In large enterprises, the barrier to increased efficiency and business agility is almost never technological: It's organizational. Business management has a set of goals; IT does its best to meet those objectives effectively and efficiently. But dysfunctional governance, legacy rules and processes, and miscommunication between business and IT management all too often prevent enterprises from moving forward cohesively to address the latest challenges and opportunities.
Enterprise architecture (EA) provides common ground for business and IT to work together. Until an organization has a top-down view of itself, with the means to assess the business value of IT activities and investments across the board, strategic plans are made in a vacuum. EA provides a mechanism for that self-assessment. But it also provides effective frameworks to turn ideas into full-blown initiatives with proper controls, best practices, and allocation of resources. Only with such frameworks in place can rational technology decisions be made.
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InfoWorld and Forrester Research share a similar view about the value of EA to organizations -- and also believe this value is seldom given its due. To rectify that, we worked together to develop the Enterprise Architecture Awards, with the intent of recognizing companies whose practice of EA has delivered substantial business benefit to their organizations.
We began the process of collecting nominations for the Enterprise Architecture Awards in the spring of 2010. Choosing five winners from a wide array of entrants, many with compelling tales of transformation, wasn't easy. In the end, we chose these five winners: Aetna, Barclay's Bank, Discover Financial Services, Skandia UK & International, and Wells Fargo Bank. We believe all five exemplify the discipline and collaborative spirit needed for true organizational change.
The practice of EA is sometimes caricatured as an ivory-tower endeavor with a distant connection to the way business and IT operate on the ground. The principles and frameworks of EA may appear to be abstract -- but only when they lack the context of successful initiatives deployed by companies like these. We hope you find the stories of these five enterprises compelling and instructive for your own EA endeavors.
Aetna, a leading provider of healthcare and related benefits, recently went through the daunting task of changing the lens through which it views its business model -- and the IT assets that support that model. Historically, Aetna viewed its business capabilities and IT asset and technology investments from a business unit or product perspective. Yet it knew it needed an enterprisewide view that would enable identification of business capability and system redundancies to support a more efficient business model -- one that could evolve in future years.
The EA team in Aetna tackled this challenge using business capability maps for integrated views of processes, systems, information, and technologies. The project necessitated a strong partnership from the business. The EA team provided insights to senior management on the capabilities Aetna's systems and business processes provided, as well as finding opportunities to unify or reuse capabilities and evaluating how existing or planned capabilities aligned to core strategies. The capability map analysis enabled EA to respond to the business' questions - but would the business recognize the value of these maps going forward?
The worries were unwarranted. After using the capability map to demonstrate reuse opportunities and capability gaps, the business has welcomed the EA team's participation and contributions and plans to work more closely with the group in 2011 for future planning cycles. Already the business recognizes how the Aetna Capability Map helps focus technology investments on capabilities that will provide the greatest benefit to the enterprise, which will reduce costs and improve time to market in the future.
"This firm's use of capability maps as a business blueprint to inform and influence strategic planning and portfolio management is a huge leap forward, and it provides the firm foundation for industry and IT benchmarking and decision-making in the future. Capability maps such as these are a "next practice" in enterprise architecture," said Doug Mutart, one of the judges of the Enterprise Architecture Awards.
Barclay's Bank may predate the American Revolution, but that doesn't make the company old-fashioned. In fact, Barclay's EA practice provides a modern example of success that other banks would do well to follow.
At Barclay's, which has more than 48 million customers and clients worldwide, the EA practice is responsible for enabling a governance framework that ensures corporate investment is aligned to strategic technology architecture and that it delivers business value. Historically, Barclay's has managed development of IT strategy and roadmaps independently within each major line of business. Given the number of applications (more than 2,000) and the aggregate IT spend (in excess of £ 1billion), central groups found it challenging to obtain a consistent and holistic picture across investments and change portfolios -- making it hard to ensure that business value was being maximized.
To address this challenge, frameworks, processes, and tools were developed that enabled the delivery of roadmaps in a common language and format. Joint sign-off by both business and technology executives increased shared understanding, ownership, and accountability. With an enterprise view, the EA team was able to assess the impact of investment decisions across business and technology, enabling planning and portfolio management to move up the maturity curve. Among their newly gained benefits: increased interaction between business and technology leaders that led to a common vision; a continuous and repeatable mechanism that allowed ongoing investment plan revision; savings from more than 60 synergies identified across business unit roadmaps; and increased EA's credibility.
"If EA is to make a difference I would expect mechanisms to be in place to execute its influence in project portfolio management and development projects," said Bob Marsh, a judge of the Enterprise Architecture Awards. "[Barclay's demonstrated] excellent, well-thought-out linkage to the business [with] good consideration of communication and governance."
The team could not have completed the project without a team of architects and practitioners who could engage all facets of the business. For two years, the team created a community of chief architects and roadmap practitioners who brought a cross-functional view of business and IT architecture to roadmap planning. By successfully engaging business executives, technology leadership, business systems planning, governance, finance, risk and control, service delivery and operations, and in-country technology teams globally, Barclay's was able to develop roadmaps at least three years out for all business units.
Discover Financial Services
With 10,500 employees and 1,400 IT professionals, Discover Financial Services has a big IT footprint. IT supports all lines of business, from credit card issuing to direct banking to payment services. Discover operates with a "less is more" corporate philosophy and the EA department has fewer than 15 people.
In late 2007, Discover IT management saw great potential in recasting the EA function from being solely focused on EA technical analysis and standards to being a facilitator of strategic business alignment across the company. The company launched its Enterprise Architecture Repository project to incorporate a more efficient use of EA capabilities by all stakeholders in the company.
With this repository, the EA team has established five new core competencies: improve the business through IT strategic alignment, coordinate innovation across the company, act as a center for professional (certified) EA architects, aggregate technical "meta" information, and provide governance for technology standards across Discover.
The investment in an EA Repository and metadata has yielded efficiencies that have led Discover to more effective technical assessments -- a process that was once quite cumbersome. By introducing the EA Repository, the company was able to identify expensive and outdated legacy applications that resulted in application "tuning." This step alone provided $500,000 in processing cost savings.
With a complete view of all IT across the company, strategic business assessments of proposed projects are now completed in a timely and well-organized manner. As an example, Discover's Architecture Review Board, which evaluates and governs all IT-related projects, has seen substantial reductions in the review and approval process. In 2007 only 40 percent of submitted designs were reviewed and approved in less than 10 days, but by the end of 2009 that number increased to 92 percent.
"If EA is to make a different, I would expect mechanisms to be in place to execute its influence in project portfolio management and development projects," noted Marsh. "It's important to consider how to measure this and even better to have already noted benefits."
With the EA Repository project, Discover has enjoyed significant cost conservation: As a direct result of the project and the Architecture Review Board improvements, the company saw $4.4 million in IT savings and/or cost avoidance in 2009; in the first quarter of 2010 it has already documented $390,000 worth of savings. Not only does the EA Repository serve as a central tool for the overall IT governance process, more importantly, through the increased visibility that it offers, EA is able to contribute to strategic business decisions and to the operations of a more cost-efficient organization.
Skandia UK & International
Transformation is a word that gets thrown around frequently in business and in IT. But in the case of Skandia UK & International, which is owned by Old Mutual, transforming the IT department did indeed occur during the past two years in anticipation of projected business growth in the UK financial services market.
The IT organization was tasked with increasing capacity so that Skandia could build multiple systems to support business growth and enter new markets, as well as reduce risk, increase the certainty of delivery, and lower costs (the latter through the use of offshore partners).
The existing systems were legacy -- green-screen based and difficult to change. Delivery lacked robust controls and IT was perceived as lacking innovation, expertise, and direction. The tasks were enormous: outsource IT, create a new organization to direct and govern the supplier, rebuild relationships with the business, define a business-aligned technology strategy and roadmap -- and deliver it within a two-year period. All on top of incorporating and enhancing a major platform acquired through the company's merger with Old Mutual.
To guide this transformation, Skandia management created the "Darwin Programme," an enterprise architecture initiative that brought together business and IT leaders. The initiative engaged business units across the United Kingdom and other countries to define and govern a series of system roadmaps. The roadmaps were created jointly by business subject matter experts, business architects, and analysts, as well as the architects in the EA practice who led the definition.
All domain architectures and roadmaps are approved at the Darwin Board and are refreshed regularly to show progress. The new working model and governance has become embedded into the fabric of the company and is considered business as usual -- in fact, it's common for team members to co-locate with business stakeholders, which has solidified the relationship with the business side and ensured adherence to enterprise standards.
Skandia has incorporated hard and soft measures to monitor its EA journey. These include the savings accrued from the reuse inherent in the company's SOA implementation (currently greater than £500,000 in the first year alone) and the level of adherence to the roadmaps and governance process (currently more than 90 percent of total IT spent). Softer measures include the level of satisfaction of Skandia IT's business customers, which has improved to the point where they now actively promote their collaboration with IT. The EA function has changed the perception of IT from "business blocker" to an enabler of better solutions.
"This initiative demonstrates a clear road towards closer business-IT alignment, sought after by many large companies," said Jan-Paul Buijs, a judge for the Enterprise Architecture Awards. "It shows the combined effect of a strong multidisciplinary vision and approach, true IT craftsmanship, innovation focus, delivery power, and a very proactive, hands-on approach."