Enterprise Architecture Enterprise Architecture Value and Benefits Value and Benefits “ “ When it comes to When it comes to executing your strategy executing your strategy , , your enterprise architecture may matter far your enterprise architecture may matter far more than your strategy itself more than your strategy itself ” ” Enterprise Enterprise Architecture as Strategy Architecture as Strategy
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Enterprise Architecture Enterprise Architecture Value and BenefitsValue and Benefits
““When it comes to When it comes to executing your strategyexecuting your strategy, your , your enterprise architecture may matter far more than enterprise architecture may matter far more than your strategy itselfyour strategy itself” ” Enterprise Architecture as StrategyEnterprise Architecture as Strategy
Think ChangeWhat seems like only a ripple
today...Can become the wave of the
future
What is the Objective of EA within the What is the Objective of EA within the Organisation?Organisation?
• The objective is focused on the The objective is focused on the importance of the relationship importance of the relationship among goals and functions within the among goals and functions within the organisation, and the manner in organisation, and the manner in which these elements enable the which these elements enable the strategy.strategy.
EA Value1.Insight2.Guidance3.Compliance4.Governance5.Facilitation
Organisation
EA Value IdentifiedEA Value Identified• InsightInsight
– Enterprise Architecture can/should provide the business with deep, stakeholder Enterprise Architecture can/should provide the business with deep, stakeholder specific insight specific insight into how all components within the enterprise are related to each otherinto how all components within the enterprise are related to each other ,depend on each other ,depend on each other and function in a stable or possibly ineffective and/or inefficient state. and function in a stable or possibly ineffective and/or inefficient state.
• GuidanceGuidance– Following on from providing insight into the state of the enterprise and what is working and what Following on from providing insight into the state of the enterprise and what is working and what
is not working (well or viably), is not working (well or viably), Enterprise Architecture provides business with guidance to what Enterprise Architecture provides business with guidance to what needs or can be done to achieve viability or optimal state needs or can be done to achieve viability or optimal state (for the current understood desired (for the current understood desired state of the enterprise).state of the enterprise).
• ComplianceCompliance– Also directly linked with Guidance is the value in Also directly linked with Guidance is the value in providing a measure of compliance of the providing a measure of compliance of the
defined solution to the holistic Enterprise Architecturedefined solution to the holistic Enterprise Architecture, in the sense that it needs to be checked , in the sense that it needs to be checked that the proposed solution does not violate or deviate from the greater EA or that it cause conflict that the proposed solution does not violate or deviate from the greater EA or that it cause conflict with other areas or components of the holistic EA. It also provides a control to test viability of a with other areas or components of the holistic EA. It also provides a control to test viability of a solution prior to embarking on development of a proposed solution.solution prior to embarking on development of a proposed solution.
• GovernanceGovernance– It is something that happens so frequently, that what is being developed (or changed) deviates It is something that happens so frequently, that what is being developed (or changed) deviates
from the initial approved solution or spiral out of control due to a lack of an objective control from the initial approved solution or spiral out of control due to a lack of an objective control source. In that EA plays an source. In that EA plays an integral role in governing the project progress through staged integral role in governing the project progress through staged controls controls to ensure that the development stays compliant to the holistic EA, the project/change to ensure that the development stays compliant to the holistic EA, the project/change purpose (and requirements) and not break the budget either. purpose (and requirements) and not break the budget either.
• FacilitationFacilitation– Enterprise Architecture provided the initial view and what can/should change, so it should also Enterprise Architecture provided the initial view and what can/should change, so it should also
function as the tool to function as the tool to show where the implementation will impactshow where the implementation will impact, , where it should integrate and where it should integrate and what change management needs to take place.what change management needs to take place. A comprehensive, holistic EA should be a guiding A comprehensive, holistic EA should be a guiding tool to facilitate the smooth post development change implementationtool to facilitate the smooth post development change implementation
Graphical Representation of ValueGraphical Representation of Value
Eliminate
Reduce
Create
Raise
VIValue
Innovation
EA goes beyond Value Creation into Value EA goes beyond Value Creation into Value InnovationInnovation
Four Actions Framework – Creating Value Four Actions Framework – Creating Value InnovationInnovation
EliminateWhich of the
factors that the industry takes for granted should be
• Improved decision making • Increased standardization
• Improved innovation • Reduced complexity
• Improved management of IT investments
• Reduced costs
• Shortened cycle times
Categorisation of EA BenefitsCategorisation of EA BenefitsSource: (Niemi 2006), model applied from (Giaglis,Mylonopoulos et al.)Source: (Niemi 2006), model applied from (Giaglis,Mylonopoulos et al.)
What is the cost of deploying an What is the cost of deploying an EA?EA?
EA Value = EA Benefits – EA Costs
EA Cost = EA Benefits – EA Value
Therefore
What is the Cost of EA Benefits?What is the Cost of EA Value?Where Cost can be classified into direct and indirect costs
Calculating the ROI of Deploying Enterprise Calculating the ROI of Deploying Enterprise Architecture?Architecture?
• Quantify the Costs of:Quantify the Costs of:– Defining standards and guidelines.Defining standards and guidelines.– Preparing reference architecturePreparing reference architecture– Defining and maintaining IT roadmapDefining and maintaining IT roadmap– Governance activities.Governance activities.– ConsultancyConsultancy– Defining Strategy for moving from "as-Defining Strategy for moving from "as-
is" to "to-be" architectureis" to "to-be" architecture
• How much can we save by eliminating redundancy and How much can we save by eliminating redundancy and moving to shared IT services?moving to shared IT services?– Up to 40%, but probably 15% to 20% over the total costs for the Up to 40%, but probably 15% to 20% over the total costs for the
particular functional area of IT.particular functional area of IT.
• What type of savings can we expect from server What type of savings can we expect from server consolidation?consolidation?– Typically, 20% in terms of asset cost, but not necessarily any savings in Typically, 20% in terms of asset cost, but not necessarily any savings in
personnel costs that make up the entire TCO picture.personnel costs that make up the entire TCO picture.
• What type of savings should we expect from implementing What type of savings should we expect from implementing process models, such as IT Information Library?process models, such as IT Information Library?– Expect 20% to 30% of overall operating costs over three years.Expect 20% to 30% of overall operating costs over three years.
• What other IT initiatives have the potential to materially What other IT initiatives have the potential to materially reduce IT costs?reduce IT costs?
– Degree of reuse in application development —Degree of reuse in application development —– Extent and age of the applications portfolioExtent and age of the applications portfolio– Flexibility of IT staff (for example, the ability among IT personnel to take Flexibility of IT staff (for example, the ability among IT personnel to take
on various roles)on various roles)– Formality and quality of asset management processesFormality and quality of asset management processes
If you have one last breath If you have one last breath use it to say...use it to say...