEY FINDINGS: EAEC BUSINESS ARCHITECTURE IN PRACTICE STUDY
1. Business architecture is not the capstone of an EA
initiative. Enterprise Architecture groups have incorrectly
viewed business architecture as an aspiration to work toward
after technical, applications, and information architectures
have been established. Business architecture can have
immediate impact on business problems and is not dependent
on maturity attainment in other architecture disciplines.
2. Build your business architecture opportunistically. There
is no linear, prescriptive path to developing a business
architecture. Successful organizations have demonstrated
value by solving specific pain points and using those
success stories to build a mandate for the function.
3. Anchor your business architecture initiative in a set
of business capabilities needed to achieve a specific
objective. The elements included within business
architecture vary across organizations. The reference
section of this study, entitled Business Architecture
Scope and Dimensions, provides several examples. The
successful implementations we’ve seen have all included
business capabilities as a core component of their business
architecture. Capabilities act as the “connective tissue”
linking strategy to business processes and the underlying	
IT architecture.
4. Tie business process modeling more tightly to strategic
objectives. Traditional business process maps are often
too granular to effectively build the business architecture.
Rather than capture detailed physical process steps,
leading organizations model high-level, strategically
valuable processes, using information flows to guide their
work. Avoid tying process models to current owners
and supporting systems. Such an approach impedes a
future state view and ignites turf battles. Instead, leading
organizations remove process models from their existing
physical environment and describe processes in business
terminology.
5. Invest in creating a formal business architect job.
Leading practitioners have recognized that the credibility
of their business architecture initiative depends to a
disproportionate degree on the quality of their business
architects. Yet external business architecture certifications
and experienced senior business architects do not exist in
the market. To retain the best talent, business architecture
requires a formal job and an established career path.
Robust change management mechanisms can drive a
high degree of ownership among the business architect
community and ensure real-world experience informs
the creation of both the training curriculum and business
architect role.
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REPOSITIONING BUSINESS ARCHITECTURE
Architectural Model Lens
Position business
architecture as a
pragmatic tool in service
of the business.
■■ Conventional wisdom
often positions business
architecture as the final
stage of EA maturity.
■■ To effectively sell business
architecture to business
partners, it needs to be
positioned as the most
relevant tool to solve their
problems.
Technical
Architecture
Technical
Architecture
Solutions
Architecture
Solutions
Architecture
Information
Architecture
Information
Architecture
Business
Architecture
Business
Architecture
Low Low
BroadLow NarrowHigh
High High
EAFunctionMaturity
ProximitytoBusinessProblem
EA Value Demonstration Specificity of Solution
Business Problem Solver Lens
“I started our business
architecture effort by
working mostly at the
framework level. It didn’t resonate
with anybody.”
Chief Architect
Health Care Company
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LESSONS LEARNED
Guiding Principles Key Characteristics Potential Hazards
Sponsorship and
Executive Leadership
Align to a influential executive
who possesses many (ideally all)
of the following key dimensions.
■■ Fearless (has been bold, maybe
even failed)
■■ Publicly supportive
■■ A builder
■■ Can see and convey a vision
■■ Comfortable with ambiguity and
uncertainty
■■ Focusing on 100% attainment
of the goal
■■ Requiring immediate results
■■ Not including process metrics
among key performance
indicators
Team Structure
and Competencies
A federated model with clear
lines of sight into relevant lines
of business is desired.
Comprised of individuals who
possess many (ideally all) of the
following competencies.
Federated model benefit
■■ Accountable
■■ Scalable
■■ Consistent
Desirable competencies
■■ Mental agility
■■ Comfort with ambiguity
■■ Inner confidence
■■ Ability and willingness to learn
■■ Taking a solution-driven
rather than a business-driven
approach
■■ Not investing in establishing
credibility
■■ Possessing or perceiving
to possess subject matter
expertise limits creativity
■■ Embedding in IT
Methods Achieve the client’s strategy by
identifying the gaps between the
current and required capability
sets, being sure to articulate the
extent to which the capabilities
meet minimum competitive
standards, up the ante	
or are transformational.
■■ Engaging in thorough research
to accurately articulate current
and desired future states
■■ Informing investment priorities
through gap analysis
■■ Leveraging experience (since
originality is a product of
mastery)
■■ Building skills through
engagements
■■ Searching for a panacea
■■ Rigidly holding on to models
■■ Difficulty in defining where
the industry is likely headed,
where opportunities exist,
and where the organization
wants to be
Tools Establish a target operating
model to allow the goals of the
engagement to either one) be
validated by rolling up to the
higher strategic vision or two)
be passed on to the supporting
projects.
■■ Building tools organically
■■ Reuse, reuse, reuse
■■ Demonstrating flexibility
to create views that are
comfortable to the client
■■ Viewing modeling tools as
complete depictions of reality
Sponsorship, the team,
methods, and tools are
the key success factors
for Business Architecture
at RBC.
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COMPONENTS OF BUSINESS ARCHITECTURE
Which of the Following are Components of Your Business Architecture?
Business strategy,
capabilities, and
processes are the three
most common elements
found in the business
architecture.
Discussion Questions:
■■ How are you linking the
business architecture to your
information architecture?
■■ How is business strategy
incorporated into your
business architecture?
■■ Is there an ideal number of
components to include in
the business architecture?
n= 97 EAEC member institutions
Source: EAEC Membership Survey, January 2011
12%
14%
27%
21%
30%
42%
42%
41%
56%
74%
78%
52%
69%
Other
Facilities
Channel
Partners/Suppliers
Customer
People/Roles
Organization
Products and/or Services
Information
Business Processes
Operating Model
Business Strategy
Business Capabilities
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Business architecture
must connect up to
strategy and down to IT
and related projects.
A CROSS-STACK VIEW OF BUSINESS ARCHITECTURE
Source:	Dols, Jeff, “Business Ownership of Business Architecture,”Cutter IT Journal, March 2008; Wells Fargo Wealth Management Group.
Vision and Objectives
Business Strategy
Business Model
Business Capabilities
Business Process
Information Architecture
Business Case/Initiation
Requirements
Design
Develop/Test QA
Implementation/Support
BUSINESS
DRIVERS
BUSINESS
ARCHITECTURE
Information Management Reference Architecture
DATA
ARCHITECTURE
Applications Reference Architecture
APPLICATIONS
ARCHITECTURE
Infrastructure Reference Architecture
INFRASTRUCTURE
ARCHITECTURE
PROJECT-
LEVEL
ACTIVITIES
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Business processes
are just one of several
business architecture
dimensions.
DWP’S SCOPE FOR BUSINESS
ARCHITECTURE
Customer The customers or customer needs groups who will access the specified service
Channels
The channels provided to deliver and/or access the specified service; may be inbound 	
or outbound
Products 	
and Services
The products and/or services offered as part of the specified service
Processes The underpinning process used to deliver each service
Information Information accessed, gathered, recorded within the service or process
Technology
The details of the technology required to deliver the specified services is described within the
IT architecture, which is driven by the Business Architecture Model
Organization
The organization(s) required to deliver the specified service
The units required within each organization to deliver the specified service(s)
People
The job functions that must be undertaken by our people to deliver the specified service and
the competencies, i.e., skills, knowledge, attitude, and behaviors, that must be displayed to
deliver the specified functions
Physical Sites The physical or logical location where the service will be handled
20
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BUSINESS ARCHITECTURE DIMENSIONS AT SANLAM
Workstream Area of Focus
Strategic Direction
and Outcomes
To define the case for change, develop the vision, obtain buy-in and commitment from leadership, obtain
agreement of outcomes, and monitor benefits
Definition of “WHAT”Service Offering
and Customer Change
To define the detailed enhancements to the “what,” in terms of changes to customer experience
per segment, products and services, and channel configuration while integrating the design across
workstreams delivering the “how”
Products To define the product requirements and specifications that will be used by the concepts to enable 	
the service offering
Design, Develop, and
Implement of “HOW”
Process To define the business requirements and implement associated processes and procedures to support 	
the changed service offering
Information To define the information required to support the business and implement the changes to data types,
data structures, data capturing, storage, and exploitation mechanisms to support the changed service
offering
Technology To design the technological architectures, build applications, and implement the technological
infrastructures required to support the changed service offering
Facilities To identify and implement the changes required to the physical non–IT facilities and delivery channels 	
necessary to support the changed service offering
Organization
and People
To define and implement the changes to the roles, responsibilities, organizational structures, and culture
necessary to support the changed service offering
External Relations To define the changes to the supply chain and business partnerships and institute commercial
arrangements necessary to better support the service offering
Change Management
and Implementation
To manage the migration of various elements of the current business model to the desired state while
maintaining business continuity
Managed by Means of
Project Management
and Change Control
To provide a framework for project leadership, management, and control to ensure successful delivery 	
of business outcomes while managing project progress, risks, issues, contingency, and changes
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BUSINESS CAPABILITY DEVELOPMENT
How Developed Are Business Capabilities in Your Business Architecture?
Business capabilities
are the most common
component found in the
business architecture.
Discussion Questions:
■■ Is your capability model
based on an industry model
or homegrown?
■■ How many levels does your
capability model contain?
■■ How well understood/fluent
are business partners with
your capability model?
■■ How were business
capabilities introduced in
your organization?
Source:	EAEC Membership Survey, January 2011.
n = 95 EAEC member institutions.
27%
Single Business Capability	
Model Used Across the Enterprise
19%
Business Capabilities Not
Used but Plan to Introduce
31%
Business Capabilities Used but on
an Ad Hoc, Project-by-Project Basis
20%
Business Capability Models for
Different Parts of Business,	
Yet to Integrate into a Single
Enterprise-Wide Model
3%
Business Capabilities Not Used
or Planned to Introduce
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	 22
The target operating
model defines all
components of future
state business design
for a given organization.
■■ Business scenarios are
used to help elicit relevant
information from the
business unit, identify areas
for further refinement, and
connect the theoretical
model to the business unit’s
practical environment.
THE TARGET OPERATING MODEL
Operating Model Layers
Strategic
Conceptual
BusinessScenarios
Capability
Physical
MACRO
MICRO
■■ The strategic layer articulates
the direction and vision.
■■ The conceptual layer translates the strategic
vision into how value is delivered to the client
along various dimensions, including the value
chain, products, and channel.
■■ The capability layer expands the conceptual model
into detailed business capabilities and describes
their interrelationships and target maturity levels.
■■ The physical layer decomposes the capabilities
into specific processes, policies/procedures,
organizations, roles, and technologies required
to enable the business capabilities.
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BUSINESS ARCHITECTURE BASE CAPABILITY MODEL
Plan
Analytics
Business Intelligence
Campaign Reporting Analytics
Client Analysis Management
Competitive Intelligence
Measures and Metrics Analytics
Performance Analytics
Profitability Analytics
Root-Cause Analysis and Trending
Assess and Design
Process
Technology
Benchmarking
Standards Management
Strategy Development
Change
Accessibility Management
Execution Management
Change Management
Delivery Management
Program Management
Project Management
Strategy Execution
Run
Adjudication (Underwriting) Origination Servicing
Credit Assessment Account Renewal Account Servicing
Credit Decisioning Application Data Capture Assisted Servicing
Credit Scoring Deal Shaping Claims Processing
Aggregation Pricing Optimization Client Portfolio Management
Aggregation, Building, and Deal Management Product and Service Fit/Next Best Fit Client Servicing
Customer Pricing Product Optimization Fees Management
Product/Service Configuration Quote Generation Funds Transfer Management
Fulfillment Payments Funds Transfer Scheduling
Account Fulfillment Billing Services Overdraft Management
Disbursement Payee Management Pooling
Product Fulfillment Payment Management Product Accounting
Service Fulfillment Pre-Sales (Distribution) Product Servicing
Transaction Fulfillment Client Education Sweeping
Marketing Tax Management
Opportunity Management Transaction and Balance Management
Product/Service Management Transaction Servicing
Sales Planning
Sales
Needs Assessment
Sales Effectiveness Management
Selling/Merchandising
Common
Business Rules Management Client Experience Management Enterprise Portfolio Management Finance Management Knowledge Management
Reconciliation Rules Management Client Preferences Management Approval Conditions Management Expense Control Outsourcing
Rule Composition Client Profile Management Collateral Assessment FA Management Performance Management
Rule Execution Customer Loyalty/Retention Management Collections Financial Analysis Management HR Performance Management
Rule Orchestration Communication Management Corporate Treasury Management Financial Data Modeling Analytics Problem Management
Rule Traceability External Communication Demarking Financial Data Transaction Management Exception Management
Business Process Management Internal Communication Float Management Financial Data Validation Procurement
Modelling and Simulation Notification Internal Audit Management GL Management Quality Assurance
Process Configuration Management Enterprise Content Management Monitoring HR Management Relationship Management
Process Engineering Document Presentment Policy Management Benefits and Compensation Management Advice
Process Governance Indexing Portfolio Quality Management Recruiting and Talent Management Client Relationship Management
Process Methodology Information/Document Management Profitability Roles Management Negotiation
Process Repository Process Management Reconciliation Management Skills Assessment and Training Partner Relationship Management
Workflow Analytics Workflow Management Reinsurance Train, Mentor, and Development Management Service-Level Management
Reporting Workforce Management
Risk Management Integration Management
Securitization Third-Party, Govt., and Reg. Data Integration
Special Assets Management Business Data Integration
Syndication and Participation Channel Integration Management
Client Data Integration
Operational Data Integration
InformationTechnologyCapabilities
Level 1 Capability Level 2 Capability
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
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All Rights Reserved. EAEC9544211SYN
	 24
Each capability in the
reference model has a
standard definition to
ensure consistency across
the enterprise.
■■ Capability definitions are
universal, and any changes
are carefully vetted to ensure
integrity as they underpin
the integrated approach.
■■ BUs will almost certainly use
language that is dissimilar,
requiring capabilities from
service lines to be cross-
checked to the universal
capability set in advance
of any integration efforts.
SAMPLE CAPABILITY DEFINITIONS
Group Level 1 Level 2 Description
Change Accessibility
Management
The management of the process of making the online
channel accessible to people with disabilities or functional
gaps. Accessibility refers to the possibility for everyone,
regardless of physical or technological readiness, to access
and use technology and information products.
Change Execution
Management
Change
Management
Change management enables a planned approach of a
change in an organization. Includes the ability to control
and manage changes to any aspect of how the firm offers/
secures/fulfills and services products, or controlling change
to any aspect of the firm regardless of area.
Change Execution
Management
Program
Management
This refers to the program management office ability to
manage independent projects or portfolio of multiple
ongoing interdependent projects. Program management
provides a layer above project management focusing
on selecting the best group of programs, defining them
in terms of their constituent projects and providing an
infrastructure where projects can be run successfully but
leaving project management to the project management
community. Program management also reflects the emphasis
on coordinating and prioritizing resources across projects,
departments, and entities to insure that resource contention
is managed from a global focus.
Change Execution
Management
Project	
Management
The discipline of organizing and managing resources in such
a way that these resources deliver all the work required to
complete a project within defined scope, time, and cost
constraints
Change Execution
Management
Delivery
Management
The processes, technology, and organizations used to
retrieve, route, and present unstructured data to the
appropriate user at the required stage of a process
dependent on said data
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
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© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN
	 25
BUSINESS ARCHITECTURE MATURITY
How Would You Describe the Relative Maturity of Business Architecture in Your Organization?
Despite business
architecture’s growing
popularity, maturity
levels remain low.
Discussion Questions:
■■ Where has business
architecture had the most
notable impact in your
organization?
■■ What is the biggest
impediment to business
architecture’s maturity?
■■ What has been the most
successful method you
have used to demonstrate
business architecture’s value?
n = 96 EAEC member institutions.
Source:	EAEC Membership Survey, January 2011.
20%
25%
28%
23%
3%
Very Immature—We Just Started
Doing Business Architecture
Very Mature—Business Architecture Is
Delivering Substantial and Quantifiable
Value to Business and IT Partners
Neither Mature nor Immature—
Business Architecture Is in Place,	
but the Results Have Been Mixed
Somewhat Immature—We’ve Set
up a Business Architecture Function,	
but Haven’t Made Much Progress
Somewhat Mature—Business
Architecture Is an Established Function
Whose Contributions Are Recognized, but
We Have Trouble Quantifying the Value
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
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© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN
	 26
RESULTS
Estimated Internal Rate of Return on Projects
Sanlam Personal Finance
Business Design
is delivering value
on multiple levels.
■■ With a greater percentage
of spend now going to
transform and grow projects,
and a greater emphasis on
benefits realization, Sanlam’s
IRR has nearly doubled since
the business change and
business design functions
were created.
“There’s no question
anymore about
the value we bring,
our relevance, and the skills
of our people.”
Dawie Adlem
Head of Business Design
Sanlam Personal Finance
1.	 High Demand for Services—Sanlam’s Business Change team is able to
cover its costs through chargebacks, and its services are oversubscribed.
2.	 Engagements Outside Personal Finance—Approximately 25% of Business
Change’s work now comes from outside Sanlam Personal Finance.
3.	 Strategy Involvement—Business Change is now regularly invited to
business strategy sessions because it is viewed as a value-added partner.
2007 2009
~25%
47%
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
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© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN
	 27
Business Architecture has
had wide-ranging impact
across strategic, structural,
and operational areas
of the bank.
RESULTS
Lines of Business Covered
Includes Full and Partial Coverage
“With a business
architecture, I didn’t
have to do any second-
guessing. I had a clear target
operating model and an
understanding of the required
capabilities. Business architecture
became my high-speed electronic
highway to get me where I
wanted to go.”
Scott Burrows
SVP, Retail Shared Services
Size of Business Architecture Team
Number of FTEs
Select Success Measures
Strategic
■■ Business Architecture contributed to the toolset used to support the expansion of initiative planning
cycles from 12–24 months to four to five years across multiple horizons.
■■ More than 250 duplications have been identified over the next three to five years, which has led	
to more than 20 common infrastructure builds.
Structural
■■ Business Architecture has recommended creating more than 15 Centers of Excellence, ~50% of which
have been implemented, reducing infrastructure costs through shared deployment by 50% in some
cases.
■■ The Enterprise Content Management COE has created a common infrastructure for more 106 projects.
Operational
■■ Business Architecture’s work with COEs has led to more than $50 million in annual savings.
■■ The creation of program portfolios has significantly reduced the number of active projects running	
in the enterprise.
1
15
2004 2009
3
20
2004 2009
28
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
www.eaec.executiveboard.com
© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN
ROADMAP FOR THE PRESENTATION
Business Architecture
Polling Results
Introduction
to Panelist
QA and
Upcoming Events
29
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
IT PRACTICE
www.eaec.executiveboard.com
© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN
UPCOMING EAEC WEBINARS
To register for an upcoming Webinar or member meeting, visit:
https://www.eaec.executiveboard.com/Members/Events/Default.aspx
Webinar:
Redrawing the Boundaries between Applications and Business Ownership: The Vendor Perspective
24 Feb. 	
2011
Webinar:
Building the Internal Cloud: A Review of Emerging Technologies
16 Dec.	
2010
Webinar:
High-Impact Capability Roadmapping
26 Jan.	
2011
Webinar:
Developing Reference Architectures
23 March	
2011
Webinar:
Advances in Business Architecture
16 Feb.
2011
Webinar:
Trends in Enterprise Architecture
15 Dec. 	
2010
INFORMATION TECHNOLOGY PRACTICE
ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™
© 2011 The Corporate Executive Board Company.
All Rights Reserved. EAEC9544211SYN

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EAEC_BusinessArchitecture

  • 1. INFORMATION TECHNOLOGY PRACTICE ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ Advances in Business Architecture Panelist: Parin Kothari, Senior Manager, Business Architecture, Moderator: Bart Kaplan, Senior Director, Enterprise Architecture Executive Council
  • 2. A FRAMEWORK FOR MEMBER CONVERSATIONS The mission of the Corporate Executive Board is to create revolutionary economic advantage for leaders of the world’s great enterprises by enabling them to act with unparalleled intelligence and confidence. We lift their performance at key decision points and career moments by delivering insight drawn from the most powerful global executive and professional network. When we bring leaders together, it is crucial that our discussions neither restrict competition nor improperly share inside information. All other conversations are welcomed and encouraged. We look forward to the continued and robust sharing of insights by member executives and professionals at Corporate Executive Board events. COPIES AND COPYRIGHT As always, members are welcome to an unlimited number of copies of the materials contained within this handout. Furthermore, members may copy any graphic herein for their own internal purpose. The Corporate Executive Board Company requests only that members retain the copyright mark on all pages produced. Please contact your Member Support Center at +1-866-913-8101 for any help we may provide. The pages herein are the property of The Corporate Executive Board Company. Beyond the membership, no copyrighted materials of The Corporate Executive Board Company may be reproduced without prior approval. LEGAL CAVEAT The Enterprise Architecture Executive Council has worked to ensure the accuracy of the information it provides to its members. This report relies upon data obtained from many sources, however, and the Enterprise Architecture Executive Council cannot guarantee the accuracy of the information or its analysis in all cases. Furthermore, the Enterprise Architecture Executive Council is not engaged in rendering legal, accounting, or other professional services. Its reports should not be construed as professional advice on any particular set of facts or circumstances. Members requiring such services are advised to consult an appropriate professional. Neither the The Corporate Executive Board Company nor its programs are responsible for any claims or losses that may arise from a) any errors or omissions in their reports, whether caused by the Enterprise Architecture Executive Council or its sources, or b) reliance upon any recommendation made by the Enterprise Architecture Executive Council.
  • 3. 3 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN ROADMAP FOR THE PRESENTATION Business Architecture Polling Results Introduction to Panelist QA and Upcoming Events
  • 4. 4 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN INTRODUCING PARIN KOTHARI Parin Kothari is an experienced business consultant who started his professional career at Boston Consulting Group in South Asia. Since then, he has worked in varied functional areas—finance, marketing, technology, and operations—and a plethora of industries including banking and financial services, media and advertising, consumer products, industrial services, health care, retail and auto manufacturing. Parin was instrumental in establishing the business architecture practice at Wells Fargo bank’s Internet Services Group and worked on the merger with Wachovia. In his recent job, Parin is working to build the practice for TD Bank Financial Group’s North American Internet Channel group. Parin complements his profit-driving business architecture focus by working alongside grass root local NGOs in more than eight countries across four continents attempting to build a sustainable social architecture. Parin holds his MBA from Syracuse University, New York. TD Bank Financial Group Industry: Financial The Toronto-Dominion Bank, together with its subsidiaries, provides retail and commercial banking, wealth management, and wholesale banking products and services in North America and internationally. The company operates in four segments: Canadian Personal and Commercial Banking, Wealth Management, United States Personal and Commercial Banking, and Wholesale Banking. 2010 Operating Revenues: US$24.91 Billion Employees: 65,930
  • 5. 5 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN ROADMAP FOR THE PRESENTATION Business Architecture Polling Results Introduction to Panelist QA and Upcoming Events
  • 6. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 6 Business architecture’s importance has grown substantially over the past 12 months. Discussion Questions: ■■ What is driving the importance of business architecture in your organization? ■■ Where is the interest coming from? ■■ How are you communicating business architecture’s importance? BUSINESS ARCHITECTURE IMPORTANCE How Has the Importance of Business Architecture in Your Organization Changed in the Past 12 Months? 1% Much Less Important 3% Somewhat Less Important 11% No Change 49% Somewhat Important 35% Much More Important n = 97 EAEC member institutions. Source: EAEC Membership Survey, January 2011.
  • 7. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 7 Business Architecture was created to facilitate strategic alignment and execution. HOW TO STRENGTHEN THE CONNECTION BETWEEN STRATEGY AND EXECUTION CHALLENGES Business Architecture incorporates the use of a target operating model, supported by business capabilities, to better connect strategic vision to the underlying changes to people, process, and technology needed to realize that strategy. APPROACH As its coverage has expanded to 15 lines of business, Business Architecture has helped to extend planning horizons, rationalize project portfolios, lower infrastructure costs, and reduce cycle times. RESULTS Strategy Execution There was a need for a better mechanism to provide traceability of strategic intent and to better balance portfolio spend on strategic and tactical initiatives. Transformation Initiatives To increase spend on transformational change, a portfolio approach to investments was needed. Change Management In moving from a product-centric to a client-centric organization, RBC needed to ensure all dimensions of transformation were addressed (people, process, technology).
  • 8. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 8 Business simplification efforts require an integrated enterprise process view. BUSINESS SILOS AND PORTFOLIO COMPLEXITY CHALLENGE By stripping physical processes of their underlying systems and specific organizational content, Dell creates an integrated, enterprise-wide view of future state processes to drive simplification efforts. Dell’s processes and applications are built out rapidly in support of the company’s growth. This results, however, in complex and siloed business areas. While detailed process maps exist based on physical systems, there is no clear way to integrate them into an enterprise view to execute on a business simplification mandate. APPROACH The enterprise process model becomes the basis for a more consolidated technology and business footprint. Business partners use the model to understand how to simplify processes they own, while IT leverages it to identify application redundancies and technology gaps. RESULTS
  • 9. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 9 13% 11% 1% 17% 45% 5% 8% BUSINESS ARCHITECTURE LOCATION Where is Business Architecture Located in Your Organization? Business architecture is still predominantly located in IT, under EA. Discussion Questions: ■■ If business architecture is in IT but outside EA in your organization, where does it sit? ■■ If BA is in IT in your organization, who is your primary customer on the business side? ■■ What role does EA have in business architecture if it sits outside of the function? Other In the Business with No Connection to Enterprise Architecture In the Business with a Dotted Line to Enterprise Architecture In IT, Under Enterprise Architecture In IT, but Not Under enterprise Architecture In IT, but Migrating to the Business Joint Ownership Between the Business and IT n = 96 EAEC member institutions. Source: EAEC Membership Survey, January 2011. Other Responses ■■ In IT Both Under Enterprise Architecture and in the Lines of Business IT
  • 10. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 10 Business architecture sits within the EA and IT organizations. ■■ Recognizing that content for the business architecture should come from the business, Dell shifts the makeup of its BA group away from business SMEs. Instead, Dell builds a team with expertise in facilitation and process modeling. IT–ALIGNED BUSINESS ARCHITECTURE CIO Enterprise Architecture Architecture Compliance Solutions Architecture Integration and Messaging Process and Governance Training Tools Portfolio Management Information Architecture Workforce Management Strategic Information and Architecture Management Business Architecture ■■ Five core integration staff and a scalable outsourced team for facilitation and modeling ■■ Oversees and integrates content into the BA model ■■ Interfaces with IT for solutions and requirements “Business architects are not intended to be the subject matter experts of our business areas. Our team’s skill set has shifted to engagement, facilitation, and modeling to capture what the business is really trying to do.” Leticia Duran Senior Manager, Enterprise Business Architecture
  • 11. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 11 Business Sixty Business Architects in Total DECENTRALIZED BUSINESS ARCHITECTURE ORGANIZATIONAL MODEL The Business and Technology Integration Office (BTIO) sits between IT and the business and creates the business architecture methodology. ■■ BTIO is responsible for: –– Enterprise training, –– Managing business architecture engagement through coaching and mentoring, –– BA communications and change management, –– Stewarding governance for enterprise BA frameworks, and –– Developing strategic- level target business architecture. ■■ Within IT, application and data architects act as the main points of contact for business architects. ■■ Business units sponsor their own business architects across 21 business areas. Business Area 21 … Business Area 2 BA Manager BA BA Manager BASrBA Business Area 1 BA Manager Sr. BABA Information Technology (64 Architects) Technical Architecture Application Architecture Data Architecture BTIO (6–8 FTEs) ■■ Enterprise-level senior business architects ■■ Enterprise- level business architects EVP/CIO (Oversees IT, BTIO, and other business groups)
  • 12. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 12 Business Architecture at RBC is a shared service reporting to the business and operates via a chargeback model. ■■ The team consists of 20 business architects, split between lead architects and supporting architects. ■■ Each business unit has a lead architect. Depending on the size of the engagement, the lead architect may manage alone or involve supporting architects from the resource pool. FEDERATED BUSINESS ARCHITECTURE ORGANIZATION CANADIAN BANKING Head—Retail Shared Services Head—Business Architecture Head—Retail Operations Supporting Architects BU 1 BU 2 BU 3 BU 15 Lead Architects
  • 13. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 13 BUSINESS ARCHITECTURE CHALLENGES What Has Been the Biggest Stumbling Block to Advancing Business Architecture in Your Organization? The lack of business engagement remains a major stumbling block for many BA groups. Discussion Questions: ■■ Why is it so hard to get the business more engaged and bought into business architecture? ■■ What techniques have been effective when trying to: –– Gain executive sponsorship? –– Make a strong business case? –– Establish EA credibility? n = 96 EAEC member institutions. Source: EAEC Membership Survey, January 2011. 17% 2% 1% 7% 5% 19% 2% 4% 5% 11% 10% 4% 13% Other Inability to Demonstrate the Benefits Lack of Industry Standards or Commonly Accepted Framework or Approach Lack of EA Credibility Lack of Alignment to IT Architecture Inability to Retain High-Performing Business Architects Lack of a Tool Lack of Executive Sponsorship Inability to Make a Strong Business Case Lack of IT Involvement Lack of Resources Inability to Find the Right Individuals Lack of Business Involvement Other Responses ■■ Lack of business champion or buy-in ■■ Lack of understanding of business and enterprise architecture by the business stakeholders
  • 14. 14 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN KEY FINDINGS: EAEC BUSINESS ARCHITECTURE IN PRACTICE STUDY 1. Business architecture is not the capstone of an EA initiative. Enterprise Architecture groups have incorrectly viewed business architecture as an aspiration to work toward after technical, applications, and information architectures have been established. Business architecture can have immediate impact on business problems and is not dependent on maturity attainment in other architecture disciplines. 2. Build your business architecture opportunistically. There is no linear, prescriptive path to developing a business architecture. Successful organizations have demonstrated value by solving specific pain points and using those success stories to build a mandate for the function. 3. Anchor your business architecture initiative in a set of business capabilities needed to achieve a specific objective. The elements included within business architecture vary across organizations. The reference section of this study, entitled Business Architecture Scope and Dimensions, provides several examples. The successful implementations we’ve seen have all included business capabilities as a core component of their business architecture. Capabilities act as the “connective tissue” linking strategy to business processes and the underlying IT architecture. 4. Tie business process modeling more tightly to strategic objectives. Traditional business process maps are often too granular to effectively build the business architecture. Rather than capture detailed physical process steps, leading organizations model high-level, strategically valuable processes, using information flows to guide their work. Avoid tying process models to current owners and supporting systems. Such an approach impedes a future state view and ignites turf battles. Instead, leading organizations remove process models from their existing physical environment and describe processes in business terminology. 5. Invest in creating a formal business architect job. Leading practitioners have recognized that the credibility of their business architecture initiative depends to a disproportionate degree on the quality of their business architects. Yet external business architecture certifications and experienced senior business architects do not exist in the market. To retain the best talent, business architecture requires a formal job and an established career path. Robust change management mechanisms can drive a high degree of ownership among the business architect community and ensure real-world experience informs the creation of both the training curriculum and business architect role.
  • 15. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 15 REPOSITIONING BUSINESS ARCHITECTURE Architectural Model Lens Position business architecture as a pragmatic tool in service of the business. ■■ Conventional wisdom often positions business architecture as the final stage of EA maturity. ■■ To effectively sell business architecture to business partners, it needs to be positioned as the most relevant tool to solve their problems. Technical Architecture Technical Architecture Solutions Architecture Solutions Architecture Information Architecture Information Architecture Business Architecture Business Architecture Low Low BroadLow NarrowHigh High High EAFunctionMaturity ProximitytoBusinessProblem EA Value Demonstration Specificity of Solution Business Problem Solver Lens “I started our business architecture effort by working mostly at the framework level. It didn’t resonate with anybody.” Chief Architect Health Care Company
  • 16. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 16 LESSONS LEARNED Guiding Principles Key Characteristics Potential Hazards Sponsorship and Executive Leadership Align to a influential executive who possesses many (ideally all) of the following key dimensions. ■■ Fearless (has been bold, maybe even failed) ■■ Publicly supportive ■■ A builder ■■ Can see and convey a vision ■■ Comfortable with ambiguity and uncertainty ■■ Focusing on 100% attainment of the goal ■■ Requiring immediate results ■■ Not including process metrics among key performance indicators Team Structure and Competencies A federated model with clear lines of sight into relevant lines of business is desired. Comprised of individuals who possess many (ideally all) of the following competencies. Federated model benefit ■■ Accountable ■■ Scalable ■■ Consistent Desirable competencies ■■ Mental agility ■■ Comfort with ambiguity ■■ Inner confidence ■■ Ability and willingness to learn ■■ Taking a solution-driven rather than a business-driven approach ■■ Not investing in establishing credibility ■■ Possessing or perceiving to possess subject matter expertise limits creativity ■■ Embedding in IT Methods Achieve the client’s strategy by identifying the gaps between the current and required capability sets, being sure to articulate the extent to which the capabilities meet minimum competitive standards, up the ante or are transformational. ■■ Engaging in thorough research to accurately articulate current and desired future states ■■ Informing investment priorities through gap analysis ■■ Leveraging experience (since originality is a product of mastery) ■■ Building skills through engagements ■■ Searching for a panacea ■■ Rigidly holding on to models ■■ Difficulty in defining where the industry is likely headed, where opportunities exist, and where the organization wants to be Tools Establish a target operating model to allow the goals of the engagement to either one) be validated by rolling up to the higher strategic vision or two) be passed on to the supporting projects. ■■ Building tools organically ■■ Reuse, reuse, reuse ■■ Demonstrating flexibility to create views that are comfortable to the client ■■ Viewing modeling tools as complete depictions of reality Sponsorship, the team, methods, and tools are the key success factors for Business Architecture at RBC.
  • 17. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 17 COMPONENTS OF BUSINESS ARCHITECTURE Which of the Following are Components of Your Business Architecture? Business strategy, capabilities, and processes are the three most common elements found in the business architecture. Discussion Questions: ■■ How are you linking the business architecture to your information architecture? ■■ How is business strategy incorporated into your business architecture? ■■ Is there an ideal number of components to include in the business architecture? n= 97 EAEC member institutions Source: EAEC Membership Survey, January 2011 12% 14% 27% 21% 30% 42% 42% 41% 56% 74% 78% 52% 69% Other Facilities Channel Partners/Suppliers Customer People/Roles Organization Products and/or Services Information Business Processes Operating Model Business Strategy Business Capabilities
  • 18. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 18 Business architecture must connect up to strategy and down to IT and related projects. A CROSS-STACK VIEW OF BUSINESS ARCHITECTURE Source: Dols, Jeff, “Business Ownership of Business Architecture,”Cutter IT Journal, March 2008; Wells Fargo Wealth Management Group. Vision and Objectives Business Strategy Business Model Business Capabilities Business Process Information Architecture Business Case/Initiation Requirements Design Develop/Test QA Implementation/Support BUSINESS DRIVERS BUSINESS ARCHITECTURE Information Management Reference Architecture DATA ARCHITECTURE Applications Reference Architecture APPLICATIONS ARCHITECTURE Infrastructure Reference Architecture INFRASTRUCTURE ARCHITECTURE PROJECT- LEVEL ACTIVITIES
  • 19. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 19 Business processes are just one of several business architecture dimensions. DWP’S SCOPE FOR BUSINESS ARCHITECTURE Customer The customers or customer needs groups who will access the specified service Channels The channels provided to deliver and/or access the specified service; may be inbound or outbound Products and Services The products and/or services offered as part of the specified service Processes The underpinning process used to deliver each service Information Information accessed, gathered, recorded within the service or process Technology The details of the technology required to deliver the specified services is described within the IT architecture, which is driven by the Business Architecture Model Organization The organization(s) required to deliver the specified service The units required within each organization to deliver the specified service(s) People The job functions that must be undertaken by our people to deliver the specified service and the competencies, i.e., skills, knowledge, attitude, and behaviors, that must be displayed to deliver the specified functions Physical Sites The physical or logical location where the service will be handled
  • 20. 20 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN BUSINESS ARCHITECTURE DIMENSIONS AT SANLAM Workstream Area of Focus Strategic Direction and Outcomes To define the case for change, develop the vision, obtain buy-in and commitment from leadership, obtain agreement of outcomes, and monitor benefits Definition of “WHAT”Service Offering and Customer Change To define the detailed enhancements to the “what,” in terms of changes to customer experience per segment, products and services, and channel configuration while integrating the design across workstreams delivering the “how” Products To define the product requirements and specifications that will be used by the concepts to enable the service offering Design, Develop, and Implement of “HOW” Process To define the business requirements and implement associated processes and procedures to support the changed service offering Information To define the information required to support the business and implement the changes to data types, data structures, data capturing, storage, and exploitation mechanisms to support the changed service offering Technology To design the technological architectures, build applications, and implement the technological infrastructures required to support the changed service offering Facilities To identify and implement the changes required to the physical non–IT facilities and delivery channels necessary to support the changed service offering Organization and People To define and implement the changes to the roles, responsibilities, organizational structures, and culture necessary to support the changed service offering External Relations To define the changes to the supply chain and business partnerships and institute commercial arrangements necessary to better support the service offering Change Management and Implementation To manage the migration of various elements of the current business model to the desired state while maintaining business continuity Managed by Means of Project Management and Change Control To provide a framework for project leadership, management, and control to ensure successful delivery of business outcomes while managing project progress, risks, issues, contingency, and changes
  • 21. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 21 BUSINESS CAPABILITY DEVELOPMENT How Developed Are Business Capabilities in Your Business Architecture? Business capabilities are the most common component found in the business architecture. Discussion Questions: ■■ Is your capability model based on an industry model or homegrown? ■■ How many levels does your capability model contain? ■■ How well understood/fluent are business partners with your capability model? ■■ How were business capabilities introduced in your organization? Source: EAEC Membership Survey, January 2011. n = 95 EAEC member institutions. 27% Single Business Capability Model Used Across the Enterprise 19% Business Capabilities Not Used but Plan to Introduce 31% Business Capabilities Used but on an Ad Hoc, Project-by-Project Basis 20% Business Capability Models for Different Parts of Business, Yet to Integrate into a Single Enterprise-Wide Model 3% Business Capabilities Not Used or Planned to Introduce
  • 22. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 22 The target operating model defines all components of future state business design for a given organization. ■■ Business scenarios are used to help elicit relevant information from the business unit, identify areas for further refinement, and connect the theoretical model to the business unit’s practical environment. THE TARGET OPERATING MODEL Operating Model Layers Strategic Conceptual BusinessScenarios Capability Physical MACRO MICRO ■■ The strategic layer articulates the direction and vision. ■■ The conceptual layer translates the strategic vision into how value is delivered to the client along various dimensions, including the value chain, products, and channel. ■■ The capability layer expands the conceptual model into detailed business capabilities and describes their interrelationships and target maturity levels. ■■ The physical layer decomposes the capabilities into specific processes, policies/procedures, organizations, roles, and technologies required to enable the business capabilities.
  • 23. 23 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN BUSINESS ARCHITECTURE BASE CAPABILITY MODEL Plan Analytics Business Intelligence Campaign Reporting Analytics Client Analysis Management Competitive Intelligence Measures and Metrics Analytics Performance Analytics Profitability Analytics Root-Cause Analysis and Trending Assess and Design Process Technology Benchmarking Standards Management Strategy Development Change Accessibility Management Execution Management Change Management Delivery Management Program Management Project Management Strategy Execution Run Adjudication (Underwriting) Origination Servicing Credit Assessment Account Renewal Account Servicing Credit Decisioning Application Data Capture Assisted Servicing Credit Scoring Deal Shaping Claims Processing Aggregation Pricing Optimization Client Portfolio Management Aggregation, Building, and Deal Management Product and Service Fit/Next Best Fit Client Servicing Customer Pricing Product Optimization Fees Management Product/Service Configuration Quote Generation Funds Transfer Management Fulfillment Payments Funds Transfer Scheduling Account Fulfillment Billing Services Overdraft Management Disbursement Payee Management Pooling Product Fulfillment Payment Management Product Accounting Service Fulfillment Pre-Sales (Distribution) Product Servicing Transaction Fulfillment Client Education Sweeping Marketing Tax Management Opportunity Management Transaction and Balance Management Product/Service Management Transaction Servicing Sales Planning Sales Needs Assessment Sales Effectiveness Management Selling/Merchandising Common Business Rules Management Client Experience Management Enterprise Portfolio Management Finance Management Knowledge Management Reconciliation Rules Management Client Preferences Management Approval Conditions Management Expense Control Outsourcing Rule Composition Client Profile Management Collateral Assessment FA Management Performance Management Rule Execution Customer Loyalty/Retention Management Collections Financial Analysis Management HR Performance Management Rule Orchestration Communication Management Corporate Treasury Management Financial Data Modeling Analytics Problem Management Rule Traceability External Communication Demarking Financial Data Transaction Management Exception Management Business Process Management Internal Communication Float Management Financial Data Validation Procurement Modelling and Simulation Notification Internal Audit Management GL Management Quality Assurance Process Configuration Management Enterprise Content Management Monitoring HR Management Relationship Management Process Engineering Document Presentment Policy Management Benefits and Compensation Management Advice Process Governance Indexing Portfolio Quality Management Recruiting and Talent Management Client Relationship Management Process Methodology Information/Document Management Profitability Roles Management Negotiation Process Repository Process Management Reconciliation Management Skills Assessment and Training Partner Relationship Management Workflow Analytics Workflow Management Reinsurance Train, Mentor, and Development Management Service-Level Management Reporting Workforce Management Risk Management Integration Management Securitization Third-Party, Govt., and Reg. Data Integration Special Assets Management Business Data Integration Syndication and Participation Channel Integration Management Client Data Integration Operational Data Integration InformationTechnologyCapabilities Level 1 Capability Level 2 Capability
  • 24. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 24 Each capability in the reference model has a standard definition to ensure consistency across the enterprise. ■■ Capability definitions are universal, and any changes are carefully vetted to ensure integrity as they underpin the integrated approach. ■■ BUs will almost certainly use language that is dissimilar, requiring capabilities from service lines to be cross- checked to the universal capability set in advance of any integration efforts. SAMPLE CAPABILITY DEFINITIONS Group Level 1 Level 2 Description Change Accessibility Management The management of the process of making the online channel accessible to people with disabilities or functional gaps. Accessibility refers to the possibility for everyone, regardless of physical or technological readiness, to access and use technology and information products. Change Execution Management Change Management Change management enables a planned approach of a change in an organization. Includes the ability to control and manage changes to any aspect of how the firm offers/ secures/fulfills and services products, or controlling change to any aspect of the firm regardless of area. Change Execution Management Program Management This refers to the program management office ability to manage independent projects or portfolio of multiple ongoing interdependent projects. Program management provides a layer above project management focusing on selecting the best group of programs, defining them in terms of their constituent projects and providing an infrastructure where projects can be run successfully but leaving project management to the project management community. Program management also reflects the emphasis on coordinating and prioritizing resources across projects, departments, and entities to insure that resource contention is managed from a global focus. Change Execution Management Project Management The discipline of organizing and managing resources in such a way that these resources deliver all the work required to complete a project within defined scope, time, and cost constraints Change Execution Management Delivery Management The processes, technology, and organizations used to retrieve, route, and present unstructured data to the appropriate user at the required stage of a process dependent on said data
  • 25. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 25 BUSINESS ARCHITECTURE MATURITY How Would You Describe the Relative Maturity of Business Architecture in Your Organization? Despite business architecture’s growing popularity, maturity levels remain low. Discussion Questions: ■■ Where has business architecture had the most notable impact in your organization? ■■ What is the biggest impediment to business architecture’s maturity? ■■ What has been the most successful method you have used to demonstrate business architecture’s value? n = 96 EAEC member institutions. Source: EAEC Membership Survey, January 2011. 20% 25% 28% 23% 3% Very Immature—We Just Started Doing Business Architecture Very Mature—Business Architecture Is Delivering Substantial and Quantifiable Value to Business and IT Partners Neither Mature nor Immature— Business Architecture Is in Place, but the Results Have Been Mixed Somewhat Immature—We’ve Set up a Business Architecture Function, but Haven’t Made Much Progress Somewhat Mature—Business Architecture Is an Established Function Whose Contributions Are Recognized, but We Have Trouble Quantifying the Value
  • 26. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 26 RESULTS Estimated Internal Rate of Return on Projects Sanlam Personal Finance Business Design is delivering value on multiple levels. ■■ With a greater percentage of spend now going to transform and grow projects, and a greater emphasis on benefits realization, Sanlam’s IRR has nearly doubled since the business change and business design functions were created. “There’s no question anymore about the value we bring, our relevance, and the skills of our people.” Dawie Adlem Head of Business Design Sanlam Personal Finance 1. High Demand for Services—Sanlam’s Business Change team is able to cover its costs through chargebacks, and its services are oversubscribed. 2. Engagements Outside Personal Finance—Approximately 25% of Business Change’s work now comes from outside Sanlam Personal Finance. 3. Strategy Involvement—Business Change is now regularly invited to business strategy sessions because it is viewed as a value-added partner. 2007 2009 ~25% 47%
  • 27. ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN 27 Business Architecture has had wide-ranging impact across strategic, structural, and operational areas of the bank. RESULTS Lines of Business Covered Includes Full and Partial Coverage “With a business architecture, I didn’t have to do any second- guessing. I had a clear target operating model and an understanding of the required capabilities. Business architecture became my high-speed electronic highway to get me where I wanted to go.” Scott Burrows SVP, Retail Shared Services Size of Business Architecture Team Number of FTEs Select Success Measures Strategic ■■ Business Architecture contributed to the toolset used to support the expansion of initiative planning cycles from 12–24 months to four to five years across multiple horizons. ■■ More than 250 duplications have been identified over the next three to five years, which has led to more than 20 common infrastructure builds. Structural ■■ Business Architecture has recommended creating more than 15 Centers of Excellence, ~50% of which have been implemented, reducing infrastructure costs through shared deployment by 50% in some cases. ■■ The Enterprise Content Management COE has created a common infrastructure for more 106 projects. Operational ■■ Business Architecture’s work with COEs has led to more than $50 million in annual savings. ■■ The creation of program portfolios has significantly reduced the number of active projects running in the enterprise. 1 15 2004 2009 3 20 2004 2009
  • 28. 28 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN ROADMAP FOR THE PRESENTATION Business Architecture Polling Results Introduction to Panelist QA and Upcoming Events
  • 29. 29 ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ IT PRACTICE www.eaec.executiveboard.com © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN UPCOMING EAEC WEBINARS To register for an upcoming Webinar or member meeting, visit: https://www.eaec.executiveboard.com/Members/Events/Default.aspx Webinar: Redrawing the Boundaries between Applications and Business Ownership: The Vendor Perspective 24 Feb. 2011 Webinar: Building the Internal Cloud: A Review of Emerging Technologies 16 Dec. 2010 Webinar: High-Impact Capability Roadmapping 26 Jan. 2011 Webinar: Developing Reference Architectures 23 March 2011 Webinar: Advances in Business Architecture 16 Feb. 2011 Webinar: Trends in Enterprise Architecture 15 Dec. 2010
  • 30. INFORMATION TECHNOLOGY PRACTICE ENTERPRISE ARCHITECTURE EXECUTIVE COUNCIL™ © 2011 The Corporate Executive Board Company. All Rights Reserved. EAEC9544211SYN