What Is Enterprise Architecture?
The Enterprise Architecture Body of Knowledge defines Enterprise Architecture as "a practice which analyzes areas of common activity within or between organizations, where information and other resources are exchanged to guide future states from an integrated viewpoint of strategy, business, and technology"
In 2007, the MIT Center for Information Systems and Research (MIT CISR) defined Enterprise Architecture as distinct aspects of a business that are under review: “Enterprise Architecture is the organizing logic for business processes and IT infrastructure reflecting the integration and standardization requirements of the company’s operating model. The operating model is the desired state of business process integration and business process standardization for delivering goods and services to customers.”
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It is a blueprint that defines how an organization will be structured and organized. The aim of Enterprise Architecture is to determine how an organization can effectively achieve its present and future goals.
Leveraging Enterprise Architecture Successfully
The key to effectively using Enterprise Architecture is understanding how to address important Enterprise-wide concerns, such as pursuing the new strategic initiative, meeting stakeholder’s needs, aligning IT resources with the business needs, or the reduction of duplicate systems, data, and processes.
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To answer the question of where to start planning an EA and what to focus on, one must first understand the benefits that EA provides and learn which of the architecture relationships and components need to be analyzed to achieve certain objectives.
At the outset, two dimensions need to be considered – the timing of the benefit receipt and the type of value.
Let’s take up the benefits of Enterprise Architecture, first.
EA benefits can be realized in four categories, namely – Operational Efficiency, Process Effectiveness, Opportunity Creation, and Automation Efficiency.
1. Operational Efficiency pertains to the market speed, the current cost reduction, and the quality benefits. Examples include using EA to identify and eliminate costly and complex processes between incongruent systems, using it to standardize the tech platforms and utilize the best practices in order to simplify any training, support, or maintenance requirements, and so forth. Key components when considering Operational efficiency are System Architecture and Technology Architecture.
2. Process Effectiveness relates to the set of provisions for improvement of process opportunities and current revenue generation benefits. The techniques involved in process improvement involve analysis of System Architecture and Business Architecture components in order to perform the business processes.
EA-use here emphasizes how the processes are performed, redesigns, if necessary, and process improvement scenarios, including how the software systems can be used in the implementation of the specific areas of the processes.
3. Opportunity Creation refers to the provision of a mechanism that ensures steady, future revenue generation and the implementation of the new strategic initiatives. This category demonstrates the way in which EA can be used in the promotion of business and the alignment of IT. Examples include using the Enterprise Architecture models to explain the business, assess the impact of business changes, and ensure that long-range systems plans complement the business plans. When pursuing any new strategic opportunities, components like the Strategic Direction and the Business Architecture are emphasized.
4. The Automation Efficiency is a benefit that provides for any future reduction in costs by the alignment of technology planning to the strategies of the organization, and magnify efficiency. EA here can be used in the assessment of the benefits of the impact of the new systems and emerging technologies. An example would be to focus on the strategic use of a specific technology, such as mobile platforms.
Steps To Optimizing The Enterprise
There are many frameworks of Enterprise Architecture that can provide assistance in building components. The scenario given below is one such framework where the EA can be built and benefits realized.
The 1st Step: Define The Enterprise Scope
Given the costs involved in Enterprise-wide deployment, organizations analyze a given framework thoroughly before implementation. The logical first step in any EA design process, thus, is to define the term enterprise itself, and identify its scope. In this context, the most preferred definition of enterprise is ‘any collection of organizations that have a common set of goals and a set of identifiable business metrics.’
Thus, the enterprise can range from being an entire corporation, a single department, or even a group of geographically distant organizations that are connected by common ownership.
Based on the enterprise scope, a strategic direction must be developed and documented. It can be charted to the current components, as well as a future strategic direction.
The 2nd Step: Determine The Future Strategic Direction
For the enterprise, determining the future strategic direction will create a vision that will direct the development of each of the architectural components. The direction validates the business goals, principles, and business drivers of the enterprise. Strategic positioning involves analysis of rival activity and performance, or the performance of similar activities in different ways.
The strategic direction can be based on the customer’s accessibility, the needs of the customer, or the variety of products and services the company offers. During this stage it is important to have a defined future direction that is not similar to the current strategic direction, or it may become difficult to demonstrate the opportunity creation benefits of the EA. If this is a concern, an alternate enterprise will need to be selected.
The 3rd Step: Documentation Of The Current Architecture
The current architecture plan that is impacted by the strategic vision must include the current business, system, and technology architectures, as follows:
As soon as the components of the current architecture are defined, the benefits of the EA can be realized. The image below shows how process effectiveness is achieved by the analysis of the relationship between the system architecture and the business architecture components. In a similar fashion, the operational efficiency benefits are realized by analysis of the relationship between the technology architecture and the system architecture components.
The 4th Step: Designing Future Architecture
Included in the future architecture are future systems, business, and technology architectures, which are as follows:
Competition of the future architecture components will lead to the realization of the future EA benefits. The figure below shows the opportunity creation benefits that can be achieved with an analysis of relationships between the Business architecture and the Strategic Direction components.
In a similar way, the automation efficiency benefits can be achieved with an analysis of the relationship between the system architecture and the strategic direction components providing a justification for the system enhancements that are required to support the enterprise’s future strategies.
The 5th Step: Performing A Gap Analysis
Since the future and the current architectures are already defined, performing a gap analysis is recommended to identify the changes that are required or will be required within the enterprise. The figure shows that gap analysis helps in identifying the process improvements that will be required within the enterprise. It will identify the system enhancements that are required to support the future strategic direction. It will also highlight all of the changes that will have to be implemented within the enterprise.
The Final Step: Evaluation Of Strategic ROI
It is necessary for the timing, risk, resource, and cost requirements to be identified for the improvement of processes, enhancement of systems and the changes in the infrastructure that is required within the enterprise. The diagram shows the changes that represent the timing, the total cost, the resources, and the risk that is needed by an enterprise to support the future strategic direction.
If the ROI that has been calculated for the strategic direction is acceptable, recommended changes can be implemented according to a devised plan. On the other hand, if it is not acceptable, a choice can be made by the enterprise to analyze alternative strategic directions and find a better more suitable result. Either of the two outcomes should serve to add value and to the benefits of the EA with the organization.
Delivering Value To Business With Enterprise Architecture
In an organization, the enterprise architecture facilities the business processes and the applications, information, and the technical infrastructure supporting them. It serves as a valuable management solution while addressing very important enterprise-wide concerns, such as the assessment of impact of business changes, the alignment of long range business plans with the system plans and the focus of the strategic use of technology.
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