Whitepaper written by Daniel Lambert

Most well-known and traditional businesses are deploying digital technologies on the cloud, using the Internet of things and mobile applications. More and more are testing and starting to deploy artificial intelligence within their operations. However, just a few of these established companies have been designed for digital from the beginning.

Too many of the innovative projects initiated by traditional organizations fail to deliver meaningful business outcomes in a reasonable time frame. According to the Boston Consulting Group, “75% of transformation efforts fall short of their targets in terms of value generated, timing, or both[1].” Rapid and continuous innovative changes and more informed and fewer loyal customers are pressing businesses to have more fluid business strategies. Time to execution is now shorter and needs that most traditional companies become much more agile and learn to rely less on a siloed-organizational structure to carry out their plan. Capital and resources need to be reallocated to customer-driven initiatives and projects, over other types of projects.

Enterprises need to get better at designing, architecting, prioritizing, and delivering their corporate future successfully[2]. An organization needs much more than technology if it wants to strive in today’s economy. Investing most of your resources strictly in technology is a recipe for failure. Your implementation of technology needs to blend into your corporate ecosystem using the entire spectrum of business architecture. As shown in Figure 1 above, to increase the odds of success of your business transformation, you need to make sure that you have executive sponsorship, enterprise and business architects, an efficient governance, a more customer-driven approach, coherent strategies & goals, valuable and useful data, capability-based roadmaps, business outcomes for each one of your projects, change management, and in general an agile mindset.

Executive Sponsorship

The business transformation through innovation and technology can only succeed with executive sponsorship. This article entitled “Agile Transformation Management: Managing Large-Scale Change in a Fast-Changing World”[3] explains very well the three common root causes for the frequent failure of large business transformation initiatives to deliver on their promises.

First, the leaders of each business transformation initiative or portfolio lack transparency between each other. They do not have a broad view of the vision and strategies of their organization and are unable to prioritize between all their initiatives and sub-initiatives those that really matter and those that can wait. They end up having too many programs and projects for the resources allocated to them.

Second, traditional transformation management methods drive programs into long delivery cycles and make it impossible to keep up with agile ways of working. Inflexible multi-year detailed milestones and dependencies planning determined early-stage programs are not adequate for agile companies. Very often, the targeted end-state of digital transformation endeavors needs to shift repeatedly during the delivery and execution of an agile customer-driven enterprise.

Third, high management sponsoring digital transformation initiatives get too often disengaged with time and tend to delegate their key responsibilities to their program/project manager, who should be responsible for planning, alignment, and problem resolution, but usually lacks a deep understanding of the always evolving strategies of the organization.

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This is why most organizations serious about their business transformation will have some kind of strategic business transformation governance committee reporting to the COO of the organization, as shown in Figure 2 above. Ideally, business and enterprise architects should be involved in this committee as core participants. They should work with other core participants, like change managers, strategy experts, etc.

Depending on the examined initiatives, virtual participants should also be involved. Business stakeholders from different business units should be among virtual participants, like subject matter experts, product managers, and marketers. The architect team reporting to the CIO should also be involved as virtual participants, like EAs, application architects, data architects, for example, depending on the examined initiative.[4]

Business Architects

To disseminate the high-end goals and strategies of a business transformation of an organization everywhere horizontally and vertically in an organization and to avoid siloes, a strategic business transformation governance committee includes enterprise and business architects. According to the Business Architecture Guild, “Business architecture allows everyone - from strategic planning teams through implementation teams - to get "on the same page", enabling them to address challenges and meet business objectives.”[5]

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In an agile enterprise, enterprise architects should cooperate with many different types of collaborators during the planning, architecture, and delivery of digital transformation initiatives. As shown in Figure 3 above, five steps describe how strategy execution can be accomplished using enterprise architecture. These steps include 1- business design and strategy, 2- architecting transformation, 3- initiative planning, 4- agile delivery and execution, and 5- success measurement. For each of these steps, enterprise architects will need to co-operate with different types of internal and external collaborators.

Customer-Driven

Business Transformation should allow an organization to become more customer-driven. Disruptions are occurring at a quicker pace than ever, where the most rigorous organizations have no choice but to transform rapidly from a seller-driven enterprise model or a customer-centric enterprise to a customer-driven enterprise providing customer lifetime value as shown in Figure 4 below. Enabling Customer-driven Innovations Using Business Architecture, “requires more predictive insight data analysis, interactive & proactive services, individualized customer understanding using personas, inter-enterprise bundles between business units and departments, integrated and seamless channels, and the elimination of all functional organizational silos to become a customer outcome organization[6].”

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Business Design and Strategies

Enterprise and business architects are often asked to prioritize initiatives and projects. To complete this task, they need their organization’s strategies, goals, tactics, and objectives. Too often, these can be very difficult to gather either because architects have never been aware that they existed or sometimes because they simply and plainly don’t exist. To extrapolate these strategies and objectives, numerous business models are being used for business design, as shown in figure 4 below. Balanced Scorecards, Value Chain, Hoshin Kanri, Business Model Canvas, and the Business Motivation Model are very useful to describe and understand an organization at the corporate and business levels. The Business Model Canvas, and the Business Motivation Model as well as the Design Thinking, the Customer Journey Map and the simple SWOT Analysis can be very useful at the product and marketing level. As for the Design Thinking framework, the Customer Journey Map approach, and SWOT Analysis, they are ordinarily used at the initiative or project level. More about this subject is available in this article, entitled “Business Design and Architecture”[7].

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Valuable Data

Data is everywhere and becoming more and more valuable. “There were about 21.6 billion devices (phones, cameras, and sensors) of all types connected to the Internet in 2020. This was about 2.6 devices per person worldwide. This number should grow to 5.0 devices per person by 2025. In terms of data, the numbers are astronomical. In 2020, 64.2ZB of data was created or replicated worldwide, according to IDC. This is 3.2 TB of data per connected device per year or 8.2 TB per person per year. In a day, it represents 22.5 GB of created and replicated data per person for 2020; this number should grow to over 60 GB per person per day by 2025. In comparison, one hour of standard video streaming on Netflix is 1 GB.” No wonder a growing quantity of corporate resources is assigned to managing, planning, and architecting data, hence the importance of modern data architecture.[8]

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Organizations are not limiting themselves to static IT-driven data architectures anymore, called data warehouses. They take too many resources to implement and change. Today’s data architecture needs to be ready for speed, flexibility, and innovation. The key to a successful data architecture upgrade is agility. As shown in Figure 1 above, modern data architecture may still include a data warehouse and data marts, but they need to be more flexible, adaptable, and agile. The use will be limited in generating reports, dashboards, diagrams, smart applications that are viewed by only a few casual users for analysis.

Capability-Based Roadmaps

To become a more customer-driven enterprise, organizations must build their innovation roadmaps based on business capabilities, which are the most reliable and stable bridge between business and IT, as shown in Figure 7 below. According to TOGAF® and BIZBOK®, a capability is “A capability or a business capability is an ability that an organization may have or exchange to achieve a specific purpose or outcome.”[9] A business capability will be used by one of several business units, departments, etc. A business capability should be owned by only one business unit or department. A business capability will also be supported by one or many applications and/or systems. Traditionally, business and enterprise architects have measured the maturity of a capability. Personally, I find it more practical to measure the 1) performance, 2) priority, and 3) business complexity of a capability. You may find that a non-performing capability is lacking a proper software application, but it will usually not be limited to this. A non-performing capability will usually also lack trained human resources, proper business processes, and/or alignment with the corporate strategies.

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Business Outcomes

Most if not all your initiatives and projects should be derived from capability-based roadmaps. Laying out the nomenclature and GANTT Chart of your initiatives and projects into sub-initiatives and sub-projects needs to include a business outcome derived at minimum from strategies and tactics. At best a business outcome should be derived from goals and objectives, as shown in Figure 8 below.

Strategies consist of high–level plan items that also include short period tactics to achieve an organization’s significant goals under conditions of uncertainty. A goal is a desired result that an organization envisions, plans, and commits to accomplishing within a finite timeframe. As for objectives, they are essentially short period goals whose achievement brings an organization closer to its long-term goals. Goals are drawn from strategies. As for objectives are derived from tactics, which are conceptual short period actions to deliver and execute a strategy.

If goals and objectives are nowhere to be found in the organization, the business and enterprise architecture team should try to extract them from management. In reality, many business and enterprise architects often must fall back on imprecise strategies and tactics because of the reluctance of some managers to commit to precise goals and objectives.

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Change Management

Enterprise and business architects often work hand-in-hand with change managers in the planning of business transformation. Change Management is a proven business-oriented discipline that is very complementary to business architecture. Change Management is an approach to prepare, support, and help individuals and organizations in making organizational change. As shown in figure 9 below, at the organizational level, change management is about preparing for change, managing for change, and reinforcing change. Both for business architecture and change management, drivers of change may include the ongoing evolution of technology, internal reviews of processes, crisis response, customer demand changes, competitive pressure, acquisitions and mergers, and organizational restructuring, as explained in detail in a webinar entitled “Boosting Organizational Change Management with Business Architecture”[10]. The key difference between a business architect and a change manager is that an enterprise architect was often in his previous life an IT-oriented architect, an ex-business analyst, in brief someone that can talk to both business managers and IT stakeholders. As for change managers, they have usually a business management background. They know extremely well how to exchange with business stakeholders, in particular senior ones.

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Agile Mindset

Agile organizations are becoming more common because of the increased appreciation for their transformational gains. With this movement, we are assisting at the emergence of a new breed of enterprise architects that are becoming instrumental in making their corporation more agile. It requires a major culture shift where enterprise architects need to collaborate frequently with different stakeholders within their organization.

Too many enterprise architects are still limiting themselves to writing hermetic "Solution Architecture Definition Documents" and hiding from the real action. Yet, we're seeing a new trend picking up. As indicated in this article entitled “The Enterprise Architect’s Ecosystem in an Agile Enterprise”[11], more and more business and enterprise architecture teams are participating and blending into their organization's business prioritization strategic planning, portfolio management, roadmap optimization, product management, customer-centric initiatives, agile project fine-tuning, newer and more modern business-oriented KPI definitions, etc. In brief, we are assisting at the emergence of a new breed of enterprise architects, that are becoming very instrumental in making their corporation more agile.

In brief, to strive with their business transformation, organizations have got to stop allocating most of their resources into technology. Investing most of your resources strictly in technology is a recipe for failure. Successful innovation implementation is rarely attainable without executive sponsorship, enterprise and business architects, efficient governance, a more customer-driven approach, coherent strategies & goals, valuable and useful data, capability-based roadmaps, business outcomes for each one of an organization’s projects, change management, and in general an agile mindset.

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[1] Quote from this article entitled “How to Get Agile Right” published on the Boston Consulting Group website.
[2] To learn more, you may want to read this book written by Daniel Lambert entitled “designing, architecting, prioritizing, and delivering their corporate future successfully” published on February 18, 2020.
[3] Article entitled “Agile Transformation Management: Managing Large-Scale Change in a Fast-Changing World” written by Jaap Backx, Tapio Schrey, Huib Kurstjens, Ana Olgiati, and Reinhard Messenböck on the Boston Consulting Group website on January 10, 2019.
[4] For additional information, read this article entitled “7 Tips to Grow your Enterprise and Business Architecture Practice” written by Daniel Lambert on the IRIS Business Architect website on November 4, 2020.
[5] Quote from this Business Architecture Guild’s webpage here: https://www.businessarchitectureguild.org/.
[6] Quote from the article entitled “Enabling Customer-driven Innovations Using Business Architecture” written by Daniel Lambert on the IRIS Business Architect website on March 11, 2017.
[7] The article entitled “Business Design and Architecture” was written by Daniel Lambert on the IRIS Business Architect website on October 29, 2019.
[8] Quote from an article entitled “the importance of modern data architecture” written by Daniel Lambert on the IRIS Business Architect website on June 20, 2021.
[9] This definition actually originates from Ulrich Homann published in an article entitled “A Business-Oriented Foundation for Service Orientation” in February 2006.
[10] This 29-minute-long webinar entitled “Boosting Organizational Change Management with Business Architecture” was given by Daniel Lambert on February 25, 2021 and recorded on YouTube.
[11] Read more about this subject in the article entitled “The Enterprise Architect’s Ecosystem in an Agile Enterprise” written by Daniel Lambert on the IRIS Business Architect website on January 4, 2019.