I recently began using the term "Hinges of Business" to describe the areas between business domains that form the real basis for execution. The term is derived from Thomas Cahill's concept of the hinges of history, which are the time periods between major changes that effectively led to a major turn of events. In business, no division, department or other organization is an island. The real business of doing business happens in the areas between departments, divisions and other organizations.Being able to see the hinges of your business requires the ability to look at your organization holistically. That is not as a set of discrete domains but as an interrelated group of functions that organizes and separates via subsets of resources on a routine basis. When you view your organization as a set of stovepiped domains, processes tend to mature in a domain-centered fashion. Thus, a domain requires all inputs to their processes to be provided in a way that best suits the processes they created without consideration of the burden it may create on other domains.
Today, many hinges are poorly defined and, therefore, lead to difficulties in execution and operational performance problems. For example, when insufficient availability of office supplies forces employees to make in-store purchases, the organization ends up paying more for the goods, adds overhead to accounts payable for an expense reimbursement and has to deal with lost employee utilization. Another example is due to inconsistencies that occur in retail businesses where stores are not replenished quickly enough due to the latency inherent in the intricate network of purchasing and procurement.
While many believe enterprise architecture is a pure IT function, it is in fact about helping the organization to take an enterprise-centric view of process maturity, thus identifying ways to minimize the burden on individual departments when their process crosses between boundaries. Hence, governance of the hinges becomes a managed entity of the enterprise and the costs and time associated with poorly performing operational tasks can be lowered and improved respectively.
For example, a mature, well-oiled department with high-quality systems and a high degree of automation generates paper reports to another department or division within the company as the primary means of data transfer. Some of you reading this would be surprised to find out that this still occurs in at least 25% of large organizations and more heavily in the government. In this particular case, the lower automation and process maturity level of the receiving department could limit the overall throughput of the more mature department, however, the typical result is that the more advanced department becomes autonomous, thus resulting in operational redundancy and higher costs. At a minimum the less advanced department lowers the overall operational performance of the enterprise as a whole.
In our 1998 book, Manager's Guide to Distributed Environments, my coauthors and I introduce the concept of the role of a chief enterprise architect as the individual responsible for designing the processes and integrations across departments and divisions. Based on this role, I believe that the enterprise architects should report to the chief operating officer, not the chief information officer, and should lead the effort to gain control over the enterprise's hinges of business.
Additionally, the four steps below have been identified as ways that your organization can take to gain better controls over the hinges of their business.
Step 1. Start with a 360-degree review cycle. You could spend hundreds of thousands of dollars having a big consulting company come in and attempt to assess where your problems are, and they may even get some right, but why do this when your employees will tell you what you need to know for the same salary you're already paying them. Provide your employees with the means to let your know where their greatest source of frustration is in executing and you will quickly identify at least five areas for improvement in the span of a month.
Step 2. Hire an experienced enterprise architect (EA). This sounds easier than it is. A good EA must be a counselor, visionary, diplomat, technologist and, most of all, a good communicator. I have seen organizations move individuals into this role based on past managerial performance but regretted this decision. This is not a senior appointment that you are creating as a reward for delivering successfully. This is the person that is your key change agent for better overall operational performance. Leadership experience, not managerial experience nor technology aptitude, should be the key attribute of this individual.
Step 3. Train for business process reengineering. Once the EA identifies the best approach for intra- and extra-organizational communications, you are going to require trained, task-oriented individuals to capture and institute process changes across affected departments. The attributes that comprise a good EA, often make them poorly suited to pay attention to fine-grained details. This is the role of your business process re-engineering team. They should be taught to use the latest tools for business process management, business rules capture and business activity monitoring to help them succeed in their efforts.
Step 4. Enable execution. All the planning in the world is worthless if the plan does not get executed. Change is difficult. Even if the proper justification for change exists and it will yield a reasonable return on effort and investment, many plans have not been executed due to executive or senior staff buy-in. One of the biggest issues with these types of changes is governance issues - someone will lose control over a process that they currently own. This leaves two options: a) executive order forces implementation, which is usually acceptable in the cases where the current process owner's role is disappearing; or b) you must show the current process owner how this change helps them to move up in the organization or take over governance of other processes.
Again, the first three steps are easily achievable by most organizations, however, the fourth step is often where even best laid plans fall apart. By gaining control over your hinges of business you will increase your enterprise's operational efficiency and lower operating costs.
JP Morgenthal is managing partner for Avorcor, an IT consultancy that focuses on integration and legacy modernization. He is also author of Enterprise Information Integration: A Pragmatic Approach. Questions or comments regarding this article can be directed to JP via e-mail at email@example.com.
This article originally appeared in DM Review.
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