There is a discussion of this article in the EA group on LinkedIn
At a recent Gartner Group
presentation the presenter estimated that between now and 2012 40% of Enterprise Architecture (EA) programmes will be shelved due to poor execution and that a major contributory factor to this will be a failure to effectively communicate the value of EA.
This is not a new problem for enterprise architects and IT architects in general (there are currently 10 widely used IT job titles that include the term architect). As someone who has always tried to use a "light-touch" approach to architecture and who’s job appears to many almost indistinguishable from staring into space, the importance of measuring and communicating value has always been forefront in my mind.
However, it is unusually hard to do this effectively across a wide audience. If EA initiatives are to succeed they must have buy-in at many levels in an organisation. At the recent TechEd EMEA in Barcelona
I was out one evening with a mixed group for drinks when a seasoned programmer rather colourfully confided to me that she really didn’t understand what architects did. [I paraphrase] "They just seem like self-important developers and managers who swan around being really up themselves." Now one could argue that this maybe down to the experience of the individual in question, the number of drinks in the individual at the time or that this represents an equal failure or unwillingness to understand, but if ever there was a failure to communicate value there it is in action.
Architecture is actually all about value. Not value in the ROI sense, which is both a difficult and dangerous way to measure EA, but in the sense of really driving out the best value from IT investments across the board. Good architecture is highly valuable because it’s role is to find and ensure the delivery of best-fit solutions to business problems. To ensure the accurate translation of business strategy and requirements into IT strategy and delivery and to achieve maximum leverage and reuse of existing assets. However, because these kinds of activities are largely orthogonal to business units, projects and service delivery their value in terms of ROI is difficult to measure and tends not to reflect their real value to the business.
The business spend in IT is broadly divided into three areas.
The Run Spend – operational costs of maintaining services
The Growth Spend – introducing new services
The Transformation Spend – restructuring existing services to better suit changing business needs
The bulk of EA and other architectural initiatives are concentrated in the second two areas (Growth and Transformation) and it is these areas that tend to be first in the firing line when cuts need to be made. However, without proper architectural focus it is very difficult to produce services with lower longer term running costs or ones that can more easily be transformed. So, the effect over time of reducing the spend on transformation and growth is that running costs increase, often cancelling out the short term gains of the cost cutting.
I have borrowed (and modified) this slide from David Chappell’s
excellent presentation at TechEd
about the Microsoft Application Platform.
His premise in this presentation is that the primary goal of business strategy is to create competitive advantage through differentiation. Key to creating this differentiation are custom applications on the basis that if you can buy something off the shelf it’s equally available to your competitors, almost certainly old news and therefore does not create competitive advantage.
However, over time, innovation becomes obligation and the value of that service decreases. The first provider to offer a given service gets the most advantage/value, the second less so and so on, up to the point where that service becomes so widespread that not providing it becomes a distinct disadvantage.
The strategic importance then of the application platform is that it should facilitate rapid and cost effective development and deployment of these differentiating applications in the key window of opportunity (C) and provide low operational costs over the longer term (B).
We can look at the strategic importance and value of EA in the same way. (B) is where the operational spend occurs while (A) is where the growth and transformation spend occurs and where much of the EA effort is focused. So we can see that the focus of EA is on delivering maximum value in (A) and creating architectures that will reduce costs in (B).
With a mature EA the lower operational costs have been achieved and much of the major transformation work is complete. Architecture has been created that allows for quicker, easier, cheaper transformation when required leading to greater agility, and maximum reuse and leverage of existing assets. This means that more of the overall spend can be used to achieve greater advantage in the growth area or the same growth can be achieved for less spend. As a result EA rarely has an ROI of its own, rather its value is found in improved ROI across a whole range of other initiatives.