Enterprise Architecture

Any building to survive big storms needs to have a good building foundation. The same is for any business that wants to survive any economy or competitor's challenges - there should be a good foundation for execution. Companies might have a great strategy in mind but don't have a good foundation. Then a strategy execution becomes a struggle. "A foundation for execution is the IT infrastructure and digitized business processes automating a company's core capabilities". Core capabilities are created by core business processes that company should own and do not outsource. Having a great foundation for execution increases company's agility, improves business discipline, creates business value.

One of the first steps in building the effective foundations for execution is to define an operating model, which will provide the best support for the company's strategy. Integrations and standardization are the two dimensions of the operating model. There are different types of operating models:
1. Diversification
2. Coordination
3. Replication
4. Unification

The choice of the operating model will drive the autonomy level of the business units. Each operating model provides a different way for the business growth; organic growth through expansion of the business or growth through a rip-and-replace approach for acquisition. Depends on the company, business units can apply different operating models to their activities to meet business objectives and satisfy the market reality.

To build a core diagram for an operating model existing templates can be used. The design of the enterprise architecture in many companies is done by IT, but instead it should starts from the senior management. Choosing an operating model by senior managers forces a decision on a general vision. Identifying the key customer types, core processes, shared data and technologies to be standardized and integrated demands a commitment to a particular course of action.

Benefits of Enterprise Architecture: EA maps out important processes, data, and technology enabling desired level of integration and standardization. Each stage of the EA maturity provides a new or expanded technology and business benefits.

Managements practices for realizing value from architecture it maturity: it formalizes organizational learning about how to leverage IT capabilities and adopt business process changes, defines formal roles, and managerial processes.

The evolving role of the CIO: CIO is the key driver of enterprise architecture benefits. As the company’s architecture matures, the CIO role evolves.

IT engagement model is a system of governance mechanisms assuring that business and IT projects achieve both local and company wide objectives. It has 3 ingredients:
- Company wide IT governance
- Project management
- Linking mechanisms
IT governance is about decision rights and accountability framework for encouraging desirable behavior in the use of IT. There are five major decision areas:
IT principles
Enterprise architecture
Business application needs
Prioritization
Investment

Project management is about adopting standardized project methodologies. Disciplined project management processes are a necessary condition for good engagement.

Good linking mechanisms ensure that projects incrementally build the company’s foundation and that the design of the company’s foundation is informed by projects.

It is essential to learn that there are 3 types of outsourcing: standard partnership, cosourcing,and transaction. Applying the outsourcing help companies build their foundation for execution.
The benefits of outsourcing capitalize when the right type of outsourcing is implemented to the appropriate stage of the enterprise architecture maturity. Clients and vendors in strategic partnership who refuse to adapt to the strategic needs of their partners will become embroiled in bitter contract battles. Companies managing transaction relationship like strategic partnership incur expensive and unnecessary overhead. Cousourcing that is treated like anything but a team environment is sure to sub-optimize outcomes.

Leveraging the foundation for execution for profitable growth for companies in different stages of development of enterprise architecture makes possible the future of the architecture evolution to 5th stage. The approaches for the acquisition strategies should be done by analyzing the 2 companies architectural stages and prognoses the outcome of different combination. A company’s agility increases through moving their foundation through the different stages of architectural maturity and a company’s operating model dictates the way to architecture maturity evolution.


It is possible to identify the symptoms of an ineffective foundation for execution. Using the key steps in rethinking the foundation of execution and applying the top ten leadership principles can fix the ineffective foundation for execution. While building a healthy foundation for execution it is important to understand the future value of enterprise architecture implementation in regards of customers and competitors demand, regulations, markets changes, and business processes industry-standardization.

Resource: Jeanne W. Ross, Peter Weill, David C. Robertson. Enterprise Architecture as Strategy