Listen to our own Brian Seitz in a conversation on IAMCP’s inaugural podcast episode. Brian talks to IAMCP’s host, Jeff Shuey, about enterprise architecture, explaining that enterprise architecture is all about how you design an enterprise – focusing on people process and technology. Click below to listen!
Building for Change
by Roger T. Burlton, Ronald G. Ross & John A. Zachman1
The Prime Directive
All initiatives must demonstrably align with the Management Imperatives.
I. Perpetual Change
- Accommodating unceasing innovation and fast-paced change is mandatory for business agility.
- The existing business must be changed continuously to sustain business relevance in a continuously evolving external ecosystem.
- While perpetual change is unavoidable it must be accommodated in such manner that existing value chains are not subject to unnecessary risk during transitions.
- Perpetual change depends on a Business Knowledge-Base for predicting and mitigating the impacts of changes, especially their unintended consequences.
II. Business Solution Agility
- Developing software faster is not sufficient, in and of itself, for survival and growth because once operational, such software is likely to prove difficult to continuously and rapidly change without unintended consequences.
- The true measure of an agile business solution is how much business knowledge is configured into it and how easily that knowledge can be changed or reconfigured.
- Deployment of business knowledge into business processes and products should be timely, effective, selective, repeatable, pervasive, traceable, and retractable.
III. Business Value Creation
- Business value must be the over-riding justification for expending resources (money, time, etc.) for all investments including software development or acquisition.
- Business value can arise from enhanced business solutions or from changes to accommodate the shifting business ecosystem, but not from software features alone.
- Avoidable scrap and rework due to lack of business knowledge and lack of alignment is pure waste.
- Value creation optimized for silos rather than for whole value chains sub-optimizes customer experience and received value.
- Planning and managing value creation requires a value chain model that can be used to design, change, manage, operate, and analyze the entire value chain.
IV. Value Chain
- The business knowledge and work required to deliver products and services to a market should be organized according to their natural dependencies (that is, a value chain) as opposed to being organized by existing organization structures.
- The marketplace determines the natural boundaries of a value chain. Contributing stakeholders may be internal or external to the business.
- The role of each stakeholder in a value chain must serve the best interests of the entire value chain, including accommodating constraints of other stakeholders. Measurements, targets and incentives for stakeholder roles should be aligned to the value chain outcomes that best serve customers.
- Trying to eliminate silos or product pipelines and improve end-to-end processes in a value chain without a concept model will at best prove difficult. It will guarantee rework and delays.
- Knowledge of the dependencies in a value chain enables prediction of the impacts of change and provides natural criteria for scoping the boundaries of business design and software implementation initiatives.
V. Business Knowledge
- Business knowledge is not the same as software development knowledge.
- Business knowledge covers all design characteristics of the business needed to create, operate, manage, and change its value chains, as well as to evaluate their performance. It also covers underlying business capabilities and enabling resources (financial, human, facilities, equipment, etc.) on which value chains depend.
- Effective, unambiguous communication of business knowledge depends on shared understanding. That understanding must be deliberately managed by means of a concept model, which also serves to retain knowledge and enable its reuse.
- Business knowledge in downstream portions of a value chain is dependent on business knowledge needed for upstream portions. The most reusable business knowledge is created early in the value chain, then reused throughout.
- Business knowledge covers all business rules independent of their employment in automated systems or manual workflows so they can be dynamically located, enforced, modified, and reused in every relevant situation.
VI. Business Knowledge Management
- Business knowledge should be expressed explicitly in a form accessible to all business audiences.
- Effective management of business knowledge requires that it be rendered in explicit, accessible, protected, sharable, re-usable, retainable, and updatable form.
- Effective management of business knowledge requires a formal storage facility (automated and manual) and processes for sustaining its currency and integrity.
- Effective management of business knowledge requires that it be secured from physical or cybernetic compromise.
VII. Business Knowledge-Base
- The Business Knowledge-Base is the end result of transforming tacit (mental) knowledge to explicit (stored, common, sharable) knowledge.
- The Business Knowledge-Base provides permanent transparency about design decisions in configuring business products and processes.
- The Business Knowledge-Base is essential not only for automating processes, but for assembling all business capabilities.
- The Business Knowledge-Base is critical for locating and reusing business capabilities, and for dynamically predicting and mitigating the impacts of change.
- The Business Knowledge-Base is not a typical technology implementation but rather a mandatory business asset for the Knowledge Age. It should therefore be under the purview of general management.
VIII. Single Source of Business Truth
- The Business Knowledge-Base is the single source of truth for authorized business concept definitions and business policy decisions, continuously available for all business audiences, independent of geography and time, instantaneously accessible, and designed to accommodate perpetual change.
- The Business Knowledge-Base is a single source of truth about business rules, business activities, and other business characteristics upon which operation of value chains depend.
- To serve as a single source of business truth that effectively facilitates change, the Business Knowledge-Base must maintain separation among all elemental building blocks that can be configured into business capabilities or business solutions – for example, concepts from business rules, business rules from processes, processes from events and roles, etc. – as well as from all technical design descriptions.
IX. Business Integrity
- Inconsistent or conflicting business results impacting external stakeholders such as customers, regulators, etc. lowers credibility and creates potential legal liabilities.
- Failure to consistently meet contractual obligations and commitments to external stakeholders is incompatible with a customer-centric focus.
- Properly designing the structure of business concepts to ensure consistency in business results – i.e., designing a concept model – will avoid needless subsequent redesign and reconstruction of databases and systems.
- By enabling consistent behavior and repeatable operational decisions, business rules are an essential part of business knowledge.
- A main cause of data quality problems is failure to consistently use authorized business definitions and business vocabulary as prescribed by a concept model and to faithfully follow business rules.
X. Business Strategy
- The means to survive in or dominate an industry, and to deter new entries, will increasingly depend on managing business knowledge.
- The business knowledge necessary to execute the business strategy and to configure business processes and products is special and invaluable. It is increasingly indispensable for sustaining competitive advantage.
- Bots will complement and enhance – but not displace – the need for explicit business knowledge.
- No new business or technology channel will ever emerge for which business knowledge isn’t needed. Technologies come and go. Business knowledge is persistent.
- Given the pace of innovation and change, solutions for business agility are critical to the business today.
End Note: There is nothing theoretical or technical that constrains or prohibits realization of all the Principles in this Manifesto. The business knowledge and all the Principles need not be completed or in constant practice to continue operations or to do new work, including software implementations. It is going to take time, dedication and perseverance. Every Principle is well-established conceptually, logically and physically. The only thing required to realize these Principles is deciding to put them into practice and committing to iterative and incremental, dedicated realization as a new way of life, a new paradigm. The only logical argument for ignoring them is that building software faster is more important than how successfully the business operates in the increasingly dynamic and complex, high-risk environment. Somebody is going to do this … best it be YOU.
© Business Rule Solutions, LLC. 2017. 1 © John A. Zachman, Zachman International. 2017.
© Process Renewal Consulting Group (2015), Inc. 2017.
Permission is granted for unlimited reproduction and distribution of this document under the following conditions: (a) The copyrights and this permission notice are clearly included. (b) The work is clearly credited to its three authors. (c) No part of the document, including title, content, copyrights, and permission notice, is altered, abridged or extended in any manner.
- Thanks to Gladys S.W. Lam for input to the content and organization of the Manifesto document suite and to Sasha Aganova for shepherding the work through to completion. ↩︎
With all the adamant touting on behalf of the business transformation tool commonly known as Enterprise Architecture (EA), it seems that the important word enterprise has, regrettably, been scantily defined. Even among the steadily growing community of worldwide EA practitioners, who of course are supposed to be leading the way in accurately defining words for their respective organizations, the most important word in the entire industry remains a mystery.
This excludes, naturally, those who have joined the world of PEAF, which stands for Pragmatic Enterprise Architecture Framework. PEAF’s creator Kevin Smith has likened EA to a garden scenario in which EA correlates to the broad and wide-scoped task of setting up the environment for the garden, rather than the detail-oriented work of buying supplies, laying piping, and the like. Claiming that EA sets up the garden’s environment is a transformative concept with staggering implications, even if only for the simple fact that it relies on a description of the enterprise that seems so alien to the “mainstream” understanding of the enterprise, including the views held by many EA practitioners.
If EA refers to the environment, the context, then it includes the consideration of many factors and aspects of reality, extending beyond the firm itself. Like in a garden, the weather must be considered as an influence, as well as pests and zoning laws and vehicular accessibility etc. As Kevin Smith notes in his introductory book on PEAF, the enterprise must include “communities, governments, non-clients, non-suppliers, anti-clients, etc.).
If this is the case, and we here at Elyon are convinced that it is, then the implications are important. In fact, the current struggle that the EA world faces in differentiating between EA and E(IT)A can be removed simply by defining the word enterprise correctly. For if EA was an IT-only issue, then the “E” must be defined in a way that strips it of its power. But Elyon and PEAF refuse to do that. We insist that EA is nothing without the power and effectiveness of the Enterprise.
And only when we look through that holistic lens can transformation begin to take root.
What if Google decided that today it was going to transform itself? What if they had been so influenced by a speaking engagement by Kevin Smith of PEAF or Carl Engel of Elyon that the executives had come to the conclusion that transformation was the answer to all their worries? And what if they took $250 million cash and applied it straight to their transformation efforts?
And when they were done, five years later, they presented themselves to the public with a new grey and black logo and a new search engine that randomly shuffled all the results, rather than organized them by relevance. This would be called a marketing fiasco. But at least they transformed right?
Our point here is that transformation in and of itself is not the goal. Rather, transformation is the means to a better goal. If the goal in business is transformation, businesses would hardly ever falter. In fact, any time there was a threat of struggle anywhere in the organization, all that would be needed to be done is a completely erratic and arbitrary change. That is, what is technically known as transformation.
But this is not the type of transformation that the Enterprise Architect is advocating for. Transformation must be architected. Transformation as a concept, when applied to the EA context, has specific goals in mind. First, the transformation must be effective. Which means that the enterprise purpose must be followed and only the “right things” should be done. Second, the transformation must aim for efficiency. Not only must the right things be done, but those things must be “done right.” Third, transformation must be agile in that the right things may be “adapted quickly” given their immediate and long-term context. Fourth and finally, transformation must be durable. Without foreseeing the future needs and applying the “right things” so that they last to that future, transformation is a misallocation of resource.
These four goals of transformation are also stated as the “EA goals” in Kevin Smith’s introductory book to PEAF. Since EA is ultimately about transformation, we are able to look at these goals in application to transformation. By tying EA and transformation closely together, it becomes obvious that to transform for the Enterprise Architect is meaningless without the actual architecture process. Transformation should not be a stand-alone goal. Not all transformation is created equal. It must be full of great architecture.
“One of the most unfortunate side effects of the revolution in desktop computing technology… has been the backlash against anything related to long-term planning.” (Steven L. Shaffer, Transition to open systems, 1996)
We are living in wake of this side effect, an era of great enterprise debt. It is like a sea all around us. Our businesses show it, our local authorities show it, Wall Street shows it; our infrastructure paychecks, and children’s education show it. This sea of enterprise debt has large swells caused by the rapid growth and sprawl of IT at a consumer level. There is a large economic undertow that points to our co-dependency on technology with a denial of our loss of life independent of technology. All this under a low pressure system and jet stream of change in global intelligence, market and tech-tonic shifts.
Okay, that is a bit extreme, but the point needs to be made that the cost of leaving inefficient things running, operating with old processes, and leveraging debt beyond the tipping point is very high. Enterprise debt occurs when we cut corners and do 80% of the right thing. Eventually those corners we have cut amount to insurmountable trials. Let me give you three:
1. Sinking ship: Hole in our profit margin.
While we continue sales, the lack of effectiveness begins to and eventually washes away our profit margin. To gain these profits, expenses continue to grow. Profits may be rising but the cost of those profits is reaching the point at which we will not be able to produce the profits. Unnoticed, that hole in our profit margin will produce a sinking ship. Sinking ship unnoticed and the ship is forced from commission or simply sinks.
2. Starboard engine out: Legacy systems out of gas
Another huge issue is leaving aging IT solutions in place past their life expectancy, and even beyond their contribution to efficiency of the organization. On these ships, large quantities of mussels attach themselves to the hull in the way of work-arounds, patches, interfaces, dozens of small applications, and large amounts of data redundancy without business intelligence and metrics.
3. Adrift: Compass has no vision
With mission in tow, the organization simply holds on to dashboard and key performance indicators like: still afloat, still a ship, haven’t lost the crew, and we can still hold more cargo. However, when it comes to moving forward in the new culture, economics, and regulations, the ship cannot move. It doesn’t know where to go.
So what is the answer to mounting levels of enterprise debt, growing complexity, and high levels of volatility?
The application of architecture to the growing enterprise problems may be the only solution. The fact is: “What has got organizations where they are now, will not be sufficient to take them where they need to go.” And even more importantly, over time “What has got organizations where they are now, will not be sufficient to even allow them to survive.”
Organizations will have to stop pursuing quick wins and low-hanging fruit because they will not be sufficient to reveal and remove hidden Architectural Debt. In time, organization complexity and volatility will continue to grow unless a pragmatic enterprise transformation process is adopted.
In other words, the sea will win, and the USS Enterprise will have to be taken out of service or sink.
The solution: Pragmatic EA, powered by Elyon Enterprise Strategies, Inc.
In the most recent release of Forbes Magazine, a curious study was revealed to the readers in which three key words were used to demonstrate a trend in the so-called “Middle Market Companies.” However, for those who are proactively defining the market and closely anticipating the future of global enterprise, perhaps the survey was not so curious after all. In fact this study came as a clear and happy verification.
The study’s introduction stated clearly that:
“Companies with a more ‘transformative’ mindset are more likely to achieve a range of benefits that drive stronger financial performance.”
In other words, it is those companies who have adopted a cultural realization of transformation that are most suited to achieve their goals.
“Transformative mindset.” Toward what end? The title of the article informs us: Harnessing Innovation to Jumpstart Growth. Once the transformation mindset has been realized, innovation can be harnessed; that is, it has a purpose and a direction. What is that direction? “To jumpstart growth.”
[title size=”3″]Transformation. Innovation. Growth.[/title] The three words.
Here at Elyon Strategies, our specialty is Enterprise Architecture. But we have recognized that perhaps this is far more “ivory tower,” or “snooty” than it needs to be. For all we are, once we have eliminated the fluff, is a group of transformation specialists. We agree with the conclusion in this study that the “transformative mindset” is the key to the successful future of the enterprise. Which is why we have made it the function of our services to ensure that each and every client whom we work with is caught up in the wonders of transformation.
Since transformation is our goal, we have a set of five principles in order to maintain our focus and path toward an ever-transforming transformation mindset. We recognize that if we are pursuing transformation, our clients too will follow. Two of these principles are “innovation” and “growth.” Therefore, our interpretation of the study, which effectively and succinctly supports the “Elyon way,” is that the world is catching on. The transformation revolution is not something that the writers at Forbes have invented. Neither is it something that Elyon has fabricated out of thin air. Businesses around the world are recognizing that the “transformative mindset” is the necessary mindset.
“Transformation starts here,” is our motto. It is our breath. Truly, it has become our mindset. In this recession-ridden economic environment your choice is simple: you can join the rest in recession, or join Elyon in progression.
But if you choose the latter, understand that only transformation can get you there. And it gets you there by allowing you to harness the economic demand for innovation in order to jump-start your growth. The Forbes conclusion, and the Elyon way, is just what the modern enterprise needs.
Change. Can you think of a scarier word for the modern enterprise? In the highly competitive world of 21st century enterprises, change means to shift from a point of comfort and familiarity to a point of fast-paced learning. Change entails an unknowable future. And therefore it entails risk.
And therefore it also demands a heavy emphasis on Enterprise Architecture. It is true that you can get from point A to point B without “EA-ing” yourself. But what most enterprises realize when they enact change without EA, is that point B is never what they want it to be. And perhaps point B was a bad goal, because their vision requires point C.
Change then, without EA, has its emphasis on risk. Without architecting the change, risk is multifaceted. Not only is there the presence of the unknowable, but there is also the lack of financial calculation to indicate cost savings, adequate matrices to identify success, and, perhaps most devastating, insufficient documentation to track the heavily involved labor and hours.
Change is inevitable. The 21st century market environment demands it. But as for risk… risk is largely a choice. And it is not a choice that lies on the shoulders of the top-notch IT guys. Rather, it is the responsibility of the chief executive, that is, the leader of the “business-side.” The leading corporate world of tomorrow, regardless of the country and culture, from the United States to Great Britain to Hong Kong, will depend on who takes the responsibility for proper change today.
Everybody knows the economies and markets are changing. But who is willing to invest in Enterprise Architecture to limit their risk exposure? That is the question. Elyon Enterprise Strategies stands ready to answer, for anyone ready for change.