Using Capability Modeling to Facilitate SOA Adoption

1May 22-24, 2007 Washington Dulles HiltonThe Business Transformation Conference

Chip WilsonChief Technology OfficerGeniant

Welcometo Transformation and Innovation 2007

The Business Transformation Conference

Four Domains of Enterprise Architecture

Why Business Architecture

• The forgotten stepchild ofEnterprise Architecture

• The least integrated of the four• The four domains are interdependent

• None should be defined in isolation• Necessitates a consistent approach to defining Enterprise

Architecture• Need for alignment between business and IT is merely an

alternative way of expressing this

• Too little effort has been put into creating a common model that encompasses all aspects of Enterprise Architecture

What’s Wrong with Business Process Modeling

• Represents how the business operates at a given time

• Documents and communicates howrather than what

• Processes change frequently• Optimizing for agility implies a desire to

facilitate change• Aligning IT with a business architecture

that changes frequently sets a company up for frequent changes in the IT architecture

What Should We Model Instead?

• Focus on what is accomplished• Business functions tend to remain

stable; underlying processes maychange radically and frequently

• Outcomes of processes typically do not fluctuate at all

• The level of abstraction where processesare defined by the purpose they serve

What Is This Approach Based On?

• A basis can be found in business literatureaddressing core competencies

• The competencies of the business are the what, regardless of how they are accomplished

• “Capability Modeling” is anemerging technique foranalyzing a business or industryand modeling it in terms ofthese competencies

Capabilities are the Building Blocks of Business

• Basic outcomes ofbusiness processes

• Encapsulate resources• People• Technology• Procedures• Other resources

• Joined together in networks to create higher level business processes

• Composed of processes built on lower level capabilities

Capability

Other Resources

People

Technology Procedures

Business Unit Capabilities

• Defines a business unit’s purpose• Provides a black box view• Hides internal implementation• A direct input to service design• Parallel black box approach

encapsulates a service’simplementation behind its interface

SOASOA

Capability Model Attributes

• Capabilities• Purpose• Service level expectation• Customers• Level of granularity

• Relationships• Boundaries

Levels of Granularity

• Multiple levels model the business in successively finer levels of detail

• Capability Rule of Thumb:• Coarse-grained enough that it remains

constant over time• Fine-grained enough that all

stakeholders understand it

• Relationships are as important to the Capability Model as the capabilities themselves• Dependencies between capabilities and the

information that passes between them• Indirect relationship via a higher level business process• Capabilities can serve in an oversight capacity,

governing execution of other capabilities• Capabilities can gather metrics on other capabilities or

in some way optimize their execution

Networks of Capabilities

The Business Boundary Defines The Value Chain

Company

Outsourced functions

The Physical Boundary Defines the Corporate Entity

Outsourced value chain functions

Environmental Capabilities

OperationalCapabilities

Everything outside the business boundary

XYZ, Inc.

Core CompetenciesDefine Strategic Capabilities

• Delineate core competencies(capabilities) from non-strategic capabilities

• Core competencies converge with physical boundary in an ideal business architecture• Retain core competencies within the

corporate entity• Outsource non-strategic capabilities

Capability BoundaryDefines the Interface

Outside the capability- Black box view of the capability- What it does rather than how it does it

Inside the capability- Implementation of the capability- Irrelevant to the capability model

Business Context Diagram

Business Boundary

Enabling Agile Business Architecture

Decouple business processes from IT systems

• Allow each to change independently from the other • Reconfigure rapidly to respond to a changing competitive

landscape • Evolve systems on their own lifecycle, without affecting

business processes

Enabling Agile Application Architecture

• IT systems must be decoupled from each other

• Allow each system to evolve independently of others

• Swap out entire systems without impacting dependent systems

• System interfaces must be decoupled from their implementation

Benefits of Decoupling

• Flexibility• Reduced IT development costs• Facilitates outsourcing non-core

competencies• Orchestrating services from multiple

systems enables business process automation

• Business analysts can implement newbusiness processes and automate existing processes

Benefits of a Single Point of Contact

• Consistent self-service experience for all• Keep systems and processes that provide

competitive advantage• External users receive self-service

environment designed specifically fortheir needs

• Improves employee visibility intocompany operation

• Facilitates collaboration between remote teams

Requirements for Success

Executive SponsorshipCommunication between Business and ITBusiness Focused IT

Executive Sponsorship

• An SOA adoption program needs appropriate sponsorship

• Requires a strong vision grounded in SOA best practices

• Must be led from the top down• Create a common vocabulary between

business and IT• Capability Modeling creates

tremendous synergies – aligns the entire Enterprise Architecture stack from top to bottom

SOASOA

Communication Between Business and IT

• IT must understand the strategic business direction• An ongoing dialogue on business process will:

• Provide a business context for Enterprise Architecture • Give the business community a suite of tools to automate,

improve, or even redesign business processes

• Business processes:• Are an important part of the alignment of IT and business• Should not be the basis for a common understanding

Ensuring IT is Business Focused

• The technical organization needs to:• Have a solid grounding in the company’s

history• Understand why the business operates

the way it does• Identify opportunities for greater efficiency

• Technical community must be willing and able to keep communication channels open to:• Keep abreast of the competitive landscape and

the operation of the business• Identify opportunities to leverage technology to

further business strategy

Adoption Process

• Enterprise Assessment• Current State – Identify

systems, processes and capabilities• Future State – Envision ideal

systems and capabilities• Gap Analysis – Develop a roadmap for

aligning the IT environment with the business objectives

• Implement the roadmap

Enterprise Application Map

Using Capability Modeling to Facilitate SOA Adoption

enterprise

business architecture

business focused

business operates

business

capability

processes

capabilities

Business

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