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Maximising The Value and
Benefits of Enterprise
Architecture


Alan McSweeney
Objective

•   To explain the benefits of implementing Enterprise
    Architecture and to identify how the value of Enterprise
    Architecture can be measured




    December 4, 2010                                           2
Agenda

•   Enterprise Architecture
•   Issues in IT
•   Why Enterprise Architecture
•   Enterprise Architecture Measurement Framework
•   Enterprise Architecture Value Measurement Programme




    December 4, 2010                                      3
Basis for Enterprise Architecture

•   IT systems are:
      − Unmanageably complex and costly to maintain
      − Hindering the organisation's ability to respond to business and economic changing
        environment
      − Not integrated
•   Mission-critical information consistently out-of-date and/or actually incorrect
•   A culture of distrust between the business and technology functions of the
    organisation
•   Unmanaged complexity in IT landscape leads to greater cost and less flexibility
      − Issues include lack of standards, redundant applications, multiple platforms, and
        inconsistent data
      − Enterprise architecture defines a set of tools and methods to address this complexity
      − While benefits of Enterprise Architecture are generally understood, measuring value
        has been a challenge
•   No easy answer but Enterprise Architecture approach is really worth considering
    as a means of addressing these issues systematically


    December 4, 2010                                                                            4
Enterprise Architecture Is/Does …

•   What the organisation does today in terms of IT
•   What the organisation wants to do in the future in terms of IT
•   The Information Technology assets implemented today
•   The Information Technology assets the organisation needs to have in
    the future to best deliver its business goals
•   Defines the framework outlining the vision for systems and
    technology for the organisation
•   Takes the business strategy and translates it into effective change of
    the organisation
•   Manages the Information Technology change roadmap
•   Defines a set of overall principles, a future state vision and an
    implementation and transformation plan
•   Includes standards definitions and strategies for services

    December 4, 2010                                                         5
Scope and Elements of Enterprise Architecture
                                       Enterprise Architecture

       Business
       Architecture
                      Information
                      Architecture

                      Enterprise IT       Enterprise           Enterprise
       Enterprise     Information Systems Security             Architecture
       Information    Architecture        Architecture         Governance
       Technology
       Architecture   Enterprise IT                                           Solution
                      Technology                                              Architecture
                      Infrastructure
                      Architecture


                                       Software Architecture
                           Network and Communications Architecture
                                        Storage Architecture
 December 4, 2010                                                                            6
Key Messages Relating to Enterprise Architecture

•   IT-business alignment has never been so important
•   Alignment must be pursued in the context of
    understanding business processes and priorities
•   Service-orientation is not just for applications
•   Service contracts are not just about function: they
    encapsulate and communicate business priorities to IT
    delivery organisations
•   Enterprise architecture needs to be more inclusive,
    sophisticated, flexible and integrated
•   IT governance models must take all this into account
    December 4, 2010                                        7
IT Too Often Fails to Support Changes Effectively

•   Technology integration is costly, risky and complicated
•   Information is everywhere but getting access to the right
    information at the right time is very difficult
•   Modifying system behaviour takes too long and changes
    are difficult to communicate and implement effectively
•   Much of IT system and operations expenditure is bloated
    and fixed where operations run with excess redundant
    capacity
•   IT seen as a cost centre and not a source of business value


    December 4, 2010                                              8
Business View of IT

•   IT is viewed by the business as being
•   Expensive
•   Not connected with business strategy and operations
•   Unresponsive to the changing needs of business
      − Viewed as a critical issue as business agility and responsiveness are essential
        for competitiveness
•   Undefined and unclear as a business asset
      − In terms of financial cost and value
      − Return on investment and value for money from IT is relatively poor
      − The capability the asset should deliver to the business
•   Not delivering its promises
•   Business change projects cost more and deliver less value than
    expected or promised

    December 4, 2010                                                                      9
Causes of Business View of IT

• Business applications tend to be implemented on a project
  by project basis for specific purposes without overall
  context
• Project benefits and success have been measured on
  specific project costs, value and time to market without
  measuring the long term enterprise-wide cost and value
• Average 75% of total IT budget on RTB operations and 25%
  on new project investment
• Technology innovation has tended to deliver specific short-
  term benefits but in the long term of making things worse
• Just look at previous technology innovations such as
  client/server and 4GLs
    December 4, 2010                                            10
Business Pressures on Information Technology

                                           Globalisation

                       Business and
                        Technology                         Transparency
                         Changes



                                          Information
                                          Technology
                                                                    Service
                    Regulation
                                                                     Focus




                                                     Challenging
                                 Consolidation         Economic
                                                    Circumstances

 December 4, 2010                                                             11
Business Pressures are Driving Business and IT Change

•   Globalisation
      − Customers, partners, suppliers and greater competition
      − Connectedness driving value chains
•   Transparency
      − Industry regulations, consumer pressure and competition driving openness
•   Service Focus
      − Differentiation and shareholder value increasingly derived from service experience
•   Challenging Economic Circumstances
      − Need to cut costs and demonstrate real savings
      − Justify technology investments
•   Consolidation
      − Mergers, acquisitions, takeovers of failing companies
•   Regulation
      − Increased regulation and governance - business is turning to IT to help and IT struggling to respond
        in many cases
•   Business and Technology Changes
      − IT becoming commoditised - growth of standards-based technology means that proprietary
        solutions provide less differentiation
      − Speed of technology change
      − Outsourcing where the right outsourcing decisions require an understanding of how systems
        contribute to the business
    December 4, 2010                                                                                           12
Why Enterprise Architecture

•   Enterprise Architecture is part of a continuum and not a project
      − Emerging technologies influence direction of architecture
      − Must be subject to change management and governance
      − Enterprise Architecture and IT governance should be considered together
•   Principles of architecture should override IT hype and transient technology
      − SOA may be dormant but services and an architectural component continues
      − Cloud computing is just another step along the IT/Architectural evolution and another
        perspective on the future state
•   Need better understanding of integration of enterprise and solutions architecture
•   Enterprise Architecture is about achieving a common language between business
    and IT
•   Enterprise Architecture driven out of the business strategy provides the enterprise
    with the highest degree of alignment between the business and IT
•   The concept of Enterprise Architecture has expanded well beyond the traditional
    notion of technology architecture
      − Now the architecture of the whole enterprise

    December 4, 2010                                                                            13
Enterprise Architecture - Achieving a Common
Language Between Business and IT
•   IT-business alignment requires collaboration between the business
    and the IT organisation to align investment and delivery with
    business goals and to manage business and technology change
•   A common, agreed representation of business activity and goals
•   A common, agreed view of how current and future IT provides
    structured support to the business
•   Key requirements and deliverables:
      −   Investment prioritised in terms of business need
      −   Systems that deliver value to the business
      −   Clear direction from the business about focus, strategy
      −   Collaborative approach to implementing business change



    December 4, 2010                                                    14
Enterprise Architecture and Strategy

•   Provides the fundamental technology and process structure for an IT strategy
•   Provides a strategic context for the evolution of enterprise IT systems in response to the
    constantly changing needs of the business environment
•   Allows individual business units to innovate safely in their pursuit of competitive advantage
    within the context of an integrated IT strategy
•   Enterprise Architecture is designed to ensure alignment between the business and IT
    strategies, operating model, guiding principles, and the software development projects and
    service delivery
•   By taking an enterprise-wide, perspective across all the business services, business units,
    business processes, information, applications and technology, Enterprise Architecture
    ensures the enterprise goals and objectives are addressed as a whole way across all the
    system acquisition/application development projects and their deployment into production
•   Organisations use a business strategy driven architecture approach that focuses on
    translating the key components of the business strategy into a future state vision and an
    architecture road map they can implement
•   Enterprise architecture is integrated with other strategic planning disciplines, such as
    programme/project and application portfolio and management
•   Enterprise Architecture ensures that the long-term vision of the business is preserved as
    the enterprise builds new business capabilities and improves on old ones


    December 4, 2010                                                                                15
Why Manage Enterprise Architecture?
                                                      Duplication in
     Unmanaged                                         Resources to
   Complexity in IT          Increased Cost          Develop, Operate
      Landscape                                       and Maintain
                                                     Business Systems


                    Leads                            Cannot to Exploit
                               Reduced                 Economies of
                     To ..     Flexibility              Loading and
                                                           Scale



                               Delays in                Complexity
                               Delivering                  Causes
                                Changes               Difficulties and
                                                       Uncertainties

                                         … Thus
                                       Negatively     Longer Design,
                                      Impacting on    Build, Test and
                                        Business      Delivery Time
                                     Performance …
 December 4, 2010                                                        16
Why Manage Enterprise Architecture?

                           … To Address This
                             Complexity …




                             Provides a Set of
                            Tools and Methods



                    Provides…

                                                       Need to Measure
                                                 But    Effectiveness of
     Enterprise                                            Enterprise
    Architecture                                        Architecture In
                                                       Order to Maximise
                                                        Business Value


 December 4, 2010                                                          17
Value of Enterprise Architecture
          Appropriate
          and Effective
           Enterprise       … Promotes
          Architecture      Actions and
                          Decisions That …

                                       Align Information Technology Plans and Investments with
                                       Business Priorities and Requirements

                                       Result in More Integrated Operations Responsive to
                                       Customer and Business Requirements

                                       Promote a More Efficient and Effective IT Infrastructure

                                       Facilitate Cross-Organisational Sharing of Enterprise
                                       Information

                                       Recognise Innovations and Best Practices Across the
                                       Enterprise

                                       Ensure Traceability of Decisions Back to Principles and
                                       Rules
 December 4, 2010                                                                                 18
Enterprise Architecture Development and
Implementation Process

                                   Architecture
                                      Vision
                    Architecture
                                                     Business
                      Change
                                                   Architecture
                    Management
                                                                             Data
                                                                          Architecture

                                                           Information
   Implementation                  Requirements
                                                             Systems
     Governance                    Management
                                                           Architecture

                                                                          Solutions and
                                                                           Application
                                                                           Architecture
                     Migration                     Technology
                     Planning                      Architecture
                                   Opportunities
                                   and Solutions



 December 4, 2010                                                                         19
Key Elements/Subsets of Enterprise Architecture

•   There are four key architectural subsets of an overall enterprise
    architecture
      − Business/Business Process Architecture - this defines the business strategy,
        governance, organisation, and key business processes
      − Data and Information Architecture - this describes the structure of an
        organisation's logical and physical data assets and data management resources
      − Solutions/Applications Architecture - this kind of architecture provides a
        blueprint for the individual application systems to be deployed, their
        interactions, and their relationships to the core business processes of the
        organisation
      − Technology and Infrastructure Architecture - this describes the logical
        software and hardware capabilities that are required to support the
        deployment of business, data, and application services and includes IT
        infrastructure, middleware, networks, communications, processing, standards,
        etc.


    December 4, 2010                                                                    20
Issues in Key Elements/Subsets of Enterprise
Architecture
                    •   High variability and lack of standardisation across
 Business and           business units (such as ERP templates), driven by
Business Process        changes in business strategy, governance, organisation
  Architecture          and process
                    •   Inconsistent data definitions, multiple databases,
    Data and            releases and configurations which result in duplication
  Information           of licenses, duplicate and inconsistent information,
  Architecture          complexity in testing
                    •   Multiple vendors, multiple instances and versions
 Solutions and          which add complexity in procurement, development
  Applications          and release management, resulting in higher costs and
  Architecture          longer time to market
                    •   Multiple operating environments, multiple hardware
Technology and          vendors and types, leading to higher maintenance and
 Infrastructure         personnel costs, greater instability and time-to-fix
  Architecture


 December 4, 2010                                                                 21
Benefits of Enterprise Architecture

•   Align IT and business for planning and execution purposes
•   Optimise resources - technology, people and processes
•   Increase business interoperability
•   Reduce complexity in IT infrastructure
•   Improve business agility to support dynamic change
•   Drive re-usability of architecture models and best practices
•   Streamline informed decision making
•   Standardise IT for cost effective delivery of services
•   Eliminate duplication and redundancy and reduce cost of ownership and return on
    investment
•   Reduce risks for future investment
•   Faster, simpler and cheaper procurement
•   Manage information/data and knowledge as a corporate asset
•   Manage change based on a clear understanding of its impact
    December 4, 2010                                                                  22
Risks of No Enterprise Architecture

•   Inability to rapidly respond to challenges driven by business changes
•   Lack of commonality and consistency due to the absence of standards
•   Lack of focus on enterprise requirements
•   Lack of common direction and savings due to synergies
•   Incomplete visibility of the current and future target enterprise architecture vision
•   Inability to predict impacts of future changes
•   Increased gaps and architecture conflicts
•   Dilution and dissipation of critical information and knowledge of the deployed
    solutions
•   Rigidity, redundancy and lack of scalability and flexibility in the deployed solutions
•   Lack of integration, compatibility and interoperability between applications
•   Complex, fragile and costly interfaces between applications
•   Fragmented and ad hoc software development driven by a tactical and reactive
    approach

    December 4, 2010                                                                         23
Issues in Developing Enterprise Architecture

•   Issue 1 - Concentrate on the Plan
      − Focus too intently on analysis and strategy
      − Avoid committing to implementing solutions
      − Architecting inhibits value delivery
•   Issue 2 - Jumping to the Solution
      − Engineering solutions and data implementation
      − Technology has difficulty aligning with enterprise
      − Reinforces gap between business and IT
•   Challenge is to balance evolving strategy, goals, constraints
    with technology solutions


    December 4, 2010                                                24
Justifying Investment in Enterprise Architecture

                                     Investment in
                                       Enterprise
                                      Architecture




                                     … Involves
                                    Challenges …
                                                   Impact of         Different
     Longer Term       Reasons for               Investment in     Investment
     Payback than       Technical                  Enterprise      Approaches
       Other IT     Decisions Difficult           Architecture    Needed Across
     Investments    to Communicate                 Difficult to     Enterprise
                                                    Measure        Architecture



 December 4, 2010                                                                 25
Risks Inherent Investment in Enterprise Architecture




                    Enterprise Architecture Investment Spectrum
           Too Little or On          Investment in        Too Much Means
         Wrong Areas Means             Enterprise             Enterprise
           Operating Costs           Architecture is         Architecture
              Increase as         Sufficient to Deliver   Inhibits Flexibility
          Architecture is Too       Results Without        and Imposes Too
         Complex, Ineffective,   Imposing Unnecessary     Many Constraints -
         Old and Expensive to        Restrictions or         IT Becomes
         Operate and Support           Overhead               Inefficient

                                 “Goldilocks” Zone
 December 4, 2010                                                                26
Enterprise Architecture and Enterprise Architecture
Management
                                          Enterprise Architecture
       Enterprise Architecture
                                              Management


              Defines a framework          Provides the models and
             outlining the vision for        practices for defining,
           systems and technology for     planning and managing the
                an organisation           business and IT capabilities

              Defines a set of overall      Includes business, data,
             principles, a future state   applications and technology
           vision and a transformation     models and principles that
                        plan               support assessments and
                                              investment trade-off
               Include standards          decisions, as well as tactical,
         definitions and strategies for    project-level designs and
             individual IT services                 decisions

 December 4, 2010                                                           27
Relationship Between EA Implementation and
Operation Components

                                                Function
                                                Develops
                                                  EA         Enterprise
                     Enterprise                             Architecture
                    Architecture                             Function/
                                                             Capability

                        EAM Measures and
                                                                    Function
                      Manages the Extent and
                      Operation of the EA and                      Implements
                                                                       EA
                       Provides Governance


                                                              Enterprise
                     Enterprise
                                                             Architecture
                    Architecture
                                                           Implementation
                    Management
                                                            and Operation


 December 4, 2010                                                               28
Outcomes of Effective Enterprise Architecture
Implementation and Operation
•   Specification application architecture requirements
•   Definition of architecture methodology
•   Standardisation of information elements shared between
    systems
•   Modeling of information relationships and lifecycles
•   Deployment integration infrastructure
•   Standardisation of hardware and core software platforms
•   Building of reusable application components


    December 4, 2010                                          29
Enterprise Architecture Linked to Overall Business
Strategy
                                                   Business                Business
                                                   Processes               Systems




                                     Business
    Business            Business                   Enterprise              Solution   Service
                                    Operational
    Strategy           Objectives                 Architecture             Delivery   Delivery
                                      Model



•   Enterprise Architecture aligns
    business strategy, business processes                     Domain
                                                            Architecture
    and IT and provides governance to
    ensure business value and
    competitive advantage is delivered
•   Enterprise Architecture creates                                     Project
    alignment, consistency and unity                                  Architecture
    between objectives at various levels


    December 4, 2010                                                                             30
Enterprise, Domain and Project Architectures

          Overall
         Business     Enabling IT                   •   Enterprise Architecture
       Strategy and
        Objectives
                       Projects                         defines and manages
                                                        overall organisation
                                                        architecture
                      Individual
                       Business      Enabling IT    •   Domain Architecture(s)
                         Unit
                      Objectives
                                      Projects          are subsets of Enterprise
        Enterprise
       Architecture                                     Architecture to enable
                                                        individual business
                                                        unit/domain objectives
                        Domain
                                                        and targets to be met
                      Architecture
                                                    •   Project Architecture(s)
                                                        enable project level
                                       Project          objectives to be met
                                     Architecture

 December 4, 2010                                                                   31
Enterprise Architecture Capability

•   The function that enables an organisation to create, adapt,
    enforce and develop enterprise architecture
      − Equally a part of the business as it is part of IT
      − Role is as much about controlling and focusing IT expenditure as it
        is about identifying necessary change
• Ensures that the IT landscape is aligned to the business
  vision and continues to be aligned to the business strategy
  and operational needs
• Ensures that IT solutions can continuously react to the
  changing needs of the business
• Ensures that the business and financial case for change is
  made

    December 4, 2010                                                          32
Subsets of Overall Enterprise Architecture
                                 Business and
                                Business Process
                                  Architecture




              Technology and                         Data and
               Infrastructure                      Information
                Architecture                       Architecture




                                  Application
                                 And Solution
                                 Architecture


 December 4, 2010                                                 33
Layers of Enterprise Architecture
                     Overall Enterprise Architecture Context, Security, Governance


                      Business and          Data and      Solutions and     Technology and
                     Business Process     Information      Applications      Infrastructure
                       Architecture       Architecture     Architecture       Architecture

Conceptual                                                                 Overall Network
View Defines          Business and        Information      Application           and
What Is              Shared Services        Services        Designs         Infrastructure
Required
                                                                                Design

Logical                Business          Data Sources,                      Infrastructure
View How
                                          Targets and      Business          Services and
It Should Be           Processes
                                             Flows        Applications       Components
Implemented             Designs


Physical                                                   Application     Technical Designs
View Defines           Business          Database and
                                                            Designs,              and
What Should Be         Processes        Message Designs
Implemented                                               Specifications     Specifications

  December 4, 2010                                                                             34
Enterprise Architecture Management

•   Enterprise Architecture needs be a guided strategy that is aligned
    with the needs of the business
•   Enterprise Architecture Capability enables an organisation to create,
    adapt, enforce, and develop its technical architecture
•   Enterprise Architecture Management provides a means to measure
    the effectiveness of Enterprise Architecture and assist organisations
    increase business value delivered by IT systems
•   Enterprise Architecture Management is a capacity rather than a
    programme or an end state architecture
•   Enterprise Architecture Management provides a capability model
    with maturity levels for an organisation to achieve desired level of
    Enterprise Architecture maturity and value
•   Enterprise Architecture Management provides a systematic
    coherent approach to defining, planning, and measuring an
    organisation's IT assets over time

    December 4, 2010                                                        35
Why Invest in Enterprise Architecture

                      Enable      Enable faster and easier    Enable faster response
                     Greater       collaboration through     to business changes and
                     Business       application and data      new demands at lower
                    Agility and
Increased           Flexibility          integration                   cost
 Business
  Value                            IT projects will have a
                                      greater success –
                                                                Solutions will be
                    Increase Use   delivered on time, on
                                                               delivered at lower
                        of IT        budget and to user
                                                              implementation and
                                 requirements – reducing
                                                                operational costs
                                  cost through avoidance
                                         of rework
                                     Increased Success in
                                                                Reduced IT Costs
                                       Solution Delivery

                                                Reduced IT Costs
 December 4, 2010                                                                      36
Why Invest in Enterprise Architecture

•   Business cannot understand why relatively            Solution Lifecycle Costs
    straightforward business changes are costly,
    risky and slow to implement

•   Run The Business improvements and Change
    The Business initiatives are restrained or
    prevented by the IT function because to the
    delay and high cost of implementing changes
                                                                               Post
                                                           Solution      Implementation
•   Lack of Enterprise Architecture means               Implementation   Costs – Support,
    operational and support costs of solutions are           Costs         Operation
    kept high
      − Reduces budget available to be used elsewhere

•   Situation worsened by projects attempting to
    deliver in an isolated fashion to bypass
    inhibitors resulting in further constraints for
    subsequent projects in the medium term




    December 4, 2010                                                                        37
What Manage Enterprise Architecture Value?

•   Understand the current state of Enterprise Architecture
      − Create an accurate view of the current capabilities
      − Define the activities to be worked on in partnership with the business
      − Create a flexible Enterprise Architecture framework that will govern future initiatives
•   Validate Opportunities to Create Business Value
      − Define the initiatives that will create the most value
      − Define a realistic and achievable set of objectives
      − Define value measurement to justify commitment and investment
•   Develop a a Flexible Initiative and Project Portfolio
      − Define the set of initiatives and projects that achieve objectives
      − Positively vet programmes and projects for value
      − Create programmes of work that are justified, measured and managed for value
•   Recognise that Enterprise Architecture is strategic rather than tactical
      − Requires the participation in partnership of business and IT
      − Reach of Enterprise Architecture may extend beyond the organisation



    December 4, 2010                                                                              38
Framework for Enterprise Architecture Management

•   Framework provides a means for assessing the Enterprise
    Architecture maturity level within an organisation
•   Can be used to achieve a target level of organisational
    Enterprise Architecture maturity and therefore value
•   Provides a means for continuously assessing and adjusting
    Enterprise Architecture efforts
•   Development of Enterprise Architecture needs be a
    focussed and managed strategy aligned with the business



    December 4, 2010                                            39
Using Enterprise Architecture Management
Framework
•   Define the scope and role of Enterprise Architecture and
    its management within your organisation
•   Understand your current capability maturity level
•   Systematically develop and manage key capabilities for
    effective and appropriate enterprise architecture
    management that adds business value
•   Evaluate and manage progress over time using a
    consistent set of value-oriented metrics



    December 4, 2010                                           40
Using the Enterprise Architecture Management
Framework

     Define the scope and role
           of Enterprise                        Measure and understand
       Architecture and its                      your current capability
     management within your                          maturity level
           organisation




                                                                            Systematically develop
                                                                               and manage key
                             Evaluate and manage
                                                                           capabilities for effective
                           progress over time using
                                                                               and appropriate
                           a consistent set of value-
                                                                            enterprise architecture
                               oriented metrics
                                                                           management that adds
                                                                                business value



 December 4, 2010                                                                                       41
Dimensions of Enterprise Architecture Management
Framework
                                                     Enterprise
                                                    Architecture
•   Measure state of                                  Practices
    Enterprise Architecture
    along three dimensions
      − Practices
      − Planning
      − People
•   Define facets of each                                           Enterprise
    dimension                                                      Architecture
                                                                     Planning
•   Measure each facet in
    terms of:
      − Associated processes and
        their state of development
      − Scope or extent within the    Enterprise
        organisation                 Architecture
                                      Personnel
    December 4, 2010                                                              42
Measurement of Value of Enterprise Architecture

•   Direct link between Enterprise Architecture and real value
    can be difficult to demonstrate
•   There is a time lag between implementation and results




    December 4, 2010                                             43
Measurement of Value of Enterprise Architecture

•   Define Enterprise Architecture value measurement areas
•   Identify measurement process
•   Measure
      − Establish current baseline
      − Define target
      − Measure results against baseline and target




    December 4, 2010                                         44
Measurement Framework for Enterprise
Architecture Management
                                     Enterprise Architecture
                                    Management Framework


  EAM Dimension 1 -                    EAM Dimension 2 -                  EAM Dimension 3 -
Enterprise Architecture              Enterprise Architecture            Enterprise Architecture
       Practices                            Planning                          Personnel


                       1.1 Architecture                                                     3.1 Organisation
                                                       2.1 Strategic Planning
                         Framework                                                         Structure and Skills


                       1.2 Architecture                                                  3.2 Communication and
                                                     2.2 Architecture Planning
                          Processes                                                     Stakeholder Management


                       1.3 Architecture
                         Governance



                    1.4 Architecture Value

 December 4, 2010                                                                                                 45
Measurement Framework for Enterprise
Architecture Management
                       Architecture      Framework of standards, templates and specifications for organising
                       Framework         and presenting business and technical architecture components
                       Architecture      Methodology for defining, developing and maintaining architecture
 Enterprise             Processes        components
Architecture
  Practices            Architecture      Principles, decision rights, rules and methods to drive architecture
                       Governance        development and alignment in the organisation
                    Architecture Value Defining, measuring and communicating the value and impact of
                                       architecture to the business
                    Strategic Planning Using architecture principles and blueprints to align business needs
 Enterprise                            with IT capabilities, define portfolio strategy and direction and allocate
Architecture                           resources
  Planning             Architecture      Defining vision and roadmap for various IT domains by anticipating
                         Planning        business needs and trends, and developing architecture components
                       Organisation      Defining, planning, and managing roles, responsibilities and skills for
                    Structure and Skills architecture management
 Enterprise
Architecture         Communication
                     and Stakeholder     Managing communication and expectations with business and IT
                      Management         stakeholders interested in or influenced by architecture management

 December 4, 2010                                                                                                   46
Measurement Framework for Enterprise
Architecture Management
•   Measure in terms of
      − Processes – those processes associated with Enterprise
        Architecture Management and their state of development – how
        well-defined and effective are the processes
      − Reach - scope or extent of Enterprise Architecture Management
        within the organisation – how widely used




    December 4, 2010                                                    47
Enterprise Architecture Management Assessment
 Framework
                         Processes are
                          Optimised,
                      Flexible, Adaptable
                           and Lean
                         Processes are
                         Managed and
                            There is
                          Continuous
                         improvement
 Enterprise
                        Processes are
Architecture           Repeatable and
 Processes            Consistently Used
                      Across Teams and
                           Projects

                      Basic Processes and
                           Associated
                       Collateral in Place


                       Ad-Hoc Processes
                      Defined and Driven
                        by Individuals

                                                                                           Across the      Beyond the
                                               Within                                     Organisation,    Organisation
                                                          Within an IT   Across the IT
                                             Individual                                     Including       (Suppliers,
                                                           Domain          Function
                                              Projects                                   Business and IT     Partners,
                                                                                           Functions       Customers)

   December 4, 2010                                          Enterprise Architecture Reach                                48
Detailed Measurement Framework for Enterprise
  Architecture Management
                                                          Enterprise Architecture
                                                         Management Framework


  EAM Dimension 1 -                                            EAM Dimension 2 -                                            EAM Dimension 3 -
Enterprise Architecture                                      Enterprise Architecture                                      Enterprise Architecture
       Practices                                                    Planning                                                    Personnel


                                1.1 Architecture                                                                                                        3.1 Organisation
                                                                                         2.1 Strategic Planning
                                  Framework                                                                                                            Structure and Skills




                    Processes                        Reach                       Processes                        Reach                       Processes                       Reach

                                                                                                                                                     3.2 Communication and
                                1.2 Architecture
                                                                                        2.2 Architecture Planning                                          Stakeholder
                                   Processes
                                                                                                                                                          Management



                    Processes                        Reach                       Processes                        Reach                       Processes                       Reach

                                1.3 Architecture
                                  Governance




                    Processes                        Reach


                            1.4 Architecture Value




                    Processes                        Reach
       December 4, 2010                                                                                                                                                               49
Complete Measurement Framework
                                              Processes
                                                                    Enterprise
•   Three                                                          Architecture
                                                                     Planning
    dimensions x
    two aspects                                               Processes
                        Enterprise
                       Architecture
                        Personnel
                         Reach                                            Processes




                                      Reach


                                                         Enterprise
                                                        Architecture
                                                   Reach Practices
    December 4, 2010                                                              50
Enterprise Architecture Management Maturity
                                             Level 1               Level 2                    Level 3                    Level 4                     Level 5
                                                                                       Prioritization of project    Architecture a key        Business / IT planning
                     Strategic Planning        None              Project-based            portfolio based on           input to joint       enables efficiency, agility in
                                                                                               roadmap             Business / IT planning      extended enterprise

                                                               Limited vision and       Architecture planning           Continuous              Includes extended
Planning        Architecture Planning     Project-based
                                                                    roadmap              process established           improvement            enterprise capabilities

                                           Project-based      Central architecture      Funded from efficiency     Funding by margin on
                                                                                                                                              Funding by transaction
                 Architecture Funding        allocation               fund                      gains                    services

                                                             Limited framework -        Covers Information and
                                                                                                                 Consistently adopted           Framework shared
               Architecture Framework          None              covers some           process, but adoption not
                                                                                                                      internally                    externally
                                                                 information                  consistent

                                                              Defined processes                                      Defined processes        Defined processes with
                                          Project-based                                  Defined processes
                Architecture Processes                       primarily focused on                                  across business and IT    clear ability to adapt and
                                            processes                                    across IT domains
                                                                infrastructure                                            domains                      extend
Practices
                                                             Some review principles                                Shared governance         Business / IT governance
                                          None / project-      defined for some          Defined IT governance
                        Governance                                                                                 model with Business      continuously improved to
                                             based               components              boards and processes
                                                                                                                         and IT                respond to change

                                                                                                                   Defined and measured
                                          None / project-                                IT cost performance                                  Business outcomes and IT
               Value and Measurement                             IT cost metrics                                    business objectives,
                                             based                                              metrics                                         performance metrics
                                                                                                                    performance metrics

                Organization Structure       No roles,         Formal technology        Formalized roles and        Clear professional       Pro-active development
                      and Skills          responsibilities    roles within projects       responsibilities             career track            with external input

 People                                                                                                                 Pro-active
                 Communication and                              Key stakeholders        Regular consultation        communication and           Collaboration with
                                          Project-based
              Stakeholder Management                         identified and informed       with business              feedback with            extended enterprise
                                                                                                                         business
  December 4, 2010                                                                                                                                                        51
Assessing Current and Future Desired Architecture
Management Maturity
                                      1 - Ad-Hoc   2 - Defined 3 - Repeatable 4 - Managed 5 - Optimised
                     Architecture
                     Framework
                     Architecture
      Enterprise      Processes
     Architecture
       Practices     Architecture
                     Governance
                     Architecture
                        Value
                       Strategic
      Enterprise       Planning
     Architecture
       Planning      Architecture
                       Planning
                     Organisation
                     Structure and
      Enterprise         Skills
     Architecture
       People     Communication
                  and Stakeholder
                   Management

           Current EA Competency Maturity Level         Desired Future EA Competency Maturity Level
 December 4, 2010                                                                                         52
Measuring Maturity and Importance


                    5.0




                    4.0

        Level                                    Organisation
                                                  Structure
           Of                                     and Skills           Architecture       Architecture
                    3.0                                                 Processes          Planning
     Maturity
                                                                                                 Communication
                                                        Architecture                             and Stakeholder
                                                           Value                                  Management

                    2.0
                                         Architecture
                                         Governance                    Architecture     Strategic
                                                                       Framework        Planning
                    1.0
                          1.0   2.0            3.0              4.0               5.0

                                      Level of Importance
 December 4, 2010                                                                                                  53
Benefits of Increasing Enterprise Architecture
Management Maturity
•   Measuring the true impact of increasing Enterprise
    Architecture Management maturity is hard to achieve
•   IT architecture simplification can be one of the largest
    contributors tor IT cost reduction (in the range of 5%-18%)
    but it has a long lead time - up to 2 years




    December 4, 2010                                              54
Outcomes of Effective Enterprise Architecture
Management
                             Modeling Information
                              Relationships and
      Standardising               Lifecycles
  Information Elements                               Deploying Integration
 Shared Between Systems                                 Infrastructure



 Standardising Hardware                              Specifying Application
    and Core Software                                    Architecture
        Platforms                                       Requirements



    Building Reusable                                Defining Architecture
 Application Components                                  Methodology




                    Reduced Costs    &        Service
                                           Improvements

 December 4, 2010                                                             55
Impact of Effective Enterprise Architecture
Management Can Be Difficult to Quantify
Primary/ Immediate                  Secondary/ Medium-                        Tertiary/ Long-Term
     Benefits                          Term Benefits                                Benefits
 Lower integration costs (and                                               Improved responsiveness to business
                                     Rationalised application portfolio
 corresponding project costs)                                                             needs

 Shorter integration time (and         Integrated infrastructure and
                                                                               Better IT and business decisions
  corresponding project time             application management
Increased hardware utilisation
                                  Renegotiation/consolidation of supplier
  and deferred or eliminated                                                        Higher IT productivity
                                                contracts
       hardware spend

   Simplified development               Better information quality                Reduced operational risk

                                                                            Improved operational efficiency and
Simplified analysis and testing        Faster access to information
                                                                                      effectiveness

Eliminated or reduced spend on
                                     Higher application development
redundant application purchase                                                    Sustained cost reductions
                                              productivity
       and development
  Leverage new capabilities                                                 Increase flexibility within the business
                                           Lower capital spend
  for competitive advantage                                                                   and IT
  December 4, 2010                                                                                                     56
Impact of Effective Enterprise Architecture
Management Can Be Difficult to Quantify

              Primary/                Secondary/                     Tertiary/
             Immediate               Medium-Term                    Long-Term
              Benefits                 Benefits                      Benefits
                         Scope and Benefits of Enterprise Architecture Over Time




           Directly                  Difficult to
         Quantifiable                  Define                      Intangible

         Ease of Measuring Benefits of Enterprise Architecture




 December 4, 2010                                                                  57
Measuring Quantitive and Qualitative Value from
Enterprise Architecture
                                                            Measures of Value
                                                             from Enterprise
                                                               Architecture

                     Quantitive Measures of                                              Qualitative Measures
                              Value                                                            of Value


Reduced Project Risk                Reduction in project time and cost      Improved Business          Reductions in faults and overspend
                                     over-runs both without scope or
  and Complexity                                                          Requirements Delivery          due to incorrect requirements
                                            quality reduction



 Improved Project                   Solution quality, delivery on-time    Better Alignment with        Quality-related feedback from the
                                      and within budget and to user
     Success                                                                     Business              business through regular surveys
                                               satisfaction


  Cost Control and                                                                                     Measure through feedback where
                                    Measuring return on projects over     Increased Agility and          IT is viewed as an partner and
Improved Return on                              lifetime                                               enabler with the business and not
                                                                            Competitiveness
    Investment                                                                                              just a cost and constraint


 Reduced Costs for                                                                                      Measure through effect with the
                                    Complete operational costs of IT to    Improved Business              business becoming better
 Business As Usual                  reflect the total cost of ownership                                 connected and greater reach of
                                                                              Knowledge
    Operations                                                                                                    processes



Enable Delivery of IT                  Sustained delivery of the IT
                                      Strategy which should also be
     Strategy                        concerned with delivering value
  December 4, 2010                                                                                                                    58
Focussing on Areas of Low Maturity and High
Importance


                               Fourth Areas To Focus     Second Areas To Focus
                     High         On To Generate            On To Generate
                    Maturity
                                  Improvements               Improvements

Maturity


                     Low       Third Areas To Focus On   First Areas To Focus On
                    Maturity         To Generate               To Generate
                                    Improvements              Improvements



                                Low View of Importance   High View of Importance

                                                Importance
 December 4, 2010                                                                  59
Focussing on Areas of Low Maturity and High
Importance
•   Use Enterprise Architecture measurement framework to
    identify areas of greatest return on investment




    December 4, 2010                                       60
Enterprise Architecture Value Measurement
Programme
                                           Feedback on Measurement Framework


                                                              Plan Enterprise
                Define
                              Measure           Analyse        Architecture
              Enterprise
                             Enterprise       Enterprise     Implementation       Execute
             Architecture
                            Architecture     Architecture     /Enhancement      Programme
             Measurement
                               Value        Value Measures    Programme of
              Framework
                                                                   Work



                                                    Measure Delivery and Results
•   Does the Enterprise Architecture programme have a measurable impact on the IT
    investment portfolio?
•   Does the Enterprise Architecture programme lead to measurable improvements
    of performance?
•   Is there a clear relationship between Enterprise Architecture programme and
    business services?
•   Does the Enterprise Architecture programme result in measurable cost
    savings/avoidance?

    December 4, 2010                                                                        61
Summary

•   Appropriate Enterprise Architecture can deliver significant
    business benefits
•   Comprehensive Enterprise Architecture value
    measurement framework is needed to link Enterprise
    Architecture to business benefits




    December 4, 2010                                              62
More Information

          Alan McSweeney
          alan@alanmcsweeney.com




 December 4, 2010                  63

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Maximising The Value and Benefits of Enterprise Architecture

  • 1. Maximising The Value and Benefits of Enterprise Architecture Alan McSweeney
  • 2. Objective • To explain the benefits of implementing Enterprise Architecture and to identify how the value of Enterprise Architecture can be measured December 4, 2010 2
  • 3. Agenda • Enterprise Architecture • Issues in IT • Why Enterprise Architecture • Enterprise Architecture Measurement Framework • Enterprise Architecture Value Measurement Programme December 4, 2010 3
  • 4. Basis for Enterprise Architecture • IT systems are: − Unmanageably complex and costly to maintain − Hindering the organisation's ability to respond to business and economic changing environment − Not integrated • Mission-critical information consistently out-of-date and/or actually incorrect • A culture of distrust between the business and technology functions of the organisation • Unmanaged complexity in IT landscape leads to greater cost and less flexibility − Issues include lack of standards, redundant applications, multiple platforms, and inconsistent data − Enterprise architecture defines a set of tools and methods to address this complexity − While benefits of Enterprise Architecture are generally understood, measuring value has been a challenge • No easy answer but Enterprise Architecture approach is really worth considering as a means of addressing these issues systematically December 4, 2010 4
  • 5. Enterprise Architecture Is/Does … • What the organisation does today in terms of IT • What the organisation wants to do in the future in terms of IT • The Information Technology assets implemented today • The Information Technology assets the organisation needs to have in the future to best deliver its business goals • Defines the framework outlining the vision for systems and technology for the organisation • Takes the business strategy and translates it into effective change of the organisation • Manages the Information Technology change roadmap • Defines a set of overall principles, a future state vision and an implementation and transformation plan • Includes standards definitions and strategies for services December 4, 2010 5
  • 6. Scope and Elements of Enterprise Architecture Enterprise Architecture Business Architecture Information Architecture Enterprise IT Enterprise Enterprise Enterprise Information Systems Security Architecture Information Architecture Architecture Governance Technology Architecture Enterprise IT Solution Technology Architecture Infrastructure Architecture Software Architecture Network and Communications Architecture Storage Architecture December 4, 2010 6
  • 7. Key Messages Relating to Enterprise Architecture • IT-business alignment has never been so important • Alignment must be pursued in the context of understanding business processes and priorities • Service-orientation is not just for applications • Service contracts are not just about function: they encapsulate and communicate business priorities to IT delivery organisations • Enterprise architecture needs to be more inclusive, sophisticated, flexible and integrated • IT governance models must take all this into account December 4, 2010 7
  • 8. IT Too Often Fails to Support Changes Effectively • Technology integration is costly, risky and complicated • Information is everywhere but getting access to the right information at the right time is very difficult • Modifying system behaviour takes too long and changes are difficult to communicate and implement effectively • Much of IT system and operations expenditure is bloated and fixed where operations run with excess redundant capacity • IT seen as a cost centre and not a source of business value December 4, 2010 8
  • 9. Business View of IT • IT is viewed by the business as being • Expensive • Not connected with business strategy and operations • Unresponsive to the changing needs of business − Viewed as a critical issue as business agility and responsiveness are essential for competitiveness • Undefined and unclear as a business asset − In terms of financial cost and value − Return on investment and value for money from IT is relatively poor − The capability the asset should deliver to the business • Not delivering its promises • Business change projects cost more and deliver less value than expected or promised December 4, 2010 9
  • 10. Causes of Business View of IT • Business applications tend to be implemented on a project by project basis for specific purposes without overall context • Project benefits and success have been measured on specific project costs, value and time to market without measuring the long term enterprise-wide cost and value • Average 75% of total IT budget on RTB operations and 25% on new project investment • Technology innovation has tended to deliver specific short- term benefits but in the long term of making things worse • Just look at previous technology innovations such as client/server and 4GLs December 4, 2010 10
  • 11. Business Pressures on Information Technology Globalisation Business and Technology Transparency Changes Information Technology Service Regulation Focus Challenging Consolidation Economic Circumstances December 4, 2010 11
  • 12. Business Pressures are Driving Business and IT Change • Globalisation − Customers, partners, suppliers and greater competition − Connectedness driving value chains • Transparency − Industry regulations, consumer pressure and competition driving openness • Service Focus − Differentiation and shareholder value increasingly derived from service experience • Challenging Economic Circumstances − Need to cut costs and demonstrate real savings − Justify technology investments • Consolidation − Mergers, acquisitions, takeovers of failing companies • Regulation − Increased regulation and governance - business is turning to IT to help and IT struggling to respond in many cases • Business and Technology Changes − IT becoming commoditised - growth of standards-based technology means that proprietary solutions provide less differentiation − Speed of technology change − Outsourcing where the right outsourcing decisions require an understanding of how systems contribute to the business December 4, 2010 12
  • 13. Why Enterprise Architecture • Enterprise Architecture is part of a continuum and not a project − Emerging technologies influence direction of architecture − Must be subject to change management and governance − Enterprise Architecture and IT governance should be considered together • Principles of architecture should override IT hype and transient technology − SOA may be dormant but services and an architectural component continues − Cloud computing is just another step along the IT/Architectural evolution and another perspective on the future state • Need better understanding of integration of enterprise and solutions architecture • Enterprise Architecture is about achieving a common language between business and IT • Enterprise Architecture driven out of the business strategy provides the enterprise with the highest degree of alignment between the business and IT • The concept of Enterprise Architecture has expanded well beyond the traditional notion of technology architecture − Now the architecture of the whole enterprise December 4, 2010 13
  • 14. Enterprise Architecture - Achieving a Common Language Between Business and IT • IT-business alignment requires collaboration between the business and the IT organisation to align investment and delivery with business goals and to manage business and technology change • A common, agreed representation of business activity and goals • A common, agreed view of how current and future IT provides structured support to the business • Key requirements and deliverables: − Investment prioritised in terms of business need − Systems that deliver value to the business − Clear direction from the business about focus, strategy − Collaborative approach to implementing business change December 4, 2010 14
  • 15. Enterprise Architecture and Strategy • Provides the fundamental technology and process structure for an IT strategy • Provides a strategic context for the evolution of enterprise IT systems in response to the constantly changing needs of the business environment • Allows individual business units to innovate safely in their pursuit of competitive advantage within the context of an integrated IT strategy • Enterprise Architecture is designed to ensure alignment between the business and IT strategies, operating model, guiding principles, and the software development projects and service delivery • By taking an enterprise-wide, perspective across all the business services, business units, business processes, information, applications and technology, Enterprise Architecture ensures the enterprise goals and objectives are addressed as a whole way across all the system acquisition/application development projects and their deployment into production • Organisations use a business strategy driven architecture approach that focuses on translating the key components of the business strategy into a future state vision and an architecture road map they can implement • Enterprise architecture is integrated with other strategic planning disciplines, such as programme/project and application portfolio and management • Enterprise Architecture ensures that the long-term vision of the business is preserved as the enterprise builds new business capabilities and improves on old ones December 4, 2010 15
  • 16. Why Manage Enterprise Architecture? Duplication in Unmanaged Resources to Complexity in IT Increased Cost Develop, Operate Landscape and Maintain Business Systems Leads Cannot to Exploit Reduced Economies of To .. Flexibility Loading and Scale Delays in Complexity Delivering Causes Changes Difficulties and Uncertainties … Thus Negatively Longer Design, Impacting on Build, Test and Business Delivery Time Performance … December 4, 2010 16
  • 17. Why Manage Enterprise Architecture? … To Address This Complexity … Provides a Set of Tools and Methods Provides… Need to Measure But Effectiveness of Enterprise Enterprise Architecture Architecture In Order to Maximise Business Value December 4, 2010 17
  • 18. Value of Enterprise Architecture Appropriate and Effective Enterprise … Promotes Architecture Actions and Decisions That … Align Information Technology Plans and Investments with Business Priorities and Requirements Result in More Integrated Operations Responsive to Customer and Business Requirements Promote a More Efficient and Effective IT Infrastructure Facilitate Cross-Organisational Sharing of Enterprise Information Recognise Innovations and Best Practices Across the Enterprise Ensure Traceability of Decisions Back to Principles and Rules December 4, 2010 18
  • 19. Enterprise Architecture Development and Implementation Process Architecture Vision Architecture Business Change Architecture Management Data Architecture Information Implementation Requirements Systems Governance Management Architecture Solutions and Application Architecture Migration Technology Planning Architecture Opportunities and Solutions December 4, 2010 19
  • 20. Key Elements/Subsets of Enterprise Architecture • There are four key architectural subsets of an overall enterprise architecture − Business/Business Process Architecture - this defines the business strategy, governance, organisation, and key business processes − Data and Information Architecture - this describes the structure of an organisation's logical and physical data assets and data management resources − Solutions/Applications Architecture - this kind of architecture provides a blueprint for the individual application systems to be deployed, their interactions, and their relationships to the core business processes of the organisation − Technology and Infrastructure Architecture - this describes the logical software and hardware capabilities that are required to support the deployment of business, data, and application services and includes IT infrastructure, middleware, networks, communications, processing, standards, etc. December 4, 2010 20
  • 21. Issues in Key Elements/Subsets of Enterprise Architecture • High variability and lack of standardisation across Business and business units (such as ERP templates), driven by Business Process changes in business strategy, governance, organisation Architecture and process • Inconsistent data definitions, multiple databases, Data and releases and configurations which result in duplication Information of licenses, duplicate and inconsistent information, Architecture complexity in testing • Multiple vendors, multiple instances and versions Solutions and which add complexity in procurement, development Applications and release management, resulting in higher costs and Architecture longer time to market • Multiple operating environments, multiple hardware Technology and vendors and types, leading to higher maintenance and Infrastructure personnel costs, greater instability and time-to-fix Architecture December 4, 2010 21
  • 22. Benefits of Enterprise Architecture • Align IT and business for planning and execution purposes • Optimise resources - technology, people and processes • Increase business interoperability • Reduce complexity in IT infrastructure • Improve business agility to support dynamic change • Drive re-usability of architecture models and best practices • Streamline informed decision making • Standardise IT for cost effective delivery of services • Eliminate duplication and redundancy and reduce cost of ownership and return on investment • Reduce risks for future investment • Faster, simpler and cheaper procurement • Manage information/data and knowledge as a corporate asset • Manage change based on a clear understanding of its impact December 4, 2010 22
  • 23. Risks of No Enterprise Architecture • Inability to rapidly respond to challenges driven by business changes • Lack of commonality and consistency due to the absence of standards • Lack of focus on enterprise requirements • Lack of common direction and savings due to synergies • Incomplete visibility of the current and future target enterprise architecture vision • Inability to predict impacts of future changes • Increased gaps and architecture conflicts • Dilution and dissipation of critical information and knowledge of the deployed solutions • Rigidity, redundancy and lack of scalability and flexibility in the deployed solutions • Lack of integration, compatibility and interoperability between applications • Complex, fragile and costly interfaces between applications • Fragmented and ad hoc software development driven by a tactical and reactive approach December 4, 2010 23
  • 24. Issues in Developing Enterprise Architecture • Issue 1 - Concentrate on the Plan − Focus too intently on analysis and strategy − Avoid committing to implementing solutions − Architecting inhibits value delivery • Issue 2 - Jumping to the Solution − Engineering solutions and data implementation − Technology has difficulty aligning with enterprise − Reinforces gap between business and IT • Challenge is to balance evolving strategy, goals, constraints with technology solutions December 4, 2010 24
  • 25. Justifying Investment in Enterprise Architecture Investment in Enterprise Architecture … Involves Challenges … Impact of Different Longer Term Reasons for Investment in Investment Payback than Technical Enterprise Approaches Other IT Decisions Difficult Architecture Needed Across Investments to Communicate Difficult to Enterprise Measure Architecture December 4, 2010 25
  • 26. Risks Inherent Investment in Enterprise Architecture Enterprise Architecture Investment Spectrum Too Little or On Investment in Too Much Means Wrong Areas Means Enterprise Enterprise Operating Costs Architecture is Architecture Increase as Sufficient to Deliver Inhibits Flexibility Architecture is Too Results Without and Imposes Too Complex, Ineffective, Imposing Unnecessary Many Constraints - Old and Expensive to Restrictions or IT Becomes Operate and Support Overhead Inefficient “Goldilocks” Zone December 4, 2010 26
  • 27. Enterprise Architecture and Enterprise Architecture Management Enterprise Architecture Enterprise Architecture Management Defines a framework Provides the models and outlining the vision for practices for defining, systems and technology for planning and managing the an organisation business and IT capabilities Defines a set of overall Includes business, data, principles, a future state applications and technology vision and a transformation models and principles that plan support assessments and investment trade-off Include standards decisions, as well as tactical, definitions and strategies for project-level designs and individual IT services decisions December 4, 2010 27
  • 28. Relationship Between EA Implementation and Operation Components Function Develops EA Enterprise Enterprise Architecture Architecture Function/ Capability EAM Measures and Function Manages the Extent and Operation of the EA and Implements EA Provides Governance Enterprise Enterprise Architecture Architecture Implementation Management and Operation December 4, 2010 28
  • 29. Outcomes of Effective Enterprise Architecture Implementation and Operation • Specification application architecture requirements • Definition of architecture methodology • Standardisation of information elements shared between systems • Modeling of information relationships and lifecycles • Deployment integration infrastructure • Standardisation of hardware and core software platforms • Building of reusable application components December 4, 2010 29
  • 30. Enterprise Architecture Linked to Overall Business Strategy Business Business Processes Systems Business Business Business Enterprise Solution Service Operational Strategy Objectives Architecture Delivery Delivery Model • Enterprise Architecture aligns business strategy, business processes Domain Architecture and IT and provides governance to ensure business value and competitive advantage is delivered • Enterprise Architecture creates Project alignment, consistency and unity Architecture between objectives at various levels December 4, 2010 30
  • 31. Enterprise, Domain and Project Architectures Overall Business Enabling IT • Enterprise Architecture Strategy and Objectives Projects defines and manages overall organisation architecture Individual Business Enabling IT • Domain Architecture(s) Unit Objectives Projects are subsets of Enterprise Enterprise Architecture Architecture to enable individual business unit/domain objectives Domain and targets to be met Architecture • Project Architecture(s) enable project level Project objectives to be met Architecture December 4, 2010 31
  • 32. Enterprise Architecture Capability • The function that enables an organisation to create, adapt, enforce and develop enterprise architecture − Equally a part of the business as it is part of IT − Role is as much about controlling and focusing IT expenditure as it is about identifying necessary change • Ensures that the IT landscape is aligned to the business vision and continues to be aligned to the business strategy and operational needs • Ensures that IT solutions can continuously react to the changing needs of the business • Ensures that the business and financial case for change is made December 4, 2010 32
  • 33. Subsets of Overall Enterprise Architecture Business and Business Process Architecture Technology and Data and Infrastructure Information Architecture Architecture Application And Solution Architecture December 4, 2010 33
  • 34. Layers of Enterprise Architecture Overall Enterprise Architecture Context, Security, Governance Business and Data and Solutions and Technology and Business Process Information Applications Infrastructure Architecture Architecture Architecture Architecture Conceptual Overall Network View Defines Business and Information Application and What Is Shared Services Services Designs Infrastructure Required Design Logical Business Data Sources, Infrastructure View How Targets and Business Services and It Should Be Processes Flows Applications Components Implemented Designs Physical Application Technical Designs View Defines Business Database and Designs, and What Should Be Processes Message Designs Implemented Specifications Specifications December 4, 2010 34
  • 35. Enterprise Architecture Management • Enterprise Architecture needs be a guided strategy that is aligned with the needs of the business • Enterprise Architecture Capability enables an organisation to create, adapt, enforce, and develop its technical architecture • Enterprise Architecture Management provides a means to measure the effectiveness of Enterprise Architecture and assist organisations increase business value delivered by IT systems • Enterprise Architecture Management is a capacity rather than a programme or an end state architecture • Enterprise Architecture Management provides a capability model with maturity levels for an organisation to achieve desired level of Enterprise Architecture maturity and value • Enterprise Architecture Management provides a systematic coherent approach to defining, planning, and measuring an organisation's IT assets over time December 4, 2010 35
  • 36. Why Invest in Enterprise Architecture Enable Enable faster and easier Enable faster response Greater collaboration through to business changes and Business application and data new demands at lower Agility and Increased Flexibility integration cost Business Value IT projects will have a greater success – Solutions will be Increase Use delivered on time, on delivered at lower of IT budget and to user implementation and requirements – reducing operational costs cost through avoidance of rework Increased Success in Reduced IT Costs Solution Delivery Reduced IT Costs December 4, 2010 36
  • 37. Why Invest in Enterprise Architecture • Business cannot understand why relatively Solution Lifecycle Costs straightforward business changes are costly, risky and slow to implement • Run The Business improvements and Change The Business initiatives are restrained or prevented by the IT function because to the delay and high cost of implementing changes Post Solution Implementation • Lack of Enterprise Architecture means Implementation Costs – Support, operational and support costs of solutions are Costs Operation kept high − Reduces budget available to be used elsewhere • Situation worsened by projects attempting to deliver in an isolated fashion to bypass inhibitors resulting in further constraints for subsequent projects in the medium term December 4, 2010 37
  • 38. What Manage Enterprise Architecture Value? • Understand the current state of Enterprise Architecture − Create an accurate view of the current capabilities − Define the activities to be worked on in partnership with the business − Create a flexible Enterprise Architecture framework that will govern future initiatives • Validate Opportunities to Create Business Value − Define the initiatives that will create the most value − Define a realistic and achievable set of objectives − Define value measurement to justify commitment and investment • Develop a a Flexible Initiative and Project Portfolio − Define the set of initiatives and projects that achieve objectives − Positively vet programmes and projects for value − Create programmes of work that are justified, measured and managed for value • Recognise that Enterprise Architecture is strategic rather than tactical − Requires the participation in partnership of business and IT − Reach of Enterprise Architecture may extend beyond the organisation December 4, 2010 38
  • 39. Framework for Enterprise Architecture Management • Framework provides a means for assessing the Enterprise Architecture maturity level within an organisation • Can be used to achieve a target level of organisational Enterprise Architecture maturity and therefore value • Provides a means for continuously assessing and adjusting Enterprise Architecture efforts • Development of Enterprise Architecture needs be a focussed and managed strategy aligned with the business December 4, 2010 39
  • 40. Using Enterprise Architecture Management Framework • Define the scope and role of Enterprise Architecture and its management within your organisation • Understand your current capability maturity level • Systematically develop and manage key capabilities for effective and appropriate enterprise architecture management that adds business value • Evaluate and manage progress over time using a consistent set of value-oriented metrics December 4, 2010 40
  • 41. Using the Enterprise Architecture Management Framework Define the scope and role of Enterprise Measure and understand Architecture and its your current capability management within your maturity level organisation Systematically develop and manage key Evaluate and manage capabilities for effective progress over time using and appropriate a consistent set of value- enterprise architecture oriented metrics management that adds business value December 4, 2010 41
  • 42. Dimensions of Enterprise Architecture Management Framework Enterprise Architecture • Measure state of Practices Enterprise Architecture along three dimensions − Practices − Planning − People • Define facets of each Enterprise dimension Architecture Planning • Measure each facet in terms of: − Associated processes and their state of development − Scope or extent within the Enterprise organisation Architecture Personnel December 4, 2010 42
  • 43. Measurement of Value of Enterprise Architecture • Direct link between Enterprise Architecture and real value can be difficult to demonstrate • There is a time lag between implementation and results December 4, 2010 43
  • 44. Measurement of Value of Enterprise Architecture • Define Enterprise Architecture value measurement areas • Identify measurement process • Measure − Establish current baseline − Define target − Measure results against baseline and target December 4, 2010 44
  • 45. Measurement Framework for Enterprise Architecture Management Enterprise Architecture Management Framework EAM Dimension 1 - EAM Dimension 2 - EAM Dimension 3 - Enterprise Architecture Enterprise Architecture Enterprise Architecture Practices Planning Personnel 1.1 Architecture 3.1 Organisation 2.1 Strategic Planning Framework Structure and Skills 1.2 Architecture 3.2 Communication and 2.2 Architecture Planning Processes Stakeholder Management 1.3 Architecture Governance 1.4 Architecture Value December 4, 2010 45
  • 46. Measurement Framework for Enterprise Architecture Management Architecture Framework of standards, templates and specifications for organising Framework and presenting business and technical architecture components Architecture Methodology for defining, developing and maintaining architecture Enterprise Processes components Architecture Practices Architecture Principles, decision rights, rules and methods to drive architecture Governance development and alignment in the organisation Architecture Value Defining, measuring and communicating the value and impact of architecture to the business Strategic Planning Using architecture principles and blueprints to align business needs Enterprise with IT capabilities, define portfolio strategy and direction and allocate Architecture resources Planning Architecture Defining vision and roadmap for various IT domains by anticipating Planning business needs and trends, and developing architecture components Organisation Defining, planning, and managing roles, responsibilities and skills for Structure and Skills architecture management Enterprise Architecture Communication and Stakeholder Managing communication and expectations with business and IT Management stakeholders interested in or influenced by architecture management December 4, 2010 46
  • 47. Measurement Framework for Enterprise Architecture Management • Measure in terms of − Processes – those processes associated with Enterprise Architecture Management and their state of development – how well-defined and effective are the processes − Reach - scope or extent of Enterprise Architecture Management within the organisation – how widely used December 4, 2010 47
  • 48. Enterprise Architecture Management Assessment Framework Processes are Optimised, Flexible, Adaptable and Lean Processes are Managed and There is Continuous improvement Enterprise Processes are Architecture Repeatable and Processes Consistently Used Across Teams and Projects Basic Processes and Associated Collateral in Place Ad-Hoc Processes Defined and Driven by Individuals Across the Beyond the Within Organisation, Organisation Within an IT Across the IT Individual Including (Suppliers, Domain Function Projects Business and IT Partners, Functions Customers) December 4, 2010 Enterprise Architecture Reach 48
  • 49. Detailed Measurement Framework for Enterprise Architecture Management Enterprise Architecture Management Framework EAM Dimension 1 - EAM Dimension 2 - EAM Dimension 3 - Enterprise Architecture Enterprise Architecture Enterprise Architecture Practices Planning Personnel 1.1 Architecture 3.1 Organisation 2.1 Strategic Planning Framework Structure and Skills Processes Reach Processes Reach Processes Reach 3.2 Communication and 1.2 Architecture 2.2 Architecture Planning Stakeholder Processes Management Processes Reach Processes Reach Processes Reach 1.3 Architecture Governance Processes Reach 1.4 Architecture Value Processes Reach December 4, 2010 49
  • 50. Complete Measurement Framework Processes Enterprise • Three Architecture Planning dimensions x two aspects Processes Enterprise Architecture Personnel Reach Processes Reach Enterprise Architecture Reach Practices December 4, 2010 50
  • 51. Enterprise Architecture Management Maturity Level 1 Level 2 Level 3 Level 4 Level 5 Prioritization of project Architecture a key Business / IT planning Strategic Planning None Project-based portfolio based on input to joint enables efficiency, agility in roadmap Business / IT planning extended enterprise Limited vision and Architecture planning Continuous Includes extended Planning Architecture Planning Project-based roadmap process established improvement enterprise capabilities Project-based Central architecture Funded from efficiency Funding by margin on Funding by transaction Architecture Funding allocation fund gains services Limited framework - Covers Information and Consistently adopted Framework shared Architecture Framework None covers some process, but adoption not internally externally information consistent Defined processes Defined processes Defined processes with Project-based Defined processes Architecture Processes primarily focused on across business and IT clear ability to adapt and processes across IT domains infrastructure domains extend Practices Some review principles Shared governance Business / IT governance None / project- defined for some Defined IT governance Governance model with Business continuously improved to based components boards and processes and IT respond to change Defined and measured None / project- IT cost performance Business outcomes and IT Value and Measurement IT cost metrics business objectives, based metrics performance metrics performance metrics Organization Structure No roles, Formal technology Formalized roles and Clear professional Pro-active development and Skills responsibilities roles within projects responsibilities career track with external input People Pro-active Communication and Key stakeholders Regular consultation communication and Collaboration with Project-based Stakeholder Management identified and informed with business feedback with extended enterprise business December 4, 2010 51
  • 52. Assessing Current and Future Desired Architecture Management Maturity 1 - Ad-Hoc 2 - Defined 3 - Repeatable 4 - Managed 5 - Optimised Architecture Framework Architecture Enterprise Processes Architecture Practices Architecture Governance Architecture Value Strategic Enterprise Planning Architecture Planning Architecture Planning Organisation Structure and Enterprise Skills Architecture People Communication and Stakeholder Management Current EA Competency Maturity Level Desired Future EA Competency Maturity Level December 4, 2010 52
  • 53. Measuring Maturity and Importance 5.0 4.0 Level Organisation Structure Of and Skills Architecture Architecture 3.0 Processes Planning Maturity Communication Architecture and Stakeholder Value Management 2.0 Architecture Governance Architecture Strategic Framework Planning 1.0 1.0 2.0 3.0 4.0 5.0 Level of Importance December 4, 2010 53
  • 54. Benefits of Increasing Enterprise Architecture Management Maturity • Measuring the true impact of increasing Enterprise Architecture Management maturity is hard to achieve • IT architecture simplification can be one of the largest contributors tor IT cost reduction (in the range of 5%-18%) but it has a long lead time - up to 2 years December 4, 2010 54
  • 55. Outcomes of Effective Enterprise Architecture Management Modeling Information Relationships and Standardising Lifecycles Information Elements Deploying Integration Shared Between Systems Infrastructure Standardising Hardware Specifying Application and Core Software Architecture Platforms Requirements Building Reusable Defining Architecture Application Components Methodology Reduced Costs & Service Improvements December 4, 2010 55
  • 56. Impact of Effective Enterprise Architecture Management Can Be Difficult to Quantify Primary/ Immediate Secondary/ Medium- Tertiary/ Long-Term Benefits Term Benefits Benefits Lower integration costs (and Improved responsiveness to business Rationalised application portfolio corresponding project costs) needs Shorter integration time (and Integrated infrastructure and Better IT and business decisions corresponding project time application management Increased hardware utilisation Renegotiation/consolidation of supplier and deferred or eliminated Higher IT productivity contracts hardware spend Simplified development Better information quality Reduced operational risk Improved operational efficiency and Simplified analysis and testing Faster access to information effectiveness Eliminated or reduced spend on Higher application development redundant application purchase Sustained cost reductions productivity and development Leverage new capabilities Increase flexibility within the business Lower capital spend for competitive advantage and IT December 4, 2010 56
  • 57. Impact of Effective Enterprise Architecture Management Can Be Difficult to Quantify Primary/ Secondary/ Tertiary/ Immediate Medium-Term Long-Term Benefits Benefits Benefits Scope and Benefits of Enterprise Architecture Over Time Directly Difficult to Quantifiable Define Intangible Ease of Measuring Benefits of Enterprise Architecture December 4, 2010 57
  • 58. Measuring Quantitive and Qualitative Value from Enterprise Architecture Measures of Value from Enterprise Architecture Quantitive Measures of Qualitative Measures Value of Value Reduced Project Risk Reduction in project time and cost Improved Business Reductions in faults and overspend over-runs both without scope or and Complexity Requirements Delivery due to incorrect requirements quality reduction Improved Project Solution quality, delivery on-time Better Alignment with Quality-related feedback from the and within budget and to user Success Business business through regular surveys satisfaction Cost Control and Measure through feedback where Measuring return on projects over Increased Agility and IT is viewed as an partner and Improved Return on lifetime enabler with the business and not Competitiveness Investment just a cost and constraint Reduced Costs for Measure through effect with the Complete operational costs of IT to Improved Business business becoming better Business As Usual reflect the total cost of ownership connected and greater reach of Knowledge Operations processes Enable Delivery of IT Sustained delivery of the IT Strategy which should also be Strategy concerned with delivering value December 4, 2010 58
  • 59. Focussing on Areas of Low Maturity and High Importance Fourth Areas To Focus Second Areas To Focus High On To Generate On To Generate Maturity Improvements Improvements Maturity Low Third Areas To Focus On First Areas To Focus On Maturity To Generate To Generate Improvements Improvements Low View of Importance High View of Importance Importance December 4, 2010 59
  • 60. Focussing on Areas of Low Maturity and High Importance • Use Enterprise Architecture measurement framework to identify areas of greatest return on investment December 4, 2010 60
  • 61. Enterprise Architecture Value Measurement Programme Feedback on Measurement Framework Plan Enterprise Define Measure Analyse Architecture Enterprise Enterprise Enterprise Implementation Execute Architecture Architecture Architecture /Enhancement Programme Measurement Value Value Measures Programme of Framework Work Measure Delivery and Results • Does the Enterprise Architecture programme have a measurable impact on the IT investment portfolio? • Does the Enterprise Architecture programme lead to measurable improvements of performance? • Is there a clear relationship between Enterprise Architecture programme and business services? • Does the Enterprise Architecture programme result in measurable cost savings/avoidance? December 4, 2010 61
  • 62. Summary • Appropriate Enterprise Architecture can deliver significant business benefits • Comprehensive Enterprise Architecture value measurement framework is needed to link Enterprise Architecture to business benefits December 4, 2010 62
  • 63. More Information Alan McSweeney alan@alanmcsweeney.com December 4, 2010 63