Maximising The Value and Benefits of Enterprise Architecture
Alan McSweeney
December 4, 2010 2
Objective
• To explain the benefits of implementing Enterprise Architecture and to identify how the value of Enterprise Architecture can be measured
December 4, 2010 3
Agenda
• Enterprise Architecture
• Issues in IT
• Why Enterprise Architecture
• Enterprise Architecture Measurement Framework
• Enterprise Architecture Value Measurement Programme
December 4, 2010 4
Basis for Enterprise Architecture
• IT systems are:− Unmanageably complex and costly to maintain
− Hindering the organisation's ability to respond to business and economic changing environment
− Not integrated
• Mission-critical information consistently out-of-date and/or actually incorrect
• A culture of distrust between the business and technology functions of the organisation
• Unmanaged complexity in IT landscape leads to greater cost and less flexibility− Issues include lack of standards, redundant applications, multiple platforms, and
inconsistent data
− Enterprise architecture defines a set of tools and methods to address this complexity
− While benefits of Enterprise Architecture are generally understood, measuring value has been a challenge
• No easy answer but Enterprise Architecture approach is really worth considering as a means of addressing these issues systematically
December 4, 2010 5
Enterprise Architecture Is/Does …
• What the organisation does today in terms of IT
• What the organisation wants to do in the future in terms of IT
• The Information Technology assets implemented today
• The Information Technology assets the organisation needs to have in the future to best deliver its business goals
• Defines the framework outlining the vision for systems and technology for the organisation
• Takes the business strategy and translates it into effective change of the organisation
• Manages the Information Technology change roadmap
• Defines a set of overall principles, a future state vision and an implementation and transformation plan
• Includes standards definitions and strategies for services
December 4, 2010 6
Scope and Elements of Enterprise Architecture
Enterprise Architecture
BusinessArchitecture
Software Architecture
EnterpriseInformationTechnologyArchitecture
InformationArchitecture
Enterprise IT Information Systems Architecture
Enterprise ITTechnologyInfrastructure Architecture
Network and Communications Architecture
Storage Architecture
Enterprise Security Architecture
Enterprise ArchitectureGovernance
SolutionArchitecture
December 4, 2010 7
Key Messages Relating to Enterprise Architecture
• IT-business alignment has never been so important
• Alignment must be pursued in the context of understanding business processes and priorities
• Service-orientation is not just for applications
• Service contracts are not just about function: they encapsulate and communicate business priorities to IT delivery organisations
• Enterprise architecture needs to be more inclusive, sophisticated, flexible and integrated
• IT governance models must take all this into account
December 4, 2010 8
IT Too Often Fails to Support Changes Effectively
• Technology integration is costly, risky and complicated
• Information is everywhere but getting access to the right information at the right time is very difficult
• Modifying system behaviour takes too long and changes are difficult to communicate and implement effectively
• Much of IT system and operations expenditure is bloated and fixed where operations run with excess redundant capacity
• IT seen as a cost centre and not a source of business value
December 4, 2010 9
Business View of IT
• IT is viewed by the business as being
• Expensive
• Not connected with business strategy and operations
• Unresponsive to the changing needs of business− Viewed as a critical issue as business agility and responsiveness are essential
for competitiveness
• Undefined and unclear as a business asset− In terms of financial cost and value
− Return on investment and value for money from IT is relatively poor
− The capability the asset should deliver to the business
• Not delivering its promises
• Business change projects cost more and deliver less value than expected or promised
December 4, 2010 10
Causes of Business View of IT
• Business applications tend to be implemented on a project by project basis for specific purposes without overall context
• Project benefits and success have been measured on specific project costs, value and time to market without measuring the long term enterprise-wide cost and value
• Average 75% of total IT budget on RTB operations and 25% on new project investment
• Technology innovation has tended to deliver specific short-term benefits but in the long term of making things worse
• Just look at previous technology innovations such as client/server and 4GLs
December 4, 2010 11
Business Pressures on Information Technology
Business andTechnology
Changes
Regulation
ConsolidationChallengingEconomic
Circumstances
ServiceFocus
Transparency
Globalisation
InformationTechnology
December 4, 2010 12
Business Pressures are Driving Business and IT Change
• Globalisation− Customers, partners, suppliers and greater competition− Connectedness driving value chains
• Transparency− Industry regulations, consumer pressure and competition driving openness
• Service Focus− Differentiation and shareholder value increasingly derived from service experience
• Challenging Economic Circumstances− Need to cut costs and demonstrate real savings− Justify technology investments
• Consolidation− Mergers, acquisitions, takeovers of failing companies
• Regulation− Increased regulation and governance - business is turning to IT to help and IT struggling to respond
in many cases
• Business and Technology Changes− IT becoming commoditised - growth of standards-based technology means that proprietary
solutions provide less differentiation− Speed of technology change− Outsourcing where the right outsourcing decisions require an understanding of how systems
contribute to the business
December 4, 2010 13
Why Enterprise Architecture
• Enterprise Architecture is part of a continuum and not a project− Emerging technologies influence direction of architecture
− Must be subject to change management and governance
− Enterprise Architecture and IT governance should be considered together
• Principles of architecture should override IT hype and transient technology − SOA may be dormant but services and an architectural component continues
− Cloud computing is just another step along the IT/Architectural evolution and another perspective on the future state
• Need better understanding of integration of enterprise and solutions architecture
• Enterprise Architecture is about achieving a common language between business and IT
• Enterprise Architecture driven out of the business strategy provides the enterprise with the highest degree of alignment between the business and IT
• The concept of Enterprise Architecture has expanded well beyond the traditional notion of technology architecture− Now the architecture of the whole enterprise
December 4, 2010 14
Enterprise Architecture - Achieving a Common Language Between Business and IT
• IT-business alignment requires collaboration between the business and the IT organisation to align investment and delivery with business goals and to manage business and technology change
• A common, agreed representation of business activity and goals
• A common, agreed view of how current and future IT provides structured support to the business
• Key requirements and deliverables:
− Investment prioritised in terms of business need
− Systems that deliver value to the business
− Clear direction from the business about focus, strategy
− Collaborative approach to implementing business change
December 4, 2010 15
Enterprise Architecture and Strategy
• Provides the fundamental technology and process structure for an IT strategy
• Provides a strategic context for the evolution of enterprise IT systems in response to the constantly changing needs of the business environment
• Allows individual business units to innovate safely in their pursuit of competitive advantage within the context of an integrated IT strategy
• Enterprise Architecture is designed to ensure alignment between the business and IT strategies, operating model, guiding principles, and the software development projects and service delivery
• By taking an enterprise-wide, perspective across all the business services, business units, business processes, information, applications and technology, Enterprise Architecture ensures the enterprise goals and objectives are addressed as a whole way across all the system acquisition/application development projects and their deployment into production
• Organisations use a business strategy driven architecture approach that focuses on translating the key components of the business strategy into a future state vision and an architecture road map they can implement
• Enterprise architecture is integrated with other strategic planning disciplines, such as programme/project and application portfolio and management
• Enterprise Architecture ensures that the long-term vision of the business is preserved as the enterprise builds new business capabilities and improves on old ones
December 4, 2010 16
Why Manage Enterprise Architecture?
Unmanaged Complexity in IT
Landscape Increased Cost
Reduced Flexibility
Delays in Delivering Changes
Duplication in Resources to
Develop, Operate and Maintain
Business Systems
Cannot to Exploit Economies of Loading and
Scale
Longer Design, Build, Test and Delivery Time
Complexity Causes
Difficulties and Uncertainties
Leads To ..
… Thus Negatively
Impacting on Business
Performance …
December 4, 2010 17
Why Manage Enterprise Architecture?
Enterprise Architecture
Provides a Set of Tools and Methods
Need to Measure Effectiveness of
Enterprise Architecture In
Order to Maximise Business Value
Provides…
… To Address This Complexity …
But
December 4, 2010 18
Value of Enterprise Architecture
Appropriate and Effective
Enterprise Architecture
… Promotes Actions and
Decisions That …
Align Information Technology Plans and Investments with Business Priorities and Requirements
Result in More Integrated Operations Responsive to Customer and Business Requirements
Promote a More Efficient and Effective IT Infrastructure
Facilitate Cross-Organisational Sharing of Enterprise Information
Recognise Innovations and Best Practices Across the Enterprise
Ensure Traceability of Decisions Back to Principles and Rules
December 4, 2010 19
Enterprise Architecture Development and Implementation Process
Architecture Change
Management
Implementation
Governance
Migration Planning
Opportunities and Solutions
Technology Architecture
Information Systems
Architecture
Business Architecture
Architecture Vision
Requirements Management
Data Architecture
Solutions and Application Architecture
December 4, 2010 20
Key Elements/Subsets of Enterprise Architecture
• There are four key architectural subsets of an overall enterprise architecture
− Business/Business Process Architecture - this defines the business strategy, governance, organisation, and key business processes
− Data and Information Architecture - this describes the structure of an organisation's logical and physical data assets and data management resources
− Solutions/Applications Architecture - this kind of architecture provides a blueprint for the individual application systems to be deployed, their interactions, and their relationships to the core business processes of the organisation
− Technology and Infrastructure Architecture - this describes the logical software and hardware capabilities that are required to support the deployment of business, data, and application services and includes IT infrastructure, middleware, networks, communications, processing, standards, etc.
December 4, 2010 21
Issues in Key Elements/Subsets of Enterprise Architecture
• High variability and lack of standardisation across business units (such as ERP templates), driven by changes in business strategy, governance, organisation and process
Business and Business Process
Architecture
• Inconsistent data definitions, multiple databases, releases and configurations which result in duplication of licenses, duplicate and inconsistent information, complexity in testing
Data and Information Architecture
• Multiple vendors, multiple instances and versions which add complexity in procurement, development and release management, resulting in higher costs and longer time to market
Solutions and Applications Architecture
• Multiple operating environments, multiple hardware vendors and types, leading to higher maintenance and personnel costs, greater instability and time-to-fix
Technology and Infrastructure Architecture
December 4, 2010 22
Benefits of Enterprise Architecture
• Align IT and business for planning and execution purposes
• Optimise resources - technology, people and processes
• Increase business interoperability
• Reduce complexity in IT infrastructure
• Improve business agility to support dynamic change
• Drive re-usability of architecture models and best practices
• Streamline informed decision making
• Standardise IT for cost effective delivery of services
• Eliminate duplication and redundancy and reduce cost of ownership and return on investment
• Reduce risks for future investment
• Faster, simpler and cheaper procurement
• Manage information/data and knowledge as a corporate asset
• Manage change based on a clear understanding of its impact
December 4, 2010 23
Risks of No Enterprise Architecture
• Inability to rapidly respond to challenges driven by business changes
• Lack of commonality and consistency due to the absence of standards
• Lack of focus on enterprise requirements
• Lack of common direction and savings due to synergies
• Incomplete visibility of the current and future target enterprise architecture vision
• Inability to predict impacts of future changes
• Increased gaps and architecture conflicts
• Dilution and dissipation of critical information and knowledge of the deployed solutions
• Rigidity, redundancy and lack of scalability and flexibility in the deployed solutions
• Lack of integration, compatibility and interoperability between applications
• Complex, fragile and costly interfaces between applications
• Fragmented and ad hoc software development driven by a tactical and reactive approach
December 4, 2010 24
Issues in Developing Enterprise Architecture
• Issue 1 - Concentrate on the Plan
− Focus too intently on analysis and strategy
−Avoid committing to implementing solutions
−Architecting inhibits value delivery
• Issue 2 - Jumping to the Solution
− Engineering solutions and data implementation
− Technology has difficulty aligning with enterprise
− Reinforces gap between business and IT
• Challenge is to balance evolving strategy, goals, constraints with technology solutions
December 4, 2010 25
Justifying Investment in Enterprise Architecture
Investment in Enterprise
Architecture
Different Investment Approaches
Needed Across Enterprise
Architecture
Longer Term Payback than
Other IT Investments
Reasons for Technical
Decisions Difficult to Communicate
… Involves Challenges …
Impact of Investment in
Enterprise Architecture Difficult to Measure
December 4, 2010 26
Risks Inherent Investment in Enterprise Architecture
���� Enterprise Architecture Investment Spectrum ����
Investment in Enterprise
Architecture is Sufficient to Deliver
Results Without Imposing Unnecessary
Restrictions or Overhead
Too Much Means Enterprise
Architecture Inhibits Flexibility and Imposes Too
Many Constraints -IT Becomes Inefficient
Too Little or On Wrong Areas Means
Operating Costs Increase as
Architecture is Too Complex, Ineffective, Old and Expensive to Operate and Support
���� “Goldilocks” Zone ����
December 4, 2010 27
Enterprise Architecture and Enterprise Architecture Management
Defines a framework outlining the vision for
systems and technology for an organisation
Defines a set of overall principles, a future state
vision and a transformation plan
Include standards definitions and strategies for
individual IT services
Provides the models and practices for defining,
planning and managing the business and IT capabilities
Includes business, data, applications and technology models and principles that support assessments and
investment trade-off decisions, as well as tactical,
project-level designs and decisions
Enterprise ArchitectureEnterprise Architecture
Management
December 4, 2010 28
Relationship Between EA Implementation and Operation Components
Enterprise Architecture
Enterprise Architecture
Implementation and Operation
Enterprise Architecture Management
Enterprise Architecture
Function/ Capability
Function Develops
EA
EAM Measures and Manages the Extent and Operation of the EA and
Provides Governance
Function Implements
EA
December 4, 2010 29
Outcomes of Effective Enterprise Architecture Implementation and Operation
• Specification application architecture requirements
• Definition of architecture methodology
• Standardisation of information elements shared between systems
• Modeling of information relationships and lifecycles
• Deployment integration infrastructure
• Standardisation of hardware and core software platforms
• Building of reusable application components
December 4, 2010 30
Enterprise Architecture Linked to Overall Business Strategy
• Enterprise Architecture aligns business strategy, business processes and IT and provides governance to ensure business value and competitive advantage is delivered
• Enterprise Architecture creates alignment, consistency and unity between objectives at various levels
Business Objectives
BusinessOperational
Model
EnterpriseArchitecture
SolutionDelivery
ServiceDelivery
Business Processes
Business Systems
ProjectArchitecture
DomainArchitecture
Business Strategy
December 4, 2010 31
Enterprise, Domain and Project Architectures
• Enterprise Architecture defines and manages overall organisation architecture
• Domain Architecture(s) are subsets of Enterprise Architecture to enable individual business unit/domain objectives and targets to be met
• Project Architecture(s) enable project level objectives to be met
Enterprise Architecture
Project Architecture
DomainArchitecture
Overall Business
Strategy and Objectives
Individual Business
Unit Objectives
Enabling IT Projects
Enabling IT Projects
December 4, 2010 32
Enterprise Architecture Capability
• The function that enables an organisation to create, adapt, enforce and develop enterprise architecture− Equally a part of the business as it is part of IT
− Role is as much about controlling and focusing IT expenditure as it is about identifying necessary change
• Ensures that the IT landscape is aligned to the business vision and continues to be aligned to the business strategy and operational needs
• Ensures that IT solutions can continuously react to the changing needs of the business
• Ensures that the business and financial case for change is made
December 4, 2010 33
Subsets of Overall Enterprise Architecture
Business and Business Process
Architecture
Data andInformationArchitecture
ApplicationAnd SolutionArchitecture
Technology andInfrastructureArchitecture
December 4, 2010 34
Layers of Enterprise Architecture
Business and Business Process
Architecture
Data and Information Architecture
Solutions and Applications Architecture
Technology and Infrastructure Architecture
ConceptualView DefinesWhat IsRequired
LogicalView HowIt Should BeImplemented
PhysicalView DefinesWhat Should BeImplemented
Overall Enterprise Architecture Context, Security, Governance
Business and Shared Services
Business ProcessesDesigns
Business Processes
Information Services
Data Sources, Targets and
Flows
Database and Message Designs
Application Designs
Business Applications
Application Designs,
Specifications
Overall Network and
Infrastructure Design
InfrastructureServices and Components
Technical Designs and
Specifications
December 4, 2010 35
Enterprise Architecture Management
• Enterprise Architecture needs be a guided strategy that is aligned with the needs of the business
• Enterprise Architecture Capability enables an organisation to create, adapt, enforce, and develop its technical architecture
• Enterprise Architecture Management provides a means to measure the effectiveness of Enterprise Architecture and assist organisations increase business value delivered by IT systems
• Enterprise Architecture Management is a capacity rather than a programme or an end state architecture
• Enterprise Architecture Management provides a capability model with maturity levels for an organisation to achieve desired level of Enterprise Architecture maturity and value
• Enterprise Architecture Management provides a systematic coherent approach to defining, planning, and measuring an organisation's IT assets over time
December 4, 2010 36
Why Invest in Enterprise Architecture
Reduced IT Costs
Increased Business
Value
Solutions will be delivered at lower
implementation and operational costs
IT projects will have a greater success –
delivered on time, on budget and to user
requirements – reducing cost through avoidance
of rework
Enable faster response to business changes and new demands at lower
cost
Enable faster and easier collaboration through application and data
integration
Increased Success in Solution Delivery
Reduced IT Costs
Increase Use of IT
Enable Greater Business
Agility and Flexibility
December 4, 2010 37
Why Invest in Enterprise Architecture
• Business cannot understand why relatively straightforward business changes are costly, risky and slow to implement
• Run The Business improvements and Change The Business initiatives are restrained or prevented by the IT function because to the delay and high cost of implementing changes
• Lack of Enterprise Architecture means operational and support costs of solutions are kept high− Reduces budget available to be used elsewhere
• Situation worsened by projects attempting to deliver in an isolated fashion to bypass inhibitors resulting in further constraints for subsequent projects in the medium term
Solution Implementation
Costs
Post Implementation Costs – Support,
Operation
Solution Lifecycle Costs
December 4, 2010 38
What Manage Enterprise Architecture Value?
• Understand the current state of Enterprise Architecture − Create an accurate view of the current capabilities
− Define the activities to be worked on in partnership with the business
− Create a flexible Enterprise Architecture framework that will govern future initiatives
• Validate Opportunities to Create Business Value− Define the initiatives that will create the most value
− Define a realistic and achievable set of objectives
− Define value measurement to justify commitment and investment
• Develop a a Flexible Initiative and Project Portfolio− Define the set of initiatives and projects that achieve objectives
− Positively vet programmes and projects for value
− Create programmes of work that are justified, measured and managed for value
• Recognise that Enterprise Architecture is strategic rather than tactical− Requires the participation in partnership of business and IT
− Reach of Enterprise Architecture may extend beyond the organisation
December 4, 2010 39
Framework for Enterprise Architecture Management
• Framework provides a means for assessing the Enterprise Architecture maturity level within an organisation
• Can be used to achieve a target level of organisational Enterprise Architecture maturity and therefore value
• Provides a means for continuously assessing and adjusting Enterprise Architecture efforts
• Development of Enterprise Architecture needs be a focussed and managed strategy aligned with the business
December 4, 2010 40
Using Enterprise Architecture Management Framework
• Define the scope and role of Enterprise Architecture and its management within your organisation
• Understand your current capability maturity level
• Systematically develop and manage key capabilities for effective and appropriate enterprise architecture management that adds business value
• Evaluate and manage progress over time using a consistent set of value-oriented metrics
December 4, 2010 41
Using the Enterprise Architecture Management Framework
Define the scope and role of Enterprise
Architecture and its management within your
organisation
Measure and understand your current capability
maturity level
Systematically develop and manage key
capabilities for effective and appropriate
enterprise architecture management that adds
business value
Evaluate and manage progress over time using a consistent set of value-
oriented metrics
December 4, 2010 42
Dimensions of Enterprise Architecture Management Framework
• Measure state of Enterprise Architecture along three dimensions
− Practices
− Planning
− People
• Define facets of each dimension
• Measure each facet in terms of:
− Associated processes and their state of development
− Scope or extent within the organisation
Enterprise Architecture
Practices
Enterprise Architecture
Planning
Enterprise Architecture
Personnel
December 4, 2010 43
Measurement of Value of Enterprise Architecture
• Direct link between Enterprise Architecture and real value can be difficult to demonstrate
• There is a time lag between implementation and results
December 4, 2010 44
Measurement of Value of Enterprise Architecture
• Define Enterprise Architecture value measurement areas
• Identify measurement process
• Measure
− Establish current baseline
−Define target
−Measure results against baseline and target
December 4, 2010 45
Measurement Framework for Enterprise Architecture Management
Enterprise Architecture Management Framework
EAM Dimension 1 -Enterprise Architecture
Practices
EAM Dimension 2 -Enterprise Architecture
Planning
EAM Dimension 3 -Enterprise Architecture
Personnel
1.1 Architecture Framework
1.2 Architecture Processes
2.1 Strategic Planning
2.2 Architecture Planning
3.1 OrganisationStructure and Skills
3.2 Communication and Stakeholder Management
1.3 Architecture Governance
1.4 Architecture Value
December 4, 2010 46
Measurement Framework for Enterprise Architecture Management
Managing communication and expectations with business and IT stakeholders interested in or influenced by architecture management
Communication and Stakeholder
Management
Defining, planning, and managing roles, responsibilities and skills for architecture management
Organisation Structure and Skills
Enterprise Architecture
Defining vision and roadmap for various IT domains by anticipating business needs and trends, and developing architecture components
Architecture Planning
Using architecture principles and blueprints to align business needs with IT capabilities, define portfolio strategy and direction and allocate resources
Strategic Planning
Enterprise Architecture
Planning
Defining, measuring and communicating the value and impact of architecture to the business
Architecture Value
Principles, decision rights, rules and methods to drive architecture development and alignment in the organisation
Architecture Governance
Methodology for defining, developing and maintaining architecture components
Architecture Processes
Framework of standards, templates and specifications for organising
and presenting business and technical architecture components
Architecture Framework
Enterprise Architecture
Practices
December 4, 2010 47
Measurement Framework for Enterprise Architecture Management
• Measure in terms of
− Processes – those processes associated with Enterprise Architecture Management and their state of development – how well-defined and effective are the processes
−Reach - scope or extent of Enterprise Architecture Management within the organisation – how widely used
December 4, 2010 48
Enterprise Architecture Management Assessment Framework
Enterprise Architecture Reach
Enterprise Architecture
Processes
Within Individual Projects
Within an IT Domain
Across the IT Function
Across the Organisation,
Including Business and IT
Functions
Beyond the Organisation
(Suppliers, Partners,
Customers)
Ad-Hoc Processes Defined and Driven
by Individuals
Basic Processes and Associated
Collateral in Place
Processes are Repeatable and
Consistently Used Across Teams and
Projects
Processes are Managed and
There is Continuous
improvement
Processes are Optimised,
Flexible, Adaptable and Lean
December 4, 2010 49
Detailed Measurement Framework for Enterprise Architecture Management
Enterprise Architecture Management Framework
EAM Dimension 1 -Enterprise Architecture
Practices
EAM Dimension 2 -Enterprise Architecture
Planning
EAM Dimension 3 -Enterprise Architecture
Personnel
1.1 Architecture Framework
1.2 Architecture Processes
2.1 Strategic Planning
2.2 Architecture Planning
3.1 OrganisationStructure and Skills
3.2 Communication and Stakeholder
Management
1.3 Architecture Governance
1.4 Architecture Value
Processes Reach
Processes Reach
Processes Reach
Processes Reach
Processes Reach
Processes Reach
Processes Reach
Processes Reach
December 4, 2010 50
Enterprise
Architecture
Practices
Enterprise
Architecture
Planning
Enterprise
Architecture
Personnel
ProcessesReach
Processes
Reach
Processes
Reach
Complete Measurement Framework
• Three dimensions x two aspects
December 4, 2010 51
Planning
Practices
People
Strategic Planning
Architecture Planning
Organization Structure
and Skills
Communication and
Stakeholder Management
Architecture Framework
Architecture Processes
Governance
Value and Measurement
None
Project-based
No roles,
responsibilities
Project-based
None
Project-based
processes
None / project-
based
None / project-
based
Project-based
Limited vision and
roadmap
Formal technology
roles within projects
Key stakeholders
identified and informed
Limited framework -
covers some
information
Defined processes
primarily focused on
infrastructure
Some review principles
defined for some
components
IT cost metrics
Prioritization of project
portfolio based on
roadmap
Architecture planning
process established
Formalized roles and
responsibilities
Regular consultation
with business
Covers Information and
process, but adoption not
consistent
Defined processes
across IT domains
Defined IT governance
boards and processes
IT cost performance
metrics
Architecture a key
input to joint
Business / IT planning
Continuous
improvement
Clear professional
career track
Pro-active
communication and
feedback with
business
Consistently adopted
internally
Defined processes
across business and IT
domains
Shared governance
model with Business
and IT
Defined and measured
business objectives,
performance metrics
Business / IT planning
enables efficiency, agility in
extended enterprise
Includes extended
enterprise capabilities
Pro-active development
with external input
Collaboration with
extended enterprise
Framework shared
externally
Defined processes with
clear ability to adapt and
extend
Business / IT governance
continuously improved to
respond to change
Business outcomes and IT
performance metrics
Level 1 Level 2 Level 3 Level 4 Level 5
Architecture Funding
Project-based
allocation
Central architecture
fund
Funded from efficiency
gains
Funding by margin on
servicesFunding by transaction
Enterprise Architecture Management Maturity
December 4, 2010 52
Assessing Current and Future Desired Architecture Management Maturity
5 - Optimised4 - Managed3 - Repeatable2 - Defined1 - Ad-Hoc
Communication and Stakeholder
Management
Organisation Structure and
SkillsEnterprise Architecture
People
Architecture Planning
Strategic PlanningEnterprise
Architecture Planning
Architecture Value
Architecture Governance
Architecture Processes
Architecture Framework
Enterprise Architecture
Practices
Current EA Competency Maturity Level Desired Future EA Competency Maturity Level
December 4, 2010 53
Measuring Maturity and Importance
Level of Importance
5.04.03.02.01.01.0
2.0
3.0
4.0
5.0
Level
Of
Maturity
Architecture Value
Architecture Framework
Architecture Processes
Architecture Planning
Strategic Planning
Communication and Stakeholder
Management
Organisation Structure and Skills
Architecture Governance
December 4, 2010 54
Benefits of Increasing Enterprise Architecture Management Maturity
• Measuring the true impact of increasing Enterprise Architecture Management maturity is hard to achieve
• IT architecture simplification can be one of the largest contributors tor IT cost reduction (in the range of 5%-18%) but it has a long lead time - up to 2 years
December 4, 2010 55
Outcomes of Effective Enterprise Architecture Management
Standardising Hardware and Core Software
Platforms
Standardising Information Elements
Shared Between Systems
Building Reusable Application Components
Specifying Application Architecture
Requirements
Deploying Integration Infrastructure
Defining Architecture Methodology
Reduced Costs
Modeling Information Relationships and
Lifecycles
Service Improvements
&
December 4, 2010 56
Impact of Effective Enterprise Architecture Management Can Be Difficult to Quantify
Increase flexibility within the business and IT
Lower capital spendLeverage new capabilities for competitive advantage
Sustained cost reductionsHigher application development
productivity
Eliminated or reduced spend on redundant application purchase
and development
Improved operational efficiency and effectiveness
Faster access to informationSimplified analysis and testing
Reduced operational riskBetter information qualitySimplified development
Higher IT productivityRenegotiation/consolidation of supplier
contracts
Increased hardware utilisation and deferred or eliminated
hardware spend
Better IT and business decisionsIntegrated infrastructure and
application managementShorter integration time (and corresponding project time
Improved responsiveness to business needs
Rationalised application portfolioLower integration costs (and corresponding project costs)
Tertiary/ Long-Term Benefits
Secondary/ Medium-Term Benefits
Primary/ Immediate Benefits
December 4, 2010 57
Impact of Effective Enterprise Architecture Management Can Be Difficult to Quantify
Scope and Benefits of Enterprise Architecture Over Time
Ease of Measuring Benefits of Enterprise Architecture
Primary/
Immediate
Benefits
Secondary/
Medium-Term
Benefits
Tertiary/
Long-Term
Benefits
Directly
Quantifiable
Difficult to
Define Intangible
December 4, 2010 58
Measuring Quantitive and Qualitative Value from Enterprise Architecture
Measures of Value from Enterprise
Architecture
Quantitive Measures of Value
Qualitative Measures of Value
Reduced Project Risk and Complexity
Improved Business Requirements Delivery
Reduction in project time and cost over-runs both without scope or
quality reduction
Improved Project Success
Solution quality, delivery on-time and within budget and to user
satisfaction
Cost Control and Improved Return on
Investment
Measuring return on projects over lifetime
Reduced Costs for Business As Usual
Operations
Complete operational costs of IT to reflect the total cost of ownership
Enable Delivery of IT Strategy
Sustained delivery of the IT Strategy which should also be
concerned with delivering value
Reductions in faults and overspend due to incorrect requirements
Better Alignment with Business
Quality-related feedback from the business through regular surveys
Increased Agility and Competitiveness
Measure through feedback where IT is viewed as an partner and
enabler with the business and not just a cost and constraint
Improved Business Knowledge
Measure through effect with the business becoming better
connected and greater reach of processes
December 4, 2010 59
Focussing on Areas of Low Maturity and High Importance
Importance
Maturity
First Areas To Focus On To Generate
Improvements
Third Areas To Focus On To Generate
Improvements
Second Areas To Focus On To Generate Improvements
Fourth Areas To Focus On To Generate Improvements
Low View of Importance High View of Importance
Low Maturity
High Maturity
December 4, 2010 60
Focussing on Areas of Low Maturity and High Importance
• Use Enterprise Architecture measurement framework to identify areas of greatest return on investment
December 4, 2010 61
Enterprise Architecture Value Measurement Programme
• Does the Enterprise Architecture programme have a measurable impact on the IT investment portfolio?
• Does the Enterprise Architecture programme lead to measurable improvements of performance?
• Is there a clear relationship between Enterprise Architecture programme and business services?
• Does the Enterprise Architecture programme result in measurable cost savings/avoidance?
Define Enterprise
Architecture Measurement
Framework
Measure Enterprise
Architecture Value
AnalyseEnterprise
Architecture Value Measures
Plan Enterprise Architecture
Implementation/Enhancement Programme of
Work
Execute Programme
Measure Delivery and Results
Feedback on Measurement Framework
December 4, 2010 62
Summary
• Appropriate Enterprise Architecture can deliver significant business benefits
• Comprehensive Enterprise Architecture value measurement framework is needed to link Enterprise Architecture to business benefits
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