As companies work to adapt to a fast-changing business environment and increasingly complex technology landscape, leaders are taking a closer look at their enterprise architecture strategy to ensure their IT portfolio supports strategic business objectives. Done well, a strong enterprise architecture provides the foundation that enables companies to be more agile, scale new innovations quickly and securely, and ultimately deliver greater value to customers.
Creating a solid enterprise architecture strategy can help take product development organizations to the next level by providing the technological runway they need to create seamless customer experiences and respond quickly to market needs. Inside many organizations, however, we often find that enterprise architecture has not reached the level of maturity needed to deliver on those promises. Often, employees rely on patches and workarounds to get data from one system to another, time that could be spent working on product and system enhancements. In other cases, existing technology architectures no longer align with strategic business objectives. One of the main problems stemming from this lack of alignment is that it limits the capacity to create efficiencies and synergies that support business goals. It can also hamper business agility by making it more difficult to create and share relevant data and insights across the organization.
To overcome these challenges, firms need an enterprise architecture strategy that can adapt to changing market demands. That requires making EA an ongoing and evolving part of any digital transformation initiative.
Defining Enterprise Architecture
At its core, enterprise architecture refers to the configuration of IT resources in service of an organization’s business strategy. It creates alignment among a company’s strategic goals, its existing business processes, the data and information created, and the underlying infrastructure that supports it. It forms a blueprint of sorts, noting not only what technology the company currently has, but also how future technology investments will fit into or change what currently exists.
There are four main components of the EA:
- business architecture,
- data architecture,
- application architecture,
- and technology and infrastructure architecture.
We will explore each of these later in the article. These components cascade down from one another, each serving a different purpose (see image).
Having a clear EA does not magically solve business operations issues, nor does it enable a company to generate insights with a single tool. What it does is create vertical alignment of the business and functional objectives, foster collaboration between functions, and help create synergies based on data.
Why invest in your company’s Enterprise Architecture?
For many companies, the Enterprise Architecture is an afterthought, something only relevant to the architect who needs to give his or her sign-off during product feasibility meetings. But as mentioned above, the EA needs a seat at the table throughout the process to share guidelines and strategies with product development and IT teams that enable key growth levers. Among the reasons a clear EA is essential:
- It can provide a consistent experience, both from an employee and customer perspective. Designing an end-to-end enterprise architecture enables omnichannel integration, which can be translated into a more seamless customer journey.
- It enables the use of new technologies and simplifies integration. A well defined enterprise architecture streamlines the process for introducing cloud, automation, and the use of APIs, among other technologies. It helps drive a common platform and infrastructure that development teams can use to create products and services aligned to business objectives.
- It enables agility and flexibility to functions that use data to inform their decision-making. By aligning the data generated by the company and the tools used to collect that data, it becomes easier to automatically join, clean, and share data sets that enable supply chain, marketing, and operations teams to make decisions aligned to business goals.
Developing your EA strategy
There are four key components of any enterprise architecture strategy:
- Business architecture includes strategic business goals that will guide all efforts.
- Data architecture helps organizations understand what information each business function needs.
- Application architecture determines how to create, connect and provide data to those functions.
- Technology and infrastructure architecture encompass cloud services, security, and other tools that enable business applications to run effectively.
The first step in creating an enterprise architecture strategy is understanding the overall business outcomes an organization wants to achieve. The Objectives, Goals, Tactics & Metrics (OGTM) framework provides a useful framework for aligning business goals to the mission and vision of the organization, then tying those goals to specific operational tactics. You can read more about the OGTM framework here.
Once there is clarity about the organization’s path and desired outcomes, it is important to partner with business functions to help each understand their role in the company’s strategy. Conversations with functional leaders should focus on objectives, roadmaps and blockers, the functional leader’s needs, and which technologies support and enable their goals.
Discussions with functional leaders should also include how they use data to influence their processes and decisions. This creates a bridge between business strategy and data strategy and leads to understanding about how data will flow across and within the organization. In the age of artificial intelligence, it is important to discuss and set a direction for the use of tools and structures that enable the use of algorithms, automation, machine learning and eventually AI.
With an understanding of the overall strategy and functional objectives, as well as the data needed to execute business processes, technology leaders can determine the tools and applications that will best help the organization achieve its goals.
These tools may be internal, such as an employee lifecycle management tool. At the center may be an application that includes an employee’s personal information and is connected to recruitment and onboarding tools. That data may also connect to a learning management system (LMS) to track training and employee growth paths. Connecting all of these applications can, for example, allow HR team can generate valuable insights used by the management teams.
Applications may also be external, directly related to customer-facing products or digital channels. Say a financial services firm sells an application to help bank branches process customer transactions. If the firm also offers related products, such as mobile or web banking or fraud detection products, it is important that the different products work seamlessly and appear as a single system to the end user. A single application architecture can help influence requirements for user experience, product development, and operations teams.
When creating an application architecture, it is also important to understand the role that Application Programming Interfaces, or APIs, play within the business. APIs are the building blocks that ensure all systems can communicate and share data effectively. This is one of the most important, yet often overlooked, aspects of the product development process that needs to be addressed by your EA strategy.
Technology and Infrastructure architecture
Organizations first should assess whether the company has all of the technological components necessary to support the business tools and applications. This includes hardware and software that will enable these tools to be deployed, such as on-premise servers or cloud storage, networking, and security. When thinking through technology architecture, it is critical to consider how infrastructure will affect the organization’s agility and ability to grow.
Common challenges when establishing an Enterprise Architecture Strategy
There are different risks and challenges associated with the creation of an enterprise architecture strategy. Due to how quickly technology changes, it is very easy for systems, applications, and even entire methodologies to become obsolete in a short period of time. Combined with an inclination to go after the latest trend, it is particularly easy for the EA model to become outdated or to have changed by the time a standard version is in place. In this scenario, enterprise architects constantly play catch up and the strategy fails to deliver its real value.
Similarly, business teams may perceive architects as people sitting in an ivory tower, not tied to the reality developers face. As a result, developers may not see the value in creating documentation. Technology leaders, then, must constantly communicate the strategic importance of enterprise architecture in achieving both short-term and long-term business goals, and drive operational accountability for documentation across the organization.
Operationalizing the Enterprise Architecture Strategy
With a clear understanding of the business objectives, as well as the data, applications, and infrastructure that will help a company achieve its goals, technology leaders can create a roadmap for transforming the organization. That includes thinking through which frameworks and tools may be used to implement the new enterprise architecture. There are a number of EA management tools in the market that you can use to map all business capabilities to the strategy, as well as to the logical and physical infrastructure. Depending on an organization’s maturity, leaders may also opt to have more informal plans and architecture mapping, but it’s worth noting that this may inhibit the speed and effectiveness of implementation.
At the same time, it is important to frame EA as a light tool rather than an onerous process that only delivers documentation. When creating or improving an enterprise architecture, leaders should think through how EA teams will continue to add value by enabling new product development and creating new opportunities for innovation at scale.
Creating a comprehensive EA strategy is not a linear process, and it takes time and many conversations to go from an idea to full execution. The journey does not stop once the EA has been implemented, but rather is an iterative process that will change and mature over time as technology evolves and priorities shift.