Using Business Architecture To Drive Business Services

Using Business Architecture to Drive Business Services

David Baker

Chief Architect, Diamond Management & Technology [email protected]

March 28, 2007

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© 2007 Diamond.

What you can expect to learn

• A holistic service model for the enterprise

• Learn the different roles of technical services and business services

• Discover the impact your company‟s operating model has on the definition of services

• Explore the elements of a business architecture meta-model

• Learn how to use business architecture to identify business services

• Develop a strategy to engage your business counterparts in EA planning

• Use your EA blueprints to govern your service implementations

• Learn why an SOA business case is the wrong way to justify business services

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© 2007 Diamond.

But, aren‟t you really talking about SOA?

(short answer)

Yes, but…

(long answer)

SOA is a very broad concept and, as such, “services” are certainly an important sub-topic. My objective is

to describe how Business Architecture provides a way to document enterprise capabilities and the

services that enable those capabilities.

I am going to try to NOT say “SOA” again, no promise though

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© 2007 Diamond.

There is a continuum from Business Services to Technology Services

Presentation

Services

Enterprise Services

Business Services

Data Services

Infrastructure

Services

• Presentation: Describe how information is

captured and presented to the user consistent

with their role, function and level of authorization

• Business: Contain the logic and context

required to successfully execute a business

process by leveraging other available services

• Enterprise: Provide those business functions

which are common to multiple processes and

when executed produce a simple pass or fail

response

• Data: Access core data stores to retrieve or set

data grouped into logical objects

• Infrastructure: Provide technical services that

promote reuse of IT infrastructure

Te

ch

no

log

y F

oc

us

Bu

sin

es

s F

oc

us

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© 2007 Diamond.

Example: Financial asset management company –transfer agency function

Presentation

ServicesBusiness Services Enterprise Services Data Services

Infrastructure Services

Capture Data

Display Controls

Display Results

Account Set-up

Account Maintenance

Change of Trustee

Party Set-up

Party Maintenance

Search

Transaction

Apply Validation Edits

Monetary Transaction

Edits

Purchase

Redemption

Settlement

Generate Letter

Workflow

Conceptual Context Diagram - Not Exhaustive

Account Master

Get Account Information

Set Account Information

Get Transaction Info

Set Transaction Info

Product Master

Get Product Information

Dealer Master

Get Dealer Information

Workflow Repository

Get Routing Information

Get Workflow Info

Set Alert Timing Info

. . .

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© 2007 Diamond.

There is an „art‟ to distinguishing Business Services from Enterprise Services

Leading QuestionsBusiness vs. Enterprise Services

• Business Initiated Activity–Is the service something that would be a reason a

shareholder would call in? – Yes, Business Service–Can the service be incorporated into the business

driven processes? – Yes, Enterprise Service

• Reusability–In detailing the business processes, did the same

activity, function or task emerge repeatedly? –Yes, Enterprise Service

–Did a process or function appear to be an outlier, unrelated to others? – Yes, Business Service

• Scale–Do future state scenarios such as a new product

indicate an explosion in a particular type of business service? - Yes, Enterprise Service

–Would a service be a candidate for exposure through a new channel? – Yes, Business Service

• Localization–Would items like regulatory changes require updates

to a large number of services? – Yes, Enterprise Service

Enterprise Services

Business Services

Fulfills the

spirit of a majority

of the Business Service

led questions.

Fulfills the spirit of

a majority of the

Enterprise Service

led questions.

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© 2007 Diamond.

Five Zone Service Model

Infrastructure services contain the distributed, shared enterprise services for technical infrastructure

Infrastructure Service Examples

•Messaging

•Persistence

•Security

•Directory services

•Business rules

•Workflow engine

Five Zone Service Model

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© 2007 Diamond.

These are some likely Infrastructure Services for our Financial Services example

Presentation

ServicesBusiness Services Enterprise Services Data Services

Infrastructure Services

Sales Web

Security Services

e.g. SiteMinder

EAI Hub

Messaging

e.g. MQ

Account Master

Get Account Information

Set Account Information

Get Transaction Info

Set Transaction Info

Product Master

Get Product Information

Mutual Fund

Transaction

Apply Validation

Edits

Transaction Broker

e.g. WebSphere

Business Integration

Product

BoR

Purchase

Settlement

Log

Fail

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© 2007 Diamond.

How do you identify (and plan for) business services?B

usin

ess P

rocess In

teg

rati

on

Business Process StandardizationLow High

High

UnificationConsistent product design and

globally integrated processes for all

customers

Focus:

Centrally designed and managed

ReplicationFew shared customers with

operationally similar product units

Focus:

Replication of standard capabilities and

provision of APIs

DiversificationFew shared customers with

highly variable product design

Focus:

Localized development speed and

autonomy

CoordinationShared customers with highly customized

products, services, and features

Focus:

Integration capabilities

Source: Jeanne Ross (MIT CISR) - Enterprise Architecture as Strategy, Diamond.

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© 2007 Diamond.

The choice of operating model is reflected in the level of service standardization

Bu

sin

ess P

rocess In

teg

rati

on

Business Process StandardizationLow High

High Unification

ReplicationDiversification

CoordinationPrsntn

SvcsBusiness

Services

Enterprise

Services

Data

Services

Infrastructure Services

Prsntn

SvcsBusiness

Services

Enterprise

Services

Data

Services

Infrastructure Services

Prsntn

SvcsBusiness

Services

Enterprise

Services

Data

Services

Infrastructure Services

Prsntn

SvcsBusiness

Services

Enterprise

Services

Data

Services

Infrastructure Services

Partial StandardNot Std

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© 2007 Diamond.

Identification of operating model (and therefore services) must happen in the planning stage

Business

Strategic

Planning

IT Strategic

Planning

Release Planning

(Portfolio Mgmt)

ProjectExecution

(SDLC)

Business

Operations

Use enterprise and business unit

direction and goals to drive IT

plans

Develop projects that

support businesses’

annual and strategic

plans

Prioritize the allocation

of IT resources to

achieve business

strategy, in alignment

with enterprise

architecture

Run the

business

Portfolio 1

Blueprints

Portfolio 2

Blueprints

Portfolio 3

Blueprints

Enterprise

Blueprints

Filte

r

Project

Project

Project

Project

Project

Multi-Year Plan Budget Cycle Project Cycle Continuous

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© 2007 Diamond.

A business-capability driven blueprint is integral to planning for business services

Solution Architecture

Business Architecture

Technology Architecture

Desired Business Capabilities

Business

Strategy

Infrastructure Model

Interface

ModelInformation

Model

System

Model

Data

Models

App

Models

Development

Models

Execution

Models

Operations

Models

Network

Models

Security

Models

Business

Operations

Planning

Service Model

Building

Functional

decomposition is key

to identifying top level

Business Services

Business strategy and

capabilities are key to

identifying the

operational model

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© 2007 Diamond.

Engage the Business by documenting, and driving additional detail into, the business strategy

KE

Y D

RIV

ER

S &

GU

IDIN

G

PR

INC

IPL

ES

MISSION

VISION

GOAL GOAL GOALGOAL

PERFORMANCE

INDICATORS

CAPABILITIES

OBJECTIVE

A comprehensive statement covering the major functions and operations that the program addresses

An inspirational, forward-thinking view of what the program wants to achieve

The top priorities that would achieve the vision

A set of realistic outcomes tracked by performance indicators that collectively support goal attainment

A description of what the business needs to do to achieve the objectives

A description of how the capabilities should be implemented

REQUIREMENTS

Strategic Business Architecture

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© 2007 Diamond.

Engage the Business by documenting, and avoiding excessive detail in, the business operations

Bu

sin

es

s

Pro

ce

ss D

iag

ram

s

FUNCTION

SUB-FUNCTION

BUSINESS CONTEXT

STAKEHOLDER LOCATION

PROCESS / SUB-PROCESS

Bu

sin

es

s

Fu

ncti

on

al

Dia

gra

ms

TASK

Le

ve

l 0

Bu

sin

es

s A

rch

ite

ctu

re

Le

ve

l 1

Pro

ce

ss

De

sig

n

ORGANIZATION

Operational Business Architecture

Process design usually done AFTER a blueprint exists, as part of a funded project.

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© 2007 Diamond.

Business Context

Level 0 Functions == Business & Enterprise Services

Example: Our Transfer Agency example model expressed as a business architecture

Account Set-up Party Set-up Transaction

Transfer Agency

Purchase Generate Letter Settlement RedemptionApply Validation

Edits

Monetary Txn

EditsWorkflow

Business Architecture

(partial)

Solution Architecture

(partial)

Master Data == Data Services

Account Master Product

Infrastructure Services

Rules Engine Workflow Engine

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© 2007 Diamond.

A business architecture helps avoid common pitfalls when starting a service based architecture

• Start with operational model and capabilities, not requirements

– Requirements are good for implementation but bog down the planning process

– Capabilities provide a manageable level of detail for prioritization and release planning

• Start with functions, not with processes

– Process engineering requires a tremendous amount of detail

– Functions allow coarse-grained prioritization and justification for follow-on detailed process work

• Hold off on reference architectures until a couple blueprints exist

– Ensure you are working on the highest priority business and enterprise services

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© 2007 Diamond.

Business services require greater management maturity than technical services…

Technology

Services

Business

Services

Infrastructure Services

Such as:

- Single sign-on

- Standard ETL

- Messaging

- Logging

- Performance

Instrumentation

Data Services

- Create / Read /

Update / Delete

Master Data

Business &

Enterprise Services

- Business process

support

- Enterprise-wide

process support

SOA Management Maturity

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© 2007 Diamond.

… and increased complexity of the underpinning technology

Level 3:

Business & Enterprise Services

Level 1:

Shared Technology Services

Shared technology services centrally implement enabling technologies and tools that can be used by all other services and channels. These include but are not limited to workflow engines, translation services, business rules, and communication.

• Error Handling

• Logging

• Security

Integration services enable the

automatic synchronization of data

between operational systems using

a standardized application

integration approach. Integration

services also provide the

foundational architecture for

delivering business services.

A business service is an

implementation of a unit of work that

is well defined, self contained and

does not depend on the context or

state of other services. A business

service provides a distinct function

and has the following technical

characteristics:

• discoverable and dynamically

bound

• self-contained and modular

• stress interoperability

• loosely coupled

• network-addressable interface

• Service Registry

• Metadata Mgmt

• Service Aggregation

• Process Mgmt

• Instrumentation

• Data Access

• Robust APIs

Level 2:

Integration and Data Services

• Translation

• Transformation

• Request Routing

• Transaction

Mgmt

• Security

• Quality of

Service

• Monitoring

• Management

• Communication

• Infrastructure

• Version Resolution

• Extensibility

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© 2007 Diamond.

MIT Center for Information Systems Research (CISR) maturity model

Source: Adapted from “IT Leadership and Agility”, George Westerman, MIT CSR

• Capabilities build on other capabilities

• Ongoing service delivery is the required foundation for all other capabilities

• Expecting agility without having the other capabilities hurts performance

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© 2007 Diamond.

CIO/CxO relationship and Governance are key components enabling business services

Service

Management

Project

Delivery

Governance /

Alignment

CIO / CxO

Relationship

How will SOA impact your IT operations?

Similar impacts as moving to shared platforms (servers, etc)

Do you have the right skills to manage SOA?

Are your systems meeting expectations?

How should your IT delivery organization change to support SOA

How to economically deliver enterprise-wide services

Generating line of business (LOB) blueprints and business capability roadmaps

identifies Business and Enterprise services

How do you use architecture governance to ensure economical re-use?

How do you build the right service, at the right time, for the right cost?

How do you use Business Architecture to establish needed CxO / CIO rapport and

trust?

How do you transform IT to understand the desired business capabilities?

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© 2007 Diamond.

Develop a strategy to engage the business in service identification*

• IT must have a foundation of trust with the business

– Manage IT assets very well (high uptime, low unit cost)

– Help the business provide effective IT oversight (financial transparency, performance management, etc)

– Build and continuously enhance credibility and trust

• Importance of a unified IT operating model

– Establish clear business roles in planning, building, and running IT

• Business drives the need (and owns some services)

– Engage the business in THEIR priorities, model solutions using business architecture

– Establish a business function to own business/enterprise services

• Services cannot come before governance, project delivery, and these relationships

* Adapted from: “Business Agility and IT Capabilities”, George Westerman, MIT CSR from an analysis of 1400

responses to the Fall 2004 Gartner CIO survey

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© 2007 Diamond.

Services should be integrated with existing EA governance mechanisms

• Service governance should be integrated into existing EA governance

– Define a centralized application and architecture design review board

– Enforce consistent standards across development frameworks

– Enforce consistent implementation across applications

– Integrate review process with the IT operating model (plan, build, run)

– Define a centralized operations and architecture design review board

• Service specific technologies can assist the governance activities

– Share future state models via Enterprise Architecture repository

– Service repository

– Run-time monitoring

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© 2007 Diamond.

Neither business nor technical is a “SOA business case”

We need

services!

Engage the

Business

1st Business Domain

2nd Business Domain

Nth Business Domain

Build services

Build and deliver Infrastructure services

1st Business Services

2nd Business Services

Nth Business Services

Business-driven

business cases

for business

services

Cost-reduction /

avoidance business case

for infrastructure

services

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© 2007 Diamond.

Key Takeaways

• Adopt a holistic model for service identification

– Separate technical infrastructure services from business services

• Use Business Architecture methods to identify business services

– Engage the business to determine the prevalent operating model

– Helpful to identify business process specific services separate from enterprise-wide shared business services

• Realize the level of maturity required to reach business service delivery

– Ability to build and operate services

– Ability to govern identification, development, and use of services

– IT must have a foundation of trust with the business

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© 2007 Diamond.

Thank You

Questions?