Monday, February 25, 2013

Shared Vocabulary for Business Innovation and Modernization

Do you remember when computers were hard to use? In fact it’s just nine years since a GM press release asserted that if they developed technology like Microsoft, we would all be driving cars that for no reason at all, would crash twice a day, shut down and refuse to restart. Since then Apple has showed Microsoft the way, and we all use smart phones, tablets and PCs that are genuinely easy to use and remarkably resilient.

Because of this great leap forward in personal device usability the smart phone user on the proverbial Clapham Omnibus might reasonably expect that enterprise systems should be similarly easy to use and resilient. Unless of course she was a customer of the Royal Bank of Scotland (RBS), in which case she will have painful memories of last year’s high profile failure caused by the core banking system crash which corrupted tens of millions of accounts.

Once upon a time banks in general were regarded as leaders in the use of information technology. Yet last year several high profile systems failures signalled that banking systems, far from being leading edge, are in rapid decline. Banks aren’t the only culprits. Along with the banks, insurance companies, retailers and others are starting to offer their customers smart phone apps, notwithstanding that behind the scenes their enterprise systems are frequently held together with sticky tape and sealing wax.

The reason many enterprise systems are in such a poor state is commonly because there are three parties involved in managing the enterprise systems that have widely divergent goals and objectives. The line-of-business manager typically views the systems as support to the business process and a cost to be managed. The IT Architect views the enterprise systems as a set of capabilities that must be progressively modernized to support business innovation. The IT Project Manager is focused on delivering projects to time and cost.

These views are of course diametrically opposed. And under cost and time pressure the Architect is frequently the lower ranking player. In consequence the immediate needs of the business overrule longer term objectives of modernization, reduced complexity, flexibility and even cost of ownership.

The real issue is that the three parties do not have a shared view of the business problem. The line-of-business manager’s business process view does not correlate at all to the delivery project. The Architect should be the evangelist for business innovation and modernization but he or she is too easily squeezed in the cost and time discussion. And the Project Manager typically does not share the detailed technical project view with the line of business manager, and argues for a solution specific architecture that reduces project risk. The result is the existing enterprise systems get more complex and slower to respond to change. And the IT industry has been doing exactly this for as long as anyone can remember!

It’s extraordinary, but with all our high tech knowledge and skills we don’t have a vocabulary to articulate the business problem in a way that allows effective communications between the participants. Many IT organizations have embraced services as a way to organize systems capabilities more effectively. These might be Web Services or APIs or referred to collectively as Service Oriented Architecture (SOA). But, even if these software services are architected to align with business perspective, they are always managed as a technical matter, defined and managed by the IT organization.

Yet line-of-business managers do understand services as a business concept; virtually every business product today has a service component to it. The global service provider industry has formed around this idea, and in the UK today service industries account for 77 per cent of the economy. So while IT and business share the common underlying concept, at the practical level there is no meeting of minds.

In order to create a better bridge between business and IT we need to work with both the “how” and the “what” the business is, and we can do this by complementing business processes with business services. Business services are a very natural way to talk about “what” the business does today and tomorrow, while business processes focus on the “how”. Because you don’t reinvent an industry by just analyzing business processes, you also need to evolve and innovate with improved and new business services.

A good example of a service oriented business is Amazon.com Inc. They are well known as a service provider because they have constructed the Amazon enterprise as a set ofbusiness services which are offered to various external parties – enabling suppliers to sell second hand books or electronic goods on the Amazon platform; or providing data storage and Cloud computing services to other enterprises. The Amazon business services combine the compute and the business service integrating the commercial contracts, business processes, people, physical assets as well as the service interfaces that enable computer to computer or computer to device communications.
 Using a common business and IT concept permits sensible analysis of whether a service is just a unit of cost, or what the strategic value is now and in the future, and what it adds to the business value chain. Given so many line-of-business managers are thoroughly familiar with the very high technology in their smart phones and other devices, it really is time for IT to treat the business as a mature partner and for the line-of-business manager to take real responsibility for the business service as a whole product.

Increasingly we see a convergence of IT and business organizations. The business service concept is an essential piece of vocabulary to focus on a business innovation and get everyone singing off the same hymn sheet to potentially huge advantage of the business. Just look at the Amazon example!

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We will be running a workshop that explores these ideas in London in April in conjunction with the IASA UK Summit. If you can’t make the London event, (for geographic of schedule reasons) talk to me about how we can accommodate.

Monday, February 18, 2013

Framework for Service Oriented Ecosystem

I note interesting debates about the need for a next generation EA framework. However I am disappointed by the less than radical nature of debate that, at least I, have observed. I submit a good place to start is with the fundamental nature of business and how it is evolving and to consider what the enterprise of the future looks like. There are many indicators that we are entering a new phase of IT exploitation that will represent a real paradigm shift. Paul Krugman suggests IT is at last becoming significant, enabling a technology revolution to rival previous technology revolutions. Krugman cites driverless cars as an example of the technology moving into the physical world that has the potential to power growth. I will also instance a wave of disruptive technology delivering high bandwith always on connectivity for billions of workers and consumers, mobility, BYOD, social networks, big data and next generation analytics, robotics and Cloud. And the widespread adoption of Agile methods is also highly significant.

This stream of disruptive technologies is having a major impact on enterprises and the way they work. A Gartner report released this week predicts that by 2017, 25 per cent of enterprises will have enterprise app stores where workers can browse and download apps to their computers and mobile devices. I think that prediction will turn out to be conservative. It’s striking that many if not most enterprises are already being run as a continuous stream of initiatives, driven by business competitive pressures which in many cases are triggered by the disruptive technologies mentioned. And strategic innovation is typically being delivered in Agile projects which will increasingly combine business and IT expertise in defining the architecture and requirements.

But this is still a conventional view, doing what we do today, faster, better cheaper. What’s more importantly is to look at how the technology will enable profound change that spans existing enterprise boundaries. Consider Krugman’s Driverless Cars. This revolution is set to change the shape of personal transport in the relatively near term and will involve capabilities such as telematics, insurance, road tolling, mapping, navigation, vehicle recognition, which span car manufacturers, the financial industry, local or state government, emergency services and so on. This is a new ecosystem in the making which will require near real time, collaborative services spanning multiple business sectors.

Is this driverless cars ecosystem an isolated revolution? I don’t think so; consider smart shopping which is already taking off like a rocket with showrooming, or the extension of mobile devices to sector specific applications such as drug testing, health monitoring. I could go on. The future is going to look like many, many ecosystems, rapidly evolving usually not in the control of a single enterprise.

So returning to the question about a next generation EA framework, we might put a few stakes in the ground:
1. The pace of change is increasing so fast that conventional approaches (frameworks) for modelling will be left behind.
2. Ecosystem architecture should be primarily about identifying how an enterprise leverages an ecosystem by providing capabilities and their business services that collaborate and evolve along with the wider landscape.
3. The future is “business service” oriented. The application is dead. Business Service Implementation would be a better term.
4. The Capability and Service architecture will be a strategic business asset.
5. Capabilities as highly independent units of business function will be the way the business is organized.
6. The primary task of enterprise architects will be to develop the Capability and Service architectures as part of the business design.
7. Enterprise architects will probably be renamed Capability and Business Service Architects and report to the CMO.
8. The framework scope must span the entire Agile life cycle. Architecture is no longer a top down precursor to delivery, it must be an evolving set of deliverables and inherently implementable. The framework therefore needs to support concurrent development of business requirements, ecosystem, service and solution architecture, modernization, plus service and solution specification and delivery.

What’s needed is a new framework that recognizes the enterprise itself is a series of overlapping business ecosystems that are in turn part of a series of ecosystems that transcend the scope of the enterprise itself. A new framework should be focused on the capabilities and their inter-connections and manage the development of the business ecosystem(s) to the advantage of the enterprise.

While Capability is a widely used concept, notwithstanding some significant divergence of definition, the missing link is the realization of the Capability. In our work we use the Business Service concept – which delivers the capability in a context free manner. It’s extraordinary that our business vocabulary doesn’t include the formal Business Service concept in the same way that we are able to talk unequivocally about Business Process and know we will be understood.

The core model underlying the framework for future business needs to be service oriented, but it’s essential that the model is fully integrated with business concerns, and enables an implementable architecture in a way that current EA models manifestly do not. The new framework is also highly supporting of Agile methods in the entire life cycle being lightweight, twin track, narrow scope based on the Capability and Business Service, and contract based dependencies.
We will be running a workshop that explores these ideas in London in April in conjunction with the IASA UK Summit. If you can’t make the London event, (for geographic of schedule reasons) talk to me about how we can accommodate.

Paul Krugman: We Are On The Brink Of A Technology Revolution That WillTransform Our Economy