Business Technology Capability dualism was discovered in the previous post: While Assets form the capability foundation, Activities are needed to manage and develop the assets. Only with both pillars in place, technology-driven productivity gains become a reality.
Enterprise Architecture has been around for a long time with three distinct maturity levels. The first two are easy to recognize:
- EA as technical architecture covering the portfolio of IT assets
- EA as business architecture covering the portfolio of business capabilities
Maturity level 1 implies isolation of IT and business as Enterprise Architecture is not used to build bridges between the two. EA remains primarily CIO and IT department sandbox. It is clear that this is no longer competitive setup.
Maturity level 2 is the entry ticket to today’s competitive landscape. That is, level 1 is left to losers. Level 2 is about using EA to describe, communicate, plan, develop and manage business technology capabilities, including dependencies within and between assets and activities. EA provides important navigation aid to manage the ecosystem for capability creation and sourcing.
However, EA benefits are not limited to internal capabilities only as EA provides integration planning baseline for all customer solutions too. Furthermore, EA becomes central tool to roadmap BT capabilities from today’s “as is” towards future “to be”. In short, EA needs to be integral part of strategic investment planning and decision making.
But all this is still pretty basic. Where does the excitement come from? Answer: from EA maturity level 3.
Enterprise Architecture for Competitive Advantage
EA maturity level 3 does not yet have an established title. Here’s a suggestion:
3. EA as strategic agility enabler thru capability componentization
Here the capability components are bundles of three: 1) people with skills, 2) technology, and 3) processes and methods. These components need to be organised around people rather than technology or processes – they become component teams.
The team scope and mandate needs to be defined very carefully as the team becomes the accountable owner of the business problem in question. The mandate could be e.g. Online presentation of a product or Minimising energy consumption for unit produced.
People familiar with Microservices get the idea right away as microservice architecture organises web services around business capabilities like Order rather than technical capabilities like Database. Hence, EA maturity level 3 borrows heavily from microservices basic concept.
With accountability comes empowerment, diversity and long-term perspective. The first allows the team to choose solution details, e.g. technologies and methods deployed – whatever is available, within reason. The second refers to diverse and dynamic set of team skills consisting of expertise on product, data, software, technology and customer, depending on emerging needs. The third means that the component team is not short-lived task force but remain problem owner until controlled redirection, as applicable.
While EA level 3 is not revolutionary – it’s still fundamentally about business technology capabilities – it does introduce significant change to the perception of capabilities and their deployment. The principle of starting with empowered people has massive implications in terms of overcoming cultural inertia prevalent in many organisations in the context of digital transformation.
However, while the concept itself may not be revolutionary, its objectives are truly ambitious:
- to come up with industry leading solutions to carefully defined business problems
- to integrate and scale thru success stories and thru component team multiplication
- to launch new component teams to tackle emerging business problems head on
- to maintain leadership position thru continuous learning and improvement
Overall, this translates to strategic agility. With good set of competent and fast moving component teams and with established practise for new team launches, business renewal becomes natural part of daily operations and organisational culture. This is what winning business is made of.
Not surprisingly, Enterprise Architecture is firmly in the change management toolbox. As an initial step, it’s about getting to maturity level 2. Right after that, level 3 is targeted for transformation and agility – with competitive advantage always used as the North Star.