Search Results for: business model

Why should anyone do enterprise-architecture?

by

A nice quick one this time! I came across this tweet today from business-model guru Alex Osterwalder: business_design: A business model’s performance is due more to the harmonious relationships among its elements than to the elements themselves I tend to describe a core driver for enterprise-architecture and the like as one very simple idea: things […]

The Service Oriented Enterprise

by

It’s now fourteen years since CBDI was formed. In the early days our mission was, as a think tank, to evangelize new ideas of modularity, separation, contract based and service orientation.

We had a vision then; it was the enterprise, every enterprise, as a set of services deployed in a cloud.

Of course over the years we have become immersed in the details of best practice, education, and assisting larger enterprises to leverage and realize the SOA concepts. But the vision is still there.

It was around 2005 that we first started thinking about capability as a formal concept. The first report on the subject was in June 2006, and at that time the CBDIers started a long running debate (well argument actually) about this concept. There were two primary issues. First, should a capability be standalone or could it be an integral part of a broader application and technology infrastructure. In the end we couldn’t agree and we compromised in identifying capabilities as standalone or not standalone. I will admit I was in the first camp, and remain there today.

The second issue was should organizations be planning for the entire enterprise to be comprised of capabilities. To be honest this issue received less attention and in the end we never published advice on this. Perhaps it was just too early. Also in those early days there was confusion over capabilities. Was a capability part of a business process, or did the capability subsume the business process? Well of course these questions have long been resolved with experience.

But whilst the capability concept is now widely understood, I wonder how many enterprises have actually taken it to the logical conclusion and organized (their SOA and indeed the business) around them? I see many pretty capability maps, but fewer capability services.

The reason I am returning to this subject is because many organizations are now rebooting their SOA initiative and they should be looking at capability services as the foundation of their architecture. Why?

1. Business capabilities represent a common perspective shared by business design and service implementation.

2. Properly structured capabilities are completely independent (see above) and facilitate change with the minimum horizon of impact. They also support practical analysis and classification of services as core or context which facilitates the sourcing decisions.

3. Looking at how the world works today, the primary strategy must be around ecosystem collaboration. Choose what capabilities are core to your enterprise and specialize in them. Organize around them. Conversely identify the context capabilities and figure out what collaborations will be most complementary and go make partnerships, or offshore or outsource or rent from the Cloud.

4. Plan to implement the entire core of the enterprise as a set of strategic capabilities that are smart, autonomic, and talk directly to the real “end user”. Eliminate all other process interventions and optimize the core capabilities using the very latest technology. Architect and engineer the capabilities to be capable of continuous evolution.

5. Stop talking about SOA, start talking about the Service Oriented Enterprise. It’s a business issue.

We have dedicated this October 2011 edition of the CBDI Journal to this topic. We advise that business design should be synonymous with capability design. In my report on Business Design for the Service Oriented Enterprise, I explore a series of patterns for the smart, continuously evolving, virtual enterprise. I discuss the convergence of ecosystem automation and autonomics, architecture for continuously evolving business, together with the merger of consumer and business IT and how these will have a profound impact on conventional business models, which will in turn affect business modeling techniques and enterprise architecture. In addition we have in depth reports on Capability, Planning and Analysis.

CBDI Journal October 2011

Business Design for the Service Oriented Enterprise

Capability Planning and Analysis


A week in Tweets: 04-10 September 2011

by

And, for once, not overly late… Another week’s collection of Tweets and links, always the same(ish) structure, always different content. Enterprise-architecture and the kind of big-picture stuff that business will need: tetradian: [post] EA metamodel and method http://bit.ly/q2Qc5R #entarch (thx @ArtBourbon @pbmobi @adraffin @Robert_Phipps) gkathan: RT @jukkaam: Finding Opportunities in Business Model Innovation: business model […]

Will Your Organisation Need a CIO by 2020?

by
The title of my new blog post is provocative. Why would I ask such a question, especially after covering number of CIO surveys, trends, leading CIO thought leaders and underlining the strategic importance of IT in this very blog? I am asking this question because the IT Landscape as you and I know it, is changing and very fast.  Even by IT industry standards the pace of recent developments is remarkable. The business technology is undergoing rapid evolution. And the central argument which I am presenting here is that the conventional role of CIO or CIO function as it stands today will either be ineffective, redundant or out-dated and hence not required by end of this decade. Let me explain…

There are a number of reasons and drivers for the rapid evolution of business technology. However according to me there are five major forces which are influencing this evolution. They are Business Services, Application Services, Business Analytics, Consumerisation of IT and Cloud Computing. I will try to explain them briefly  

image

Rise of Business Services – Awareness of the fact that, “Organisations purchase technology to fulfil business needs” is growing like never before. Given economic challenges very few organisations can now justify technology investment for pure technology advantages. Your CEO, COO, CXO and CFO will be demanding “Return on Investment” (ROI) and “Value for Money” (VFM) from each technology $ invested and they will be demanding that most likely in year one. Days of five or even three year technology pay-back are certainly behind us. And this is where purchasing business services independent of large technology investment is becoming so attractive. There are a number of examples of this trend ranging from payment processing to HR processing. Google is taking business services to new dimensions.
 

A test question for you – If you are CEO of a mid-size organisation would you invest $5 Million in back office processing software, hardware, network, back-up, security etc.? Or would you sign up for business outcome based contract with niche business services supplier? I know your answer and mine is the same!
 
Maturing Cloud Computing Industry – Enough is written about benefits of Cloud Computing (including this blog) so I won’t repeat it. However it is safe to conclude that Cloud is more than hype. It is real and there is an entire industry being built around Cloud propositions by all major IT vendors as well as rising number of niche players. Cloud computing if adopted in right manner frees your organisation from capital intensive infrastructure and operations investments. The business justification will not be far different than arguments which I have listed above. Cloud computing however gives organisations added flexibility of building solutions to suit their requirements yet allows them to offload its capital and resource intensive aspects to infrastructure specialists. It can be easily argued that business services are a variant of cloud computing. 
Another test question for you – You are a CFO of retail chain and you have a legacy retail management application. Your peak business transactions are expected only in the months of March, September and December but for all other months you operate at half the transactions of peak. Would you like to scale up and down the capacity and hence the cost of your retail application operations? I know your answer and mine is the same!
 
Business Analytics Coming of Age – A large number of small niche companies and even large companies like IBM and Oracle are investing millions of $ in developing and enhancing business analytics products and services and they are doing this for a very good reason. People like you and me (and multiply that number by millions of Indians and Chinese) are adapting to self-service shopping lifestyle. When was the last time you went into your bank branch? Or when was the last time you bought a book in a book shop? When was the last time you called your airline or visited its city booking office to purchase your airline tickets? I know your answer….we are more and more relying on smart, intuitive ecommerce sites, price comparison sites, shopping portals, kiosks, ATMs, etc. to buy everyday and occasional things of need and desire. The merchants are looking for smarter ways to know you, your preferences, your wish lists and keep your loyalty. This is true for brick and mortar businesses too by the way. And smart merchants are turning to business analytics to make more sense of their business transactions, shopping patterns, supplier dependencies, seasonality and thousands of other trends which affect their business. 

Another test question for you – if you are a mid-size or small company COO running a brick and mortar plus an ecommerce portal for your business would you rely on your in-house MI experts to keep up with 1000s of changing patterns, equations, behaviours and trends? Or would you secure an external niche business analytics company to analyse tons of your business transactions, do the number crunching and present predictions for next quarter along with benchmarks? I know your answer and mine is not too different! 
 
Popularity of Application Services – This may be very specific development but worth making a note of. You may recollect my earlier blog on ASOS and how smartly they are leveraging open access to their applications of catalogues. Apple App Store is another example of this model. These smart technology and business models are making middleware software, hardware and tools almost redundant by giving core access to application tier of your business systems. You suppliers and partners deliver direct to your application and data tier, why bother with message brokering? See my proposed revised retail reference architecture and you will know what I mean. 

Let me not ask you a question but pass you my verdict on this one – No I don’t need an internal IT department to develop interface to launch my catalogue on Apple App Store. I will go to a niche small firm who will do it for me at fraction of cost to much better response times than internal development and test department. 
 
Spread of Technology Consumerisation – Again enough is said about Apple ipad, Amazon Kindle, and Android smart-phones. The fact is if you are reading this you have either all of minimum one of them. And I know that you will prefer to carry your own ipad to work and do your office email, documents as well look for best place for Thurs after-work drinks on Google map on one of those boring conference calls. And if you organisation is not funding your smart-phone then you do not mind getting on an attractive tariff to join swelling ranks of smart mobile workers of next generation. I am not even mentioning Google Docs, Microsoft Office 365 and other similar offerings which liberate corporate IT. 

You know where I am going next – If your data privacy and security concerns were addressed would you mind if your employees brought their own IT equipment to work? I would not if I am a CFO of a business which made loss of double digit last year and who do not understand why I pay three times for a desk top compared to retail cost of ipad!
 
To summarise my argument – given these very influential forces which are shaping the world of business technology and the fact that they are here and will be growing in their influence….and their strong commercial as well as functional advantages; how long before your conventional CIO function turns into out-dated, ineffective and irrelevant cost centre? If the trajectory of this evolution continues like this, will your organisation need a CIO by 2020? I know your answer and mine is very similar!

Assets and Resources

by

More on translating Business Model Canvas to Archimate etc. (Yes, it’s another of those long, interminable technical posts – my apologies, though they are necessary…)
This one picks up on a couple of sort-of-mistakes that I’ve made in the previous post, ‘Questions on business-model to enterprise-architecture‘, and which need a bit more clarity in explanation. In […]

Rethinking the layers in enterprise-architecture

by

Still plodding away on ideas for a systematic process to translate a business-model in Business Model Canvas down into real-world architecture and implementation. (This links up with quite a few previous posts, such as ‘More on business-models‘, ‘Enterprise-architecture – let’s keep it simple‘ and ‘Is Archimate too IT-centric for enterprise-architecture?‘)
[Note: this is a work-in-progress post, […]

How Innovative Retail Architecture is Boosting Profits at ASOS

by

Outstanding and outperforming businesses often challenge conventional industry architectures. Such organisations innovate and develop new business models on their way to above-average profits. The online fashion giant ASOS (as seen on screen) has exact…

How Innovative Retail Architecture is Boosting Profits at ASOS

by
Outstanding and outperforming businesses often challenge conventional industry architectures. Such organisations innovate and develop new business models on their way to above-average profits. The online fashion giant ASOS (as seen on screen) has exactly done this. In one of firsts of the industry, ASOS intends to make free global shipping a “permanent” part of its business model after international sales growth fuelled a 63 per cent jump in sales in the first quarter to £107m. International sales grew 160 per cent to £59.6m in the three months to June 30, and now make up 57 per cent of overall sales. Singapore, Russia and Australia are among the fastest-growing markets. This is impressive compared to UK high street bellwether Marks & Spencer which narrowly beat City expectations recently by declaring a 13% increase in profits in its last financial year. But ASOS business performance looks blockbuster when it is compared to other retail results. For instance the gravity of the high street downturn is spelled out in new research which shows UK retail chains have been closing stores this year at a rate of about 20 a day. The latest figures from accountancy firm PricewaterhouseCoopers show 375 retailers went bust in the second quarter of 2011, a 9% increase on the same period last year. 

So what makes ASOS special? ASOS targets internet-savvy 16 to 34-year-old women looking to emulate the designer looks of celebrities such as Kate Moss, Sienna Miller and Alexa Chung, but at a fraction of the price. While many retailers have struggled against tough macro headwinds, ASOS has prospered, benefiting from a young core customer base and the migration of spending from the high street to the Internet. The firm has a Facebook store and mobile applications. “This is about the shopping experience coming to you. That could be via apps, on your mobile, on Facebook,” said the CEO. “This is the next shift in terms of how we perceive shopping online. Rather than websites that you go to I think it becomes much more part of your personalised web experience.” Compare and contrast this with the fact that, despite huge outlays in the past, the new Marks & Spencer boss is to spend an extra £600m on its UK chain. 

But the unsung hero behind ASOS flight according to me is the innovation which ASOS IT department is bringing to the business. ASOS has crashed the conventional retail reference architecture and brought innovation leveraging the technology advances such as Cloud Computing, Social Media and Consumer Devices. For instance ASOS is assessing how Microsoft’s Azure cloud service could be used to expose mobile data application programming interfaces, which would enable it to extend its reach through mash-ups. Daniel West, IT director, ASOS, has established an IT strategy to build for the cloud first, rather than on-premise. “We look at the cloud first and build if nothing is available.” Daniel West said: “My technology design is to support our international growth. So we need to look at delivery through the cloud.”

image
Innovative Retail Reference Architecture (Revised V2)

See my revised Retail Reference Architecture above which reflects ASOS innovation. (Ref: The original Retail Reference Architecture). The ASOS APIs which power the mash-ups empowers young ASOS customers to bypass traditional Retail Touch Points and Work-flows and access the ASOS catalogue directly. It has merged social networking and shopping by launching the first European fully integrated Facebook Store. ASOS customers are able to buy, save, share and comment on items without needing to leave the social networking site to obtain full e-commerce functionality.

ASOS successfully demonstrate that Industry Reference Architectures are a sound and solid foundation but they are not sacred and should be chopped, changed and innovated to bring dynamic benefits to the business. I am not claiming that innovative Retail Architecture is the only reason behind ASOS success. Smart branding, clear customer segmentation, effective supply-chain and visionary leadership have clearly contributed to ASOS success. However, the contributions from ASOS IT team can not be underestimated in the analysis of ASOS success.

Ten Topics a Venture Capitalist Cares About

by
Venture-capital-failure-rates

According to Guy Kawasaki The ten topics that a venture capitalist cares about are:1. Problem
2. Your solution
3. Business model
4. Underlying magic/technology
5. Marketing and sales
6. Competition
7. Team
8. Projections and milestones
9. Status and timeline
10. Summary and call to action

[Image courtesy of FreeDigitalPhotos.net]

Posted via email from Jeffrey Blake – The Brand Hammer | Comment »

Ten Topics a Venture Capitalist Cares About

by

According to Guy Kawasaki The ten topics that a venture capitalist cares about are:1. Problem2. Your solution3. Business model4. Underlying magic/technology5. Marketing and sales6. Competition7. Team8. Projections and milestones9. Status and…

Categories Uncategorized

Who is the customer?

by

Who is the customer, in a business model?
That’s perhaps not as simple as it sounds. I’ve been working on a long how-to post on using Business Model Canvas in a non-profit context, and realised that even in a commercial context it can get very messy once we move outside of the relatively simple ‘world’ that […]