To put it in a nutshell, enterprise architects are charged with the tasks of recording the current state of the business and its technology assets, defining their future state, and developing a viable roadmap needed to link these two states. Of these three tasks, the most challenging is often that of defining the future state: the model of the business that will result from changes in the business strategy. This is partly because many aspects of the future business model may be vague or poorly understood, and partly because critical information may be deliberately withheld.
Get to grips with Business Strategy to build credibility
In a typical large company, strategic directions are set by the executive board, but the case for action, the options going forward and many of the detailed aspects are then worked on by business strategy staffers and management accountants. All too frequently, these senior support staff fail to appreciate the IT implications of the required changes to the business model, and this can lead to significant implementation delays and cost overruns. While the enterprise architects should have the skills and knowledge to inform the strategy development process, they often lack the credibility to make effective contributions.
How to Build Engagement
How then can an enterprise architect engage in the relevant business strategy conversations at the right time and at the right level?
From our consulting experience, the best way is to enter into these conversations already forearmed with some knowledge of the business strategy. There are two important sources of available information to draw on, both of which are usually in the public domain. The first is the annual report of the business, backed up by quarterly updates. The second is the set of current reports provided to industry analysts. It’s often not difficult to pick out topics from these sources that have a direct bearing on the IT estate.
An example
At one time we were retained as advisors by a company that had a highly centralised business model. Its newly appointed Head of IT Operations had decided to negotiate long term, global contracts with some key suppliers – a logical move, one would think. Unfortunately, both he and the CIO were blissfully unaware that the Board had made a strategic decision to decentralise powers, including procurement, to the company’s geographic regions. And this decision was laid out in some detail in a publicly available paper from the Chairman of the Board to the industry analysts.
The point here is not to present yourself as some kind of alternative business strategist, but to engage with enough knowledge to be treated as a serious player. With any luck you will then be drawn into the right conversations without having to knock on the door.
But what of the situations where secrecy is of paramount concern? In a recent blog post we cited a company that had planned a merger with one of its competitors without having taken account of major incompatibilities between the two organisations’ operating models and their supporting information systems. Because he had been excluded from the “need to know” group, the CIO and the Chief Enterprise Architect learned of the plan only six weeks prior to the scheduled merger date. The damage to the business that resulted from this oversight completely wiped out the financial benefits of the merger itself.
So how could this and similar pitfalls be avoided?
The most important need here is education. The business strategy planners need to appreciate the constraints of the current operating model, at least at a broad brush level. And even allowing for the need for the utmost secrecy, some trusted individuals from the IT function need to be engaged in the process at an early stage. In the case above, the systems of each company had been designed to handle a single currency within a single fiscal boundary. Unfortunately, as the two companies were in different countries with different currencies, it was impossible to select a common system for the merged organisation without a major rewrite to cover multiple currencies and different fiscal requirements. Such considerations did not feature in the due diligence process.
A smart enterprise architect would have spotted this straight away.
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Roadmapping and Strategy – an Approach for Success
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