Modern, increasingly dynamic businesses must be agile to achieve a competitive advantage. Change is both a liability and opportunity that demands rapid and accurate adjustments to current market conditions. It calls for a formal understanding of the business that can be modified to produce timely innovation, which can then be realized by operational systems that monitor and rationalize actual operation with business intent.
How is this accomplished? The answer lies in the creation of a strong business architecture this includes models of all assets, their interrelationships and their impacts on operational and strategic goals.
The constant evolution occurring in business today requires well-defined business artifacts, or building blocks, for determining how to optimize operations at all levels of the business. An organizations building blocks define how the business works today and the alternative approaches that can be taken in the future. These building blocks are reordered, replaced and retired as part of normal business evolution. They represent pure-business concepts independent of technical considerations, and each has a clearly defined function and fit. Together, business artifacts create a portfolio of ever-changing business capabilities - and they formally define part of business architecture.
A business architecture leverages business knowledge, provides value for IT initiatives and ensures alignment of architecture to strategy and objectives by connecting business artifacts into a single whole, which defines what the business accomplishes, who makes it happen, how it is done, where and when it takes place. The building blocks of the business architecture are data, people, function and rules organized by location and timing.
Once identified and clearly defined, the building blocks are incorporated into models to help build a big picture of the interrelationships of assets and how they can be leveraged to more effectively operate together. In any organization - and most especially in large organizations - capturing assets and creating formal models to reflect how it operates are critical to truly understanding the business and planning effectively for change and growth.
Lets look at how your organizations assets - or building blocks - can be modeled into a complete picture of a business architecture and consider how a formal, scalable approach to enterprise modeling can help you better understand your strategic, operational and physical blocks, how they fit together and how to leverage them for optimal business value and continuous improvement.
Defining the Business Architecture with Enterprise Modeling
Effectiveness is powered by a formal model of the enterprise. An enterprise model is an actionable definition of an enterprise that both defines and links strategy with operations. At the operational level, the enterprise model includes a business and a technical architecture. The business architecture defines - in business terms - the structure, dynamics and policy that support business strategy. The technical architecture defines the technical infrastructure and artifacts that realize the business architecture in operational systems.
An enterprise model is inherently abstract, because it exposes the organizations building blocks, while hiding distractive details. There are many levels of abstraction within the enterprise model - the most fundamental levels are strategic, operational and physical.
The Enterprise Model has three major levels of abstraction:
- The strategic level of abstraction holds the enterprise strategy. The strategy profiles the enterprise in terms of its market position, nature of business, future direction and fundamental capabilities.
- The operational level focuses more on how the strategy is accomplished. This level contains two sub-levels. The architectural sub-level defines, in concept, how the enterprise operates; it establishes intent. The engineering sub-level depicts how the architecture is accomplished considering operational constraints such as resources, time, money and space; this level expresses design.
- The physical level of abstraction corresponds to real artifacts. It represents characteristic instances, such as equipment, buildings, people, programs and databases., that collectively represent the enterprise.
Taking a formal approach to enterprise modeling will allow you to capture your portfolio of assets and leverage them to drive improvements at all of levels of the organization.
Business Processes - the Heart of Business Architecture
Business architecture defines how enterprises conduct business. It includes your business processes, data, rules and agents. Processes governed by rules operate on business data to produce results. The agents are external organizations, internal organizational areas, systems and individuals that perform the activities within a process.
Of all these aspects, the business process is the modern rally point. It is at the heart of the business architecture.
Business processes are an organized network of activities or functions. They accomplish a purpose and produce value by integrating function, data and policy with the agents - such as people, organizations and systems - that guide operations. The main functional artifact is the activity. Each activity performs a well-defined, cohesive function. This function accepts input data which is a formal request for service. It satisfies the request by accessing business data, such as customer records and past orders, and produces a result seen as output data. A business process forms by organizing activities into a network, which establishes clear rules of precedence and the routing of control.
With that in mind, its easy to see why business architecture is integral to other organizational programs, like business process management (BPM).
Consider the case of a leading, global provider of insurance and financial services. This organization offers a prime example of how business architecture can serve as the foundation for BPM and enterprise-level transformation. By providing a contextually-sensitive framework upon which IT can relate its enabling activities back to the business, business architecture allows a systematic way to affect change within this organization. It also enables this organization to capture innovation and ideas - then manufacture them quickly into usable architectural components.
Using enterprise modeling, this financial services organization expects to have developed blueprints for the entire organization within 18 months of starting the project. And the model already has begun to deliver value. For example, one division used the model to rearchitect the organizations banking operations. In doing so, they did not have to model their strategic and enabling functions because they had already done that within the business architecture. That meant the development of the banking architecture was accelerated and the team could immediately focus on its core mission.
Factors for Business Architecture Success
To be effective and successful, a business architecture must include pure business artifacts, execution-ready business artifacts, traceability, multiple dimensions and technical operation:
Pure Business Artifacts
Business artifacts evolve over time as a pure expression of the business - defined and used in business terms, without compromise for technical reasons.
The typical business architecture includes a wealth of artifacts such as activities, business domains, capabilities, classes, constraints, decisions, deliverables, environmental influences, equipment, events, facilities, goals, impacts, locations, markets, measurements, opportunities, organizations, people, plans, problems, processes, projects, requirements, roles, standards, states, stores and systems. It is a rich, multifaceted representation of the business that ultimately focuses on function, data and policy.
Well-formed business artifacts are suitable to be reused. By formally recognizing an organization as a business artifact it is possible to associate the organization as the agent controlling numerous activities across a set of business processes.
Execution-Ready Business Artifacts
Enterprise models with no means for execution will deliver little business value to the organization.
While pure business on the outside, business intent needs to be mapped to the technical artifacts that can deliver that intent within the business architecture. Premapped, reusable business artifacts (ErBA) eliminate the need for a lengthy requirements/design/implement cycle for each business change.
Reuse of a business artifact is not the objective itself. The real objective is traceability. The linking of reused business artifacts is what transforms an inventory of business capabilities into actionable knowledge about the business.
It enables you to navigate across objects and helps answer questions such as, What is the business justification for this function?
An enterprise is a complex entity that requires expressing fundamental concepts such as a single process across multiple, simultaneous dimensions such as area and version. This complexity again points to the need for a formal approach to enterprise modeling - one that is capable of capturing this complexity in a way that is understandable by both business and IT architects.
The business architecture can depict a snapshot of your business at a single point in time. It states the data artifacts used by each activity, which roles belong to which organization, the problems facing each organization, etc. This is accurate but limiting. However, a multidimensional business architecture can simultaneously consider various alternatives across many dimensions such as time, location, version, culture, etc. Rather than operate as a snapshot, the business architecture then depicts a motion picture of the business. It is a model that allows the exploration of innovative change, as well as the ability to analyze actual change over time.
A formal business architecture that can be quickly adapted to current needs and redeployed is essential. Business artifacts tied to technical artifacts enable both quick deployment and the means to rationalize technical operations against business intent with operational metricsthus fostering your organizations continuous process improvement.
Realizing Business Value
An effective enterprise has command of its capabilities. It understands what it can accomplish and has the building blocks in place to affect quick and correct change. The differentiator for modern success is the ability to configure well-formed, reusable business artifacts into the next version of a business process in multiple variations and then quickly realize the innovation in feedback-enabled operational systems.
A major, worldwide airline provides an example of an organization that effectively uses business architecture to realize business value. With each business architecture engagement at the airline, measures of success are gathered for the specific strategy, goal and processes under study using an enterprise modeling solution.
The airlines business architecture team ensures that all the impacted departments establish a clear and consistent understanding of where they are now, where theyre trying to go and how theyre going to get there. Any time there is a change and/or a new challenge with organizational strategies, goals or strategic metrics, the airlines business architects model the underlying business components required to either execute a new strategy or overcome challenges to their strategies, goals and metrics. As a result, they achieve greater collaboration and increased alignment of actions across departments and groups, achieve target goals and eliminate the waste of time, money and resource across areas.
How can you be successful, too?
Dont end up with a library of business building blocks that provide suboptimal value. Using business architecture and a formal approach to enterprise modeling helps bring together a cohesive, big picture view that can be shared across the organization and leveraged by both business and IT toward common goals and objectives that ultimately drive your business success.
Register or login for access to this item and much more
All Information Management content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access