Well known psychologist Abraham Maslow suggested that humans have a “hierarchy” of needs. These start with basics like food and water, move up through needs such as safety and at the top level include morality and creativity.
In our work with more than 300 Global 2000 and Federal customers, we’ve seen them implement business architectures with a similar “maturity model” perspective. This involves a sustainable, high-value enterprise architecture program that includes business architecture every step of the way. As the customer’s sophistication increases, the program evolves from being focused (at the lower levels) on creating an IT portfolio that is aligned to the business to (at the highest level) improving the overall business. Rather than a one-time effort, the business architecture program delivers ever-increasing value, starting with whatever level in the hierarchy the customer is ready for.
The first, foundational process is “Improving the IT Portfolios.” Here you establish sustainable plans and standard governance processes for your IT portfolios. The key here is embracing the concept of the business capabilities that are enabled by each portfolio, which you can use as taxonomy to describe these portfolios. The business capability maps produced by your EA tool can help describe the IT portfolios, and to communicate their benefits, costs, risks and plans to the business.
In Level Two, you use these capability maps to begin lowering the risk and improving the delivery times for IT processes. Using the understanding of the IT portfolio from Level One, you can work with the business to reduce risk, improve adherence to schedules and deliver better service. This is particularly important when project teams are creating new solutions for the business. In many cases we see those teams being guided for frameworks such as TOGAF that very explicitly calls out the business architecture efforts in the the TOGAF Architecture Development Methodology (ADM)
If Layer Two was about “doing things right,” Layer Three –“Improving Business/IT Alignment” — is about determining what are the “right things” to do. Based on your understanding of the IT portfolio and the business from the previous layers, you help the business understand how investments contribute to goals, strategies and objectives, and to the IT portfolio. This enables stakeholders to make “fact-based” decisions about which areas should be funded, rather than reacting to the squeakiest wheel. The often vague term “business/IT alignment” delivers solid benefits here by steering investments to where they will deliver the highest return.
For example, you might use a capability investment analysis to show which high-return capabilities are receiving very little funding, or no funding, versus other activities that are over-funded. Or you might use a goals road map to show which of your key goals are dependent on aging technology. Each identifies investment gaps, and what the enterprise can do to improve business/IT alignment.
In the fourth layer, “Improving Business Performance,” you can use benchmarks from organizations such as APQC to determine where the business could benefit from process improvements. A useful artifact here might be a capability map highlighting which processes are underperforming, and how they align to the business.
The fifth layer, “Improving the Business Model”, is the highest and best use of a business architecture. It’s one few organizations consistently reach, but is something we should all aspire to. It involves the transformation of systems and business models, is based on a deep understanding of goals, strategies and plans and requires active C-level support. It makes use of artifacts such as strategy maps, balanced scorecards and capability road maps to deliver fundamentally greater business value.
One example is the CEO of a European bank leading an initiative to align IT investments to business strategies so the bank can better respond to changing market conditions. The bank used Troux to create a business change dashboard displaying, among other things, the relationship of the bank’s capabilities and processes to its goals and strategies. At another firm, a global insurer, the CSO led a program to establish an authoritative source for goals and strategies, leveraging executive-level visualizations to aid planning process.
Through our years helping customers achieve success at all levels of this hierarchy, we’ve learned some important lessons. They are:
- Speak the language of the business, not of enterprise architecture.
- Start your EA work on the most pressing business issues, such as a merger or acquisition, time to market issues, or regulatory compliance.
- Create sustainable EA processes that can deliver lasting value. This requires executive sponsorship, clarity around roles and agreed-upon governance and measurement of your program.
- Create value and communicate your success, and
- Never, ever, show an EA model to an executive. Again, you have to speak the language of the business, not expect them to speak yours.
That’s a brief overview of our tips for scaling the EA “hierarchy.” For more information we invite you to watch a replay of Bill Cason’s webinar on that topic.
