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- Business Model Design - The Capability Driven Roadmap PRESENTED TO BOC’S EA INFO DAY APRIL 10TH 2014

David O’Hara Principal Consultant , Enterprise Architects

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- About Enterprise Architects - Designing the Business Model:

Responding to the challenge of Disruption

- Creating a Capability-Driven Roadmap - EA Case Study & Tool Demo

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Introduction › 20 years in Business-facing roles in the IT industry, mostly private sector » Telco, Retail, FS…

› Principal Business Architect (EMEA) at Enterprise Architects » Architecture practitioner & trainer

David O’Hara › Enterprise / Business Architect

› Specialising in Business Architecture over 9+years » Business Engagement » Business Motivation » Capability Driven Planning » Enterprise Roadmaps » Building EA Practices @DaveO_EA @enterprisearchs

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#EAID2014

Enterprise Architects

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About Enterprise Architects

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› Enterprise Architects (EA) is an international professional services firm providing strategy & architecture services.

› Our core value proposition is to help clients unlock the value of their investments using the principles of architecture.

› Our vision is to be the most respected specialist architecture organisation globally, setting new standards for effectiveness in strategy execution.

› We believe that architecture is important and, when done well, will profoundly improve corporate performance.

ENTERPRISE ARCHITECTS © 201 3

Our Services Enterprise Architects is a dedicated team of architecture specialists • • • • • • • • •

• • • • • • • •

IT Strategy Delivery Blueprint & Roadmap Development Consulting, Advisory & Mentoring Services Enterprise, Business, Technical & Solution Architecture Practice Capability Development Maturity Assessments Governance Risk & Compliance Framework & Tool Selection and Support Repository Management

Consulting Services

• •

Contract, Perm & Interim Recruitment Interim Leadership Executive & Retained Search & Selection Candidate Assessments by Qualified Architects Contract Staff Backed by I/P Supplied Staff Trained to TOGAF® 9 HR Career Management Flexible Workforce Planning and Delivery

• • • • • •

Talent Services

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Training & Development

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• • • • •

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Knowledge Community

TOGAF® Certification ArchiMate® Advanced & Applied EA Business Architecture Information Management & Governance EA Kickstart (Combined Consulting, Training & Mentoring) Customised Private Training – Solving Topical Issues

Exclusive Chief Architect/CTO Round Tables Virtual Teaming & Practitioner Collaboration Industry Groups & Focus Events Practitioner Communities Career Support & Advice ‘Lifetime Relationship’ Commitment

www

enterprisearchitects.com youtube.com/user/EntArchitectsEA @enterprisearchs facebook.com/enterprisearchitects enterprise-architects

…join the discussion! 7

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Designing the Business Model Responding to the challenge of Disruption

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Overview The challenge facing Enterprise Architecture: to re-design Business Models › Change is the only constant…..…..so what else is new? › In the Digital economy, both the PACE of change and IMPACT of change are increasing: market disruption, driven by digital innovation, is occurring more frequently and with greater effect » New players, differentiated offerings, new Business Models….

› For CIOs and Chief Architects, working at the Operating Model layer is not sufficient to respond to these external challenges › Architecture needs to evolve: from Operating Model design to Business Model design

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Change is moving faster…and the Business Model shelf-life is shrinking Who is best placed to respond to this challenge?

…so Business Models become ‘stale’ and must be renewed

PERORMANCE

ENTERPRISE

BRAND PLATFORM

BUSINESS MODEL

BUSINESS COMPETENCIES

PRODUCT

TIME ‘Enterprise Lifecycle's 2014 © Enterprise Architects PTY LTD

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As what was once innovative becomes commoditised, value discipline orientation changes…

Enterprises must learn how to design and execute Business Models Who is best placed to understand and respond to this challenge?

Enterprise Architecture

› Architects deeply understand both Business Capability AND Technology… › ….and how they can be remodelled around changes in business strategy

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Architecture requires a balance of thinking styles The challenge is identifying the right skills in the organisation that are able to traverse the domains of innovative, intuitive thinking and reliable, analytical thinking.

Corporate Governance

GOAL: Reliably produce consistent, predictable outcomes

NPV

Value Engineering

Business Intelligence

Five Forces Financial Modelling

Mission

Enterprise Patterns

Environmental Scanning

Stakeholder Goals Value Business Brand Architecture Management

Integrative Thinking

GOAL: Produce outcomes that meet desired objectives

Business Perception Model Design Management Strategic Root Cause Wicked Traceability System Analysis Problems Thinking Portfolio Capability Analysis Innovation Management Collective Operation Business Intelligence Management Analysis Talent Six Cost Management Thinking Product Engineering Hats Quality Management Crowdsourcing TOGAF Management Knowledge Data Ecosystem visualisation Six Sigma IT Governance Change Solution & Lean Management Architecture PRINCE2 Gamification

EVA

ANALYTICAL THINKING

Search for “The EA Headspace” 12

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INTUITIVE THINKING

Our Focus Areas * From Roger Martin (2009) The Design of Business

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Systems Thinking

Vision & Mission

Coherence

Design Thinking

Business Model Prototyping

Business Outcomes

Value Systems

Capabilities

Innovation

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Visualisation

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What is a Business Model? Some Definitions › “A Business Model is a set of activities which a company performs, how it performs them, and when it performs them, so as to offer its customers value whilst making a profit” › Business Models – A Strategic

The Business Model Market Model

Operating Model

Markets Industries Customers Market Segment Channels

 Customer Relationships  Value Proposition  Offering: Products / Services  Capabilities  Processes / Value Chains  Business Services  Functions  Data  Applications  Technology

The Environment 14

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Management Approach

Value

Products and Service Model

    

› “A Business Model describes the rationale of how an organization creates, delivers, and captures value” › Alex Osterwalder – Business Model

Generation

› “A Business Model is a framework for creating value in a coherent manner”

Craig Martin, Chief Architect @ EA

The goal of a good Business Model is to create coherence Building coherence requires an understanding of the components of a Business Model, and how to assemble them in a manner that is innovative and differentiating whilst maintaining stability. › A Coherent Business Model is one that is synchronised around:

The Business Model Markets Industries Customers Market Segment Channels

Market Model

    

Products and Service Model

 Customer Relationships  Value Proposition  Offering: Products / Services

» its market position, » its product and service portfolio; and » its most distinctive strategic capabilities

› All of the above working together as a system

Operating Model

      

Capabilities Processes / Value Chains Business Services Functions Data Applications Technology

The Environment 15

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Capability Driven One of the ways we create coherence is through capability based planning › Capability driven architectures are designed to support the strategic objectives of an organisation

› Capabilities consist of people, process and technology › To fully understand a capability all these components must exist regardless of their maturity level

Capability based planning is one of the tools that looks at the best “mix” of resources required to develop this coherence

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Mission

CAPABILITY

Vision

People

Strategies

Goals

Process Outcome

Tactics

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Objectives

Technology

Typical architecture practice maturity Value

E The majority of organisations today sit approximately here on this curve

D C B

A EA = IT Architecture Improve project performance

EA = Enterprise-Wide IT Architecture (EWITA) Improve IT performance

EA = Strategic Enabler + BA + EWITA Improve Market Performance (Shareholder Value)

EA = Product Architecture + Business Architecture (BA) + EWITA Improve Product/Service Performance

EA = Business Architecture (BA) + EWITA Improve Business Performance

Business Architecture is seen as a positive progression away from IT

Mandate *Adapted from Ruth Malan, Dana Bredemeyer

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What is Business Architecture? › We like to refer to it as “the Design of Business” › It is about giving strategic business objectives greater clarity and structure by describing how they translate into operations.

› The goal of Business Architecture is to operationalise business strategy, thereby helping business leaders avoid a risky leap directly from strategy to specific project investments.

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Positioning Business Architecture Business Architecture must connect strategy to business and IT change

Strategy

Business Architecture

Implementation

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provides the crucial business context for the ‘technical’ layers, aligning architecture ‘services’ to provide coherent business outcomes

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Information

Applications Technology

SERVICES

› Business Architecture

Business Enterprise Architecture

Business Architecture is an integral part of the Enterprise Architecture

Outcomes

The contribution of Business Architecture relates to the mandate…. Mandate = IT OPTIMISATION

Value

The Capability Anchor Model Application Architecture Roadmaps and Migration Planning

B

A EA = IT Architecture Improve project performance

Technology Architecture

Application and Integration Architecture

EA = Enterprise-Wide IT Architecture (EWITA) Improve IT performance

Mandate 21

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…and views and viewpoints will be different…. Mandate = BUSINESS OPTIMISATION Org. Structure Required to Fulfil

Value

Capability Maturity Overlay Process Maturity Assessment

The Capability Anchor Model

Key Points &Assumptions

Methodology and Approach : 62%of Posts processes are underdeveloped and potentially impacting business  The average process maturity acrossthe The Process Owners classified the process enterprise 2.3is maturity of the4level activities within their 1. PROCESS MATURITY FINDINGS  62%of activities have a process maturitydesignated of process . area Maturity Level 5 Average Adhoc or Repeatable  Results were validated by practitioners out in Level 1 Level 2 Level 3 Level 4 Assessment Best Total Process Adhoc Repeatable Defined Managed Practice Maturity Summary the business  Process Areas Manage Information Knowledge &Systems and Pan have the lowest average  Activities were classified against the Carnegie Plan 24 28 5 5 0 62 1. 85 Level 1– Adhoc ,95, process maturity –1.7 and1.8respectively Mellon Capability Maturity (CMM )Model Level 2– Fulfil 18 22 52 14 0 106 2. 85 22% Repeatable , 172,  95Level 4activities (22%)have been classified The CCM split maturity five (see categories 40% Info , Knowledge & Systems 24 22 7 0 0 53 1. 68 table below ) ranging from1Level (adhoc ) to with a Level 1maturity (adhoc –minimal to no People 6 38 11 2 1 58 2. 21 Level 5– Best Practice , 14, development of process and ) procedureLevel 5(best practice ) Finance 2 5 13 17 12 49 3. 65 3% Level 4–  The average process maturity for each process Assets& Services Managed , 53, 5 25 5 5 1 41 2. 32 12% area(plan ,market , etc.… )is a linear average of Market 12 8 4 7 0 31 2. 19 Level 3– Defined ,99, the supporting4activities level . i.e. all Customer 4 24 2 3 0 33 2. 12 23% processes have equal . weightings 95 172 99 53 14 433 2. 35 Totals 22%

Source : Process Maturity Assessment conducted by the Process Owners

Process Maturity Classification Level 1 Adhoc

Australia Post has minimal to no development of processes and procedures across the organization .

Level 2 Repeatable

Australia Post has defined all processes and procedures which are standardized and integrated across the organization .

Level 4 Managed

23%

12%

3%

Project

100 %

62%of activities are underdeveloped (not defined )

Australia Post has adopted leading practices and an approach for continual process improvement

1. PROCESS MATURITY FINDINGS Avg. Process Maturity 5. 0

Level5– Best Practice (5) High room for improvement



The processes supporting the enterprise are on average repeatable– i .e. they are not standardised across the enterprise



Opportunities to improve efficiency exist through standardising and streamlining processes



Plan and Manage Information Knowledge and Systems have the highest room for improvement

Level4– Managed (4)

4. 0 Level3– Defined (3)

.

3. 0 Level2– Repeatable (2) 2. 0

3.7

1. 0

1.8

0. 0

Plan

2.2

Market

2.6

Fulfil

2.3

2.2

2.1

2.3

1.7

Interact with Manage Customer Finance

Manage People

Manage Manage Information , Assets & Knowledge Services & Systems

Level1– Adhoc(1)

P R O G R A M M E C O M M I T T E E

Level 5 Best Practices

Australia Post has defined key performance indicators which are used to manage and measure process and procedural performance .

COO

Mana Manage and ge deliver Custo content Business Unit - ser ving Cor por ate A m er Relati ons Business Unit – ser ving end user s

IT Design and Developm en t .

Business Unit - ser ving content pr ovider s

The lowest capability maturity exists , Knowledge in Information &Systems and Plan

Level 3 Defined

Australia Post has established basic processes and procedures which are repeatable across the organization

40%

Reconfigurable

P R O V I S I O N I N G

Pr oject Resour ces (Technical)

Specialists and f unctional staf f combine to f orm project teams

Pr oject A

Pr oject Resour ces (Functional)

Pr oject B

Specialists

Pr oject C

SHARED AND ADMINISTRATIVE SERVICES

Matrix

National Accounts

Virtual

Opex vs.. Effort to Increase Efficiency

Dual reporting lines with shared services servicing all business units

Market Segmentation

Total

Source : Process Maturity Assessment conducted by the Process Owners

Project teams are created based on shif ting strategies. Permanent f unctional structure exists.

CEO

Small Business (value segment)

Mkg.

Small Business (cost segment)

Individual Consumer

Company structures around market segment

CEO

Dist. Mkg.

Product Design

Sales

Focus on core and outsource the rest

Marketing

Time Based Marketing for Today’s :

Marketing for Tomorrow’s :

Dual organisations one unit f ocusing on tomorrow, one on today

Loss of coherence Across the Transformation Programs

HIGH COVERAGE

• Strategically critical • HIGH coverage by in-flight initiatives

• NOT strategically critical • HIGH coverage by in-flight initiatives

# In-flight % Gap Initiatives

Ref

Capabilities

C14

Sales Planning and Management

9

0%

C15

Sales Execution

6

0%

C30

Network Development

6

0%

C3

Plan to Realise

5

11%

C10

Channel Strategy Management

4

25%

Capabilities

Customer Service

9

0%

C34

Track and Trace

4

0%

2

14%

4

40%

C45

Initiative Coverage (primary impact on L1 and L2 activities only)

Ref C1

C8 C13

C2 C5

C40

LOW COVERAGE

C48

Capabilities

# In-flight % Gap Initiatives

Research, Analysis & Insights Market Planning Business Performance Management Corporate Vision & Strategy Management

Acquisition and Divestment People Planning Asset Lifecycle Management

• Strategically critical • LOW coverage by in-flight initiatives

YES

4

50%

3

60%

4

75%

2

100%

2

100%

4

100%

3

C43

Information, Knowledge & Systems Delivery People Day-to Day Management

Plan & Market Information, Knowledge & Systems

Capabilities

# In-flight Initiatives

% Gap

People

C44

Finformation, Knowledge & Systems Planning

11

63%

Assets & Services

C45

Information & Knowledge Governance

11

67%

C41

Recruit & Retain People

5

21%

C4

Innovation Management

3

100%

C51

Supplier Relationship Management

2

100%

Ref

Some business rules

Procedure or simple algorithm

High

Realisation Tactics Complex negotiation, design, or decision process

Many business rules; expertise involved

# In-flight % Gap Initiatives

Ref

C17

Cost/ Value/ Asset Apportionment across the business

Funds investment

Outsourcing Projects

Major redesign projects Sof tware Automation Projects

Straightf orward, static commodity processes: use automated ERP-Type applications and / or outsource

Credit card approval

• NOT strategically critical • LOW coverage by in-flight initiatives

NO

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On-line purchasing

Inventory Management

ERP based process improvement

Strategic Importance Must be done but adds little value to product or services

Mandate 22

Deals with other companies

Complex, dynamic processes of high value: undertake business process improvement ef f orts that f ocus on people

International Delivery

Low

100%

Strategically Important

New Product design

Complex Processes, not part of company’s core competency: Outsource

Process Complexity and Dynamics

Strategic & Project Investment Priorities and Focus Areas

EA = Business Architecture (BA) + EWITA Improve Business Performance

Low

C

Widget assembly

Straightf orward, static, and valuable: automate to gain ef f iciency Six-sigma based process improvement

High Very important to success, high value added to products and services

…relative to the concerns of different stakeholders Mandate = STRATEGIC OPTIMISATION

Value

EA = Strategic Enabler + BA + EWITA Improve Market Performance (Shareholder Value)

EA = Product Architecture + Business Architecture (BA) + EWITA Improve Product/Service Performance

E

D

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Our Findings: ownership gap For Business Architecture, lines of responsibility are often unclear

Business Ownership Strategic Architecture Mandate –

Unresolved Business Architecture Mandate

The Business Model Market Model Products and Service Model

Operating Model IT Ownership IT Architecture Mandate –

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    

Markets Industries Customers Market Segment Channels

 Customer Relationships  Value Proposition  Offering: Products / Services

?

 Capabilities  Processes / Value Chains  Business Services  Functions  Data  Applications  Technology

The Environment

Views and Models Supporting the Mandate The Business Model Markets Industries Customers Market Segment Channels

Market Model

    

Products and Service Model

 Customer Relationships  Value Proposition  Offering: Products / Services

      

Mandate

Operating Model

Capabilities Processes / Value Chains Business Services Functions Data Applications Technology

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› Business Model Innovation

› › › ›

Customer Experience Journey Maps Learning Maps Motivation Models

› Value Maps › Product and Offering Maps › Design Models › › › › › › ›

Value Chain Analysis Cross Functional Models Capability/Business Anchor Models Process Models Application Models Data and Information Models Technology Models

So how do we respond? Responding to the disruption challenge and ownership gap › If the goal of EA is to create coherence not just at the Operating Model level but at the Business Model level, EA must:

› Learn and apply new skills…start thinking like Business Designers! › Elevate the discussion with the business from the Operating Model level to the Business Model level » First and foremost, communicating in the language of the business » Embracing business strategy concepts › Engaging the Business and ‘prototyping’ new business models » Using the right tools for the job: the Business Motivation Model and the Business Model Canvass, not just the Capability Model

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Summary Responding to Disruption means changing the mandate for Architecture

› The Business model lifecycle is shrinking! › To unlock the full potential of Architecture, the mandate needs to increase away from the Operating Model level › Enterprise Architecture must equip the CIO to engage other ‘C’ level stakeholders around the concept of Enterprise Design (i.e. not architecture)

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Putting it into perspective Our universe is expanding… › As the pace of change and impact of disruption increase, and the ‘shelf life’ for Business Models decreases, we will see emerging demand for Enterprise Design skills › To support this demand, the mandate of EA must increase to be about creating coherent Business Models › However, we won’t be asked: EA has the opportunity to ‘step up’ and lead The Design of Business: but we must consciously move away from the Operating Model level and develop the competencies to redesign and prototype new business models 28

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You are here

Thanks End of part one….!

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The CapabilityDriven Roadmap Approach and Case Study

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Failure points between strategy and implementation In navigating between strategy and execution there are multiple possible failure points



STRATEGY

The drivers of strategy are often misaligned



Strategy not sufficiently tied to operations



Needed capabilities not properly understood or measured

Is my investment portfolio balanced across all of the economic value add dimensions?

Where can we take advantage of synergies across the major strategic programmes?

There is a lot of activity going on out there, how do I know we are doing the right things?

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



PROGRAMMES

Benefits aren’t quantified or traced back to original goals

Planners not accountable for delivery

Are we investing in the right areas across the enterprise?

Are the strategic programs aligned, or for that matter, are they the right strategic programmes?

This often leads to some typical stakeholder issues regarding transformation exercises

Addressing the failure points between strategy and implementation › To address these failure points we should focus on the following three areas:

1. Creating a clear view of the goals, value drivers and corresponding levers that drive the strategy



STRATEGY

The drivers of strategy are often misaligned

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

Strategy not sufficiently tied to operations

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2. Clearly linking the strategy to operations through capabilities



Needed capabilities not properly understood or measured

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3. Establishing the resources that are needed by the capabilities and ensuring business architects provide oversight at portfolio level



Planners not accountable for delivery



PROGRAMMES

Benefits aren’t quantified or traced back to original goals

Developing the Capability Driven Roadmap The Challenge: creating traceability from strategy to implementation

‘Anchor Models’ Motivations

Business Model

Capability Model

Target Architecture

Maturity & Gaps

Work Packages

Current State Arch.

Transitioning

Capability uplift delivered in increments through business & technology change Technology decisions must be traced back to a business objective via the capabilities they enable

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What is the Business Motivation Model? The BMM is a Blueprint to help develop the Business Architecture, and provides a consistent language to articulate business strategy

The BMM is a construct for developing business plans, but is not in itself a methodology. The BMM structure supports the progression from Vision to a set of concrete Goals and Objectives

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Mission

CAPABILITY

Vision

People

Strategies

Goals

Process Outcome

Tactics

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Objectives

Tools

What is a Capability? Some Definitions › An ability that an organization, person, or system possesses. Capabilities are typically expressed in general and high-level terms and typically require a combination of organization, people, processes, and technology to achieve. For example, marketing, customer contact, or outbound telemarketing. – The Open Group › The power or ability to do something – Oxford English Dictionary › Measure of the ability of an entity (department, organization, person, system) to achieve its objectives, specially in relation to its overall mission. – Business Dictionary › The ability to perform or achieve certain actions or outcomes through a set of controllable and measurable faculties, features, functions, processes, or services. – Wikipedia

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Identifying Capabilities Some Guidelines › All enterprises have ‘capabilities’ – they are the fundamental business outcomes of the enterprise » Capabilities are the things the enterprise must be able to DO in order to fulfil its mission

› Capabilities will tend to persist over time » what changes is the way in which the capability is fulfilled (the ‘How’), who is fulfilling the capability, where it takes place and their importance to the business strategy

› Capabilities are expressed as outcomes and should be agnostic of technology, product, organisational unit, etc. » Meaning the same capability could be performed by different organisation units or in different contexts, potentially in different ways

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Linking Business and IT Architectures Business Architecture will define the capabilities required to realise and sustain the business strategy. IT Architectures will help to enable these capabilities.

Business Architecture Information Technology Architecture

CUSTOMER

Requires

People

PRODUCT

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APPLICATIONS DATA

Process

PROCESS

PEOPLE

CAPABILITY

INFORMATION

Uses

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Tools TECHNOLOGY

Business Capability Model Case Study Capability Model transposed into ADOit

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Mapping Capabilities to Applications & Technology Supplier Relationship Management (SRM) Supplier Management

Planning & Budgeting

2

JDE Supplier Management

4

4

SAP SRM

2

Oracle EPM

Knowledge Management 4

4

Sharepoint

Business Intelligence

3

3

Hyperion

2

4

Oracle ECM

4

3

Planner

2

3

KMI

2

4

3

Oracle BI

4 3

Business Objects

Management Reporting

COGNOS

2

4

3

4

Oracle BI Management Reporting

4 3

COGNOS

2 4

Hyperion

2 4

2

MFG/Pro

2

3

PeopleSoft E1

3

Supplier Manager

2

4

Oracle WCM

4

4

JDE

4 4

SAP

2

3

PeopleSoft E1

3 4

Oracle EBS

4

SAP SRM

3

3

PeopleSoft E1

3

2

Product Lifecycle Management (PLM) Product Portfolio Management 5 PPM 5

Ideation & Concept Management

New Product Development 5

PLM

Demand Planner

2

1

Production Planning

Materials Planning

Demand Supply 3 Tool

Capacity Planning

4

JDE

4

2

MFG/Pro

2

High Technical Fit Low Technical Fit

Purchasing

4

SAP

2

4

4

Oracle EBS

4

4

JDE

4

3

PeopleSoft E1

3

Inventory Management

SAP

2

4

4

JDE

4

4

Oracle EBS

4

3

PeopleSoft E1

3

Warehouse Management

JDE

4

4

4

SAP

2

4

Oracle EBS

4

2

MFG/Pro

2

Distribution Management

JDE

4

4

SAP

2

4

Oracle EBS

4

3

PeopleSoft E1

3

4

JDE

4

Enterprise Asset Management

4

SAP

2

4

JDE

4

4

Oracle EBS

4

3

SAGE

3

3

Oracle SRM

4

3

PeopleSoft E1

3

Trade Promotions Management 3

TPM

3

SFA

2

3

Field Manager

1

3

Job Manager

1

4

After Sales

5

2

MFG/Pro

2

Manufacturing (Operational Technology) 4

4

Rockwell

SCADA

4

4

SAGE

Quality Management 2

2

2

MFG/Pro

4

JDE

Financial Management 4

2

SAP

2

4

JDE

4

4

2

MFG/Pro

2

3

BACS

3

Oracle EBS

4

3

PeopleSoft E1

3

MYOB

1

4

SAP

2

4

4

Oracle EBS

4

3

Recruitment Management

Workforce Management 3

Chris 21

3

Annual Leave Request

2

Time & Attendance 4

Tracker

Rewards Management 3

Chris Payroll

1

4

PeopleSoft

3

4

SAP Payroll

2

3

Oracle Payroll

2

3

ALESCO

2

3

Expense Management

2

Organisationa l Development Management

3 3

2

3

Consumer Management (CM) Consumer Marketing Management

4

T&A

3

4

Secure

3

4

CRONOS

3

Performance Review

3

Campaign Manager

2

Consumer Sales Management

Lifecycle Management - A replacement strategy, if required, must be in place for all applications with this status.

Application/Financial - Spend and change must only occur as part of projects that assist in removal of this application.

4

Retailer

2

Lifecycle Management - Applications which cannot readily be removed will be ringfenced. If this approach is taken, design patterns must exist for working with the application. Usage & Governance – Must avoid use of Exit Applications as they are subject to defined decommissioning strategy. Any circumstance which promotes extended use of Exit applications must seek exemption from the Head of Infrastructure and Operations together with the Head of IT Strategy and Architecture before usage approval can be given.

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An assessment of Business Fit indicates the degree of alignment with the application’s business users.

Organisational - All change requires formal approval from the Head of Infrastructure and Operations together with the Head of IT Strategy and Architecture, which will only occur where it contributes towards Retiring the application, or meets a mandatory requirement due before exit is complete.

Retail Management

Application Status

Contain

Application/Financial - this installation is not to be extended in use. Where possible changes will not occur to the existing environment - it is to be allowed to age towards sunset with minimal additional spend.

Retire - Avoidance; specialist (non-core) resources and processes required to keep in the environment

Color Description

Emerging

Usage & Governance – Projects should specify the use of Core Applications where available in the knowledge they are fully supported by service management and operational capabilities.

Usage & Governance – Projects should generally avoid use of Contain Applications as they are invariably subject to near or medium term sunset. Any circumstance which promotes extended use of Contain applications must be seek exemption from

before commitment to use can be assumed.

3

Legend

Core

Organisational - all staff in the support pyramid(s) understand the key controls and SLAs around this application. There is no tinkering, instead there is a process for continuous improvement.

Organisational - Operations and security levels are to be maintained, there needs to be a process to manage changes required for continued operation, and to keep skills for the duration.

Consumer Service Management

Retire

Application - this is a fundamental and valuable application and is the current standard. It is well understood and there is no risk in attempting to extract ongoing value from its use.

An assessment of the overall Application Lifecycle status denotes whether an application is emerging, core, end-of-life, etc.

Contain - Falling relevance; ageing processes and ecosystem

After Sales Service

Human Resource Management (HRMS)

Usage & Governance – Projects may consider using these applications where there is justification. However projects must be aware that service management organisation, tools and processes will likely be immature. Projects promoting the use of “Invest” applications must seek adoption signoff from the Head of Infrastructure and Operations together with the Head of IT Strategy and Architecture before commitment to use can be assumed.

Financial - costs are known and understood. There is good ROI for maintenance; either upgrading early or leapfrogging some upgrade steps. Cost models clearly identify the whole service stack and components are managed to the whole service.

Field Management

Manufacturing (Info Tech)

Organisational - this will assist in supporting our organisational maturity goals through improving process, skills, readiness and/or capability. Design patterns are actively being developed or refined.

Core - High relevance; processes and ecosystem in place

1

5

PLM

Application - this application has identified potential to change the cost/value, efficiency/effectiveness of our services, and we are at a point where work is required to achieve that potential, proof of concept/ initial deployments are Underway or completed.

The Logical Architecture groupings create traceability back to the Capability Model.

Financial - there is an investment cycle with a strong ROI, though possibly with benefits outside of the immediate project.

Partner Management

Enterprise Resource Planning (ERP) Sales Order Management

Medium Business Fit

Medium Technical Fit

Customer Contain Service Management

Business Plan Optimisation

Materials Formulation & Products 5

3

Emerging

Supply Planning

Retire

Emerging - Potentially High relevance, processes and ecosystem still developing

Supply Chain Planning (SCP) Demand Planning

Core

Contain

Low Business Fit

1

Strategic Sourcing 4

Spaceman

Emerging

High Business Fit

Customer Sales Management

Operational Reporting 2

Legend

Customer Relationship Management (CRM) Customer Marketing Management

Enterprise Performance Management (EPM)

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The technical health of the application provides a simple indication of whether the application is stable and performing to SLA.

Mapping of Capabilities to Applications Current State and Target State Application Architecture views in ADOit

Transition Plan ?

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Transition Plan Capability Increments & Dimensions

Objectives

Capabilities

Capability Increments

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People Dimension

Process Dimension

Material Dimension

Individual Training

Concepts

Infrastructure

Collective Training

Business Processes

Information Technology

Professional Development

Information Management

Equipment

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Delivering Strategic Architecture Creating traceability from strategy to implementation

Application Portfolio View (Finance & Treasury Systems) Business Value vs IT Value 1.1

Upgrade Technology

Keep Maintaining Bloomberg

1

Navision SmartData Navision (Resource (Project Corporate Online ComBiz Costing) Costing) Online Austraclear Exigo

0.9

0.7

ACL Cashflow Reporting

0.6

Business Value

ProcureMax Navision (Assets) (AR) Visual Risk Business Median(PO) Navision

BAF

0.8

Navision (AP)

0.5 0.4

Navision Navision(Cash (GL) Management)

NemPower - NemFuture Procuregate

HED

FleetWatch

0.3 0.2 0.1

Leverage Technology

Retire or Replace 0 0

0.1

0.2

0.3

0.4

0.5

0.6 IT Value

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0.7

0.8

0.9 IT Median

1

1.1

The Roadmap Viewpoint Viewpoint Element

Description

Stakeholders:

Business Executives, Business Managers, Business SME’s, IT Executives, Portfolio and Programme Managers, Project Managers, Organisational Change Management

Concerns:

• How are my strategic objectives being realised through my architecture and program of work? • What are the changes between the current state and the future state of the architecture? • What is my current investment roadmap to achieve the required changes? • Where are the dependencies across the program of work?

View Description:

Provides a view of the amalgamated means to end chain describing the strategic capability direction for the organisation, and the associated transition plan required to realise the vision. The primary intent of the roadmap is to inform the detailed program of work. It is not the intent of the roadmap to be an executable program but a key input into the defining the detailed program of work.

Metamodel Concepts

Mission, Vision, Goals, Strategies, Objectives, Drivers, Assumptions Capabilities, Roles, Process, Logical application, Logical technology, Risk

Model

The EA Roadmap Model

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EA Delivery Roadmap

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An Overview of Roadmap

› The strategic context for the organisation. This looks to describe the program vision, goals, objectives.

› The outcomes of the program streams are mapped to the business objectives providing traceability from program initiatives to strategic objectives.

› Architecture principles provide rationale and context for the target state. › The strategic initiatives designed to realise the target state. Any cross- program dependencies are identified.

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The outcomes of the program streams are mapped to the corporate risk register providing visibility of risks addressed by the program.

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› The intended target state provides visibility of where the program will land. This section will demonstrate an increase in business capability and a simplification of the technology landscape.

Case Study & ADOit Tool Demo

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Case Study Goal: Create a global Operating Model balancing global capability with local agility › Global Professional Services firm with offices in many countries › Recent merger has created two ‘centres of gravity’ in London (North) and Sydney (South) › Replication across the IT estate, with examples of good and bad in both North and South territories › Need to find an approach that identifies common, shared capability (which can be backed up with investment in Global/ERP type systems) and local market ‘uniqueness’ required to address the needs of local clients (potentially enabled through local instances or market specific apps) › Business Motivation Model and Capability-driven planning were used to set goals and objectives at group level, evaluate options and gaps at global and local level and build a capability-driven roadmap » A core of common capabilities were identified providing the Global ‘footprint’ » Local market variations were evaluated at capability level » A roadmap was created to enable new and changed capabilities and to deliver the Global IT backbone Platform: Increase workflow by having E2E execution capability in key practices & markets

Clients: Build long term relationships

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Lead the Market: Become the leading professional services firm in APAC

Service Excellence: To focus our business on what matters most to our clients

Service Transformation Deliver business services that support the needs of a Global business

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Thank You www.enterprisearchitects.com [email protected]

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Our Locations

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References and Acknowledgments These people and ideas have helped shape our thinking › The Dimensions of Digital Disruption » Mark P McDonald, Gartner

› The Innovator’s Dilemma » www.claytonchristensen.com

› The Business Model Innovation Factory – how to stay relevant when the world is changing » Saul Kaplan

› Alexander Osterwalder – strategiser › Gartner Hype cycle for Enterprise Architecture 2013 › Customer CEO » Chuck Wall

› Digital Disruption – unleashing the next wave of innovation » James McQuivey

› Discipline of the Market Makers » Treacy & Wiersma

› The Business Motivation Model » Object Management Group

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