Maximising The Value and Benefits of Enterprise Architecture

Alan McSweeney

Objective

To explain the benefits of implementing Enterprise Architecture and to identify how the value of Enterprise Architecture can be measured

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Agenda

Enterprise Architecture Issues in IT Why Enterprise Architecture Enterprise Architecture Measurement Framework Enterprise Architecture Value Measurement Programme

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Basis for Enterprise Architecture

IT systems are: Unmanageably complex and costly to maintain Hindering the organisation's ability to respond to business and economic changing environment Not integrated

Mission-critical information consistently out-of-date and/or actually incorrect A culture of distrust between the business and technology functions of the organisation Unmanaged complexity in IT landscape leads to greater cost and less flexibility Issues include lack of standards, redundant applications, multiple platforms, and inconsistent data Enterprise architecture defines a set of tools and methods to address this complexity While benefits of Enterprise Architecture are generally understood, measuring value has been a challenge

No easy answer but Enterprise Architecture approach is really worth considering as a means of addressing these issues systematically

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Enterprise Architecture Is/Does

What the organisation does today in terms of IT What the organisation wants to do in the future in terms of IT The Information Technology assets implemented today The Information Technology assets the organisation needs to have in the future to best deliver its business goals Defines the framework outlining the vision for systems and technology for the organisation Takes the business strategy and translates it into effective change of the organisation Manages the Information Technology change roadmap Defines a set of overall principles, a future state vision and an implementation and transformation plan Includes standards definitions and strategies for servicesDecember 4, 2010 5

Scope and Elements of Enterprise ArchitectureEnterprise Architecture Business Architecture Information Architecture Enterprise Enterprise IT Information Systems Security Architecture Architecture Enterprise IT Technology Infrastructure Architecture Enterprise Architecture Governance Solution Architecture

Enterprise Information Technology Architecture

Software Architecture Network and Communications Architecture Storage ArchitectureDecember 4, 2010 6

Key Messages Relating to Enterprise Architecture

IT-business alignment has never been so important Alignment must be pursued in the context of understanding business processes and priorities Service-orientation is not just for applications Service contracts are not just about function: they encapsulate and communicate business priorities to IT delivery organisations Enterprise architecture needs to be more inclusive, sophisticated, flexible and integrated IT governance models must take all this into accountDecember 4, 2010 7

IT Too Often Fails to Support Changes Effectively

Technology integration is costly, risky and complicated Information is everywhere but getting access to the right information at the right time is very difficult Modifying system behaviour takes too long and changes are difficult to communicate and implement effectively Much of IT system and operations expenditure is bloated and fixed where operations run with excess redundant capacity IT seen as a cost centre and not a source of business value

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Business View of IT

IT is viewed by the business as being Expensive Not connected with business strategy and operations Unresponsive to the changing needs of business Viewed as a critical issue as business agility and responsiveness are essential for competitiveness

Undefined and unclear as a business asset In terms of financial cost and value Return on investment and value for money from IT is relatively poor The capability the asset should deliver to the business

Not delivering its promises Business change projects cost more and deliver less value than expected or promisedDecember 4, 2010 9

Causes of Business View of ITBusiness applications tend to be implemented on a project by project basis for specific purposes without overall context Project benefits and success have been measured on specific project costs, value and time to market without measuring the long term enterprise-wide cost and value Average 75% of total IT budget on RTB operations and 25% on new project investment Technology innovation has tended to deliver specific shortterm benefits but in the long term of making things worse Just look at previous technology innovations such as client/server and 4GLsDecember 4, 2010 10

Business Pressures on Information TechnologyGlobalisation Business and Technology Changes

Transparency

Information TechnologyRegulation Service Focus

Consolidation

Challenging Economic Circumstances11

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Business Pressures are Driving Business and IT Change

Globalisation Customers, partners, suppliers and greater competition Connectedness driving value chains

Transparency Industry regulations, consumer pressure and competition driving openness

Service Focus Differentiation and shareholder value increasingly derived from service experience

Challenging Economic Circumstances Need to cut costs and demonstrate real savings Justify technology investments

Consolidation Mergers, acquisitions, takeovers of failing companies

Regulation Increased regulation and governance - business is turning to IT to help and IT struggling to respond in many cases

Business and Technology Changes IT becoming commoditised - growth of standards-based technology means that proprietary solutions provide less differentiation Speed of technology change Outsourcing where the right outsourcing decisions require an understanding of how systems contribute to the businessDecember 4, 2010 12

Why Enterprise Architecture

Enterprise Architecture is part of a continuum and not a project Emerging technologies influence direction of architecture Must be subject to change management and governance Enterprise Architecture and IT governance should be considered together

Principles of architecture should override IT hype and transient technology SOA may be dormant but services and an architectural component continues Cloud computing is just another step along the IT/Architectural evolution and another perspective on the future state

Need better understanding of integration of enterprise and solutions architecture Enterprise Architecture is about achieving a common language between business and IT Enterprise Architecture driven out of the business strategy provides the enterprise with the highest degree of alignment between the business and IT The concept of Enterprise Architecture has expanded well beyond the traditional notion of technology architecture Now the architecture of the whole enterpriseDecember 4, 2010 13

Enterprise Architecture - Achieving a Common Language Between Business and IT

IT-business alignment requires collaboration between the business and the IT organisation to align investment and delivery with business goals and to manage business and technology change A common, agreed representation of business activity and goals A common, agreed view of how current and future IT provides structured support to the business Key requirements and deliverables: Investment prioritised in terms of business need Systems that deliver value to the business Clear direction from the business about focus, strategy Collaborative approach to implementing business change

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Enterprise Architecture and Strategy

Provides the fundamental technology and process structure for an IT strategy Provides a strategic context for the evolution of enterprise IT systems in response to the constantly changing needs of the business environment Allows individual business units to innovate safely in their pursuit of competitive advantage within the context of an integrated IT strategy Enterprise Architecture is designed to ensure alignment between the business and IT strategies, operating model, guiding principles, and the software development projects and service delivery By taking an enterprise-wide, perspective across all the business services, business units, business processes, information, applications and technology, Enterprise Architecture ensures the enterprise goals and objectives are addressed as a whole way across all the system acquisition/application development projects and their deployment into production Organisations use a business strategy driven architecture approach that focuses on translating the key components of the business strategy into a future state vision and an architecture road map they can implement Enterprise architecture is integrated with other strategic planning disciplines, such as programme/project and application portfolio and management Enterprise Architecture ensures that the long-term vision of the business is preserved as the enterprise builds new business capabilities and improves on old ones

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Why Manage Enterprise Architecture?Unmanaged Complexity in IT Landscape Increased Cost Duplication in Resources to Develop, Operate and Maintain Business Systems Cannot to Exploit Economies of Loading and Scale

Leads To ..

Reduced Flexibility

Delays in Delivering Changes

Complexity Causes Difficulties and Uncertainties

Thus Negatively Impacting on Business Performance December 4, 2010

Longer Design, Build, Test and Delivery Time

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Why Manage Enterprise Architecture? To Address This Complexity

Provides a Set of Tools and Methods

ProvidesNeed to Measure Effectiveness of Enterprise Architecture In Order to Maximise Business Value17

ButEnterprise Architecture

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Value of Enterprise ArchitectureAppropriate and Effective Enterprise Architecture Promotes Actions and Decisions That Align Information Technology Plans and Investments with Business Priorities and Requirements Result in More Integrated Operations Responsive to Customer and Business Requirements Promote a More Efficient and Effective IT Infrastructure Facilitate Cross-Organisational Sharing of Enterprise Information Recognise Innovations and Best Practices Across the Enterprise Ensure Traceability of Decisions Back to Principles and RulesDecember 4, 2010 18

Enterprise Architecture Development and Implementation ProcessArchitecture Vision Architecture Change Management Business Architecture Data Architecture Implementation Governance Requirements Management Information Systems Architecture Solutions and Application Architecture Migration Planning Opportunities and Solutions Technology Architecture

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Key Elements/Subsets of Enterprise Architecture

There are four key architectural subsets of an overall enterprise architecture Business/Business Process Architecture - this defines the business strategy, governance, organisation, and key business processes Data and Information Architecture - this describes the structure of an organisation's logical and physical data assets and data management resources Solutions/Applications Architecture - this kind of architecture provides a blueprint for the individual application systems to be deployed, their interactions, and their relationships to the core business processes of the organisation Technology and Infrastructure Architecture - this describes the logical software and hardware capabilities that are required to support the deployment of business, data, and application services and includes IT infrastructure, middleware, networks, communications, processing, standards, etc.

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Issues in Key Elements/Subsets of Enterprise ArchitectureBusiness and Business Process Architecture

High variability and lack of standardisation across business units (such as ERP templates), driven by changes in business strategy, governance, organisation and process Inconsistent data definitions, multiple databases, releases and configurations which result in duplication of licenses, duplicate and inconsistent information, complexity in testing Multiple vendors, multiple instances and versions which add complexity in procurement, development and release management, resulting in higher costs and longer time to market Multiple operating environments, multiple hardware vendors and types, leading to higher maintenance and personnel costs, greater instability and time-to-fix

Data and Information Architecture

Solutions and Applications Architecture

Technology and Infrastructure Architecture

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Benefits of Enterprise Architecture

Align IT and business for planning and execution purposes Optimise resources - technology, people and processes Increase business interoperability Reduce complexity in IT infrastructure Improve business agility to support dynamic change Drive re-usability of architecture models and best practices Streamline informed decision making Standardise IT for cost effective delivery of services Eliminate duplication and redundancy and reduce cost of ownership and return on investment Reduce risks for future investment Faster, simpler and cheaper procurement Manage information/data and knowledge as a corporate asset Manage change based on a clear understanding of its impactDecember 4, 2010 22

Risks of No Enterprise Architecture

Inability to rapidly respond to challenges driven by business changes Lack of commonality and consistency due to the absence of standards Lack of focus on enterprise requirements Lack of common direction and savings due to synergies Incomplete visibility of the current and future target enterprise architecture vision Inability to predict impacts of future changes Increased gaps and architecture conflicts Dilution and dissipation of critical information and knowledge of the deployed solutions Rigidity, redundancy and lack of scalability and flexibility in the deployed solutions Lack of integration, compatibility and interoperability between applications Complex, fragile and costly interfaces between applications Fragmented and ad hoc software development driven by a tactical and reactive approachDecember 4, 2010 23

Issues in Developing Enterprise Architecture

Issue 1 - Concentrate on the Plan Focus too intently on analysis and strategy Avoid committing to implementing solutions Architecting inhibits value delivery

Issue 2 - Jumping to the Solution Engineering solutions and data implementation Technology has difficulty aligning with enterprise Reinforces gap between business and IT

Challenge is to balance evolving strategy, goals, constraints with technology solutions

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Justifying Investment in Enterprise ArchitectureInvestment in Enterprise Architecture

Involves Challenges Longer Term Payback than Other IT Investments Reasons for Technical Decisions Difficult to Communicate Impact of Investment in Enterprise Architecture Difficult to Measure Different Investment Approaches Needed Across Enterprise Architecture

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Risks Inherent Investment in Enterprise Architecture

Enterprise Architecture Investment SpectrumToo Little or On Wrong Areas Means Operating Costs Increase as Architecture is Too Complex, Ineffective, Old and Expensive to Operate and Support Investment in Enterprise Architecture is Sufficient to Deliver Results Without Imposing Unnecessary Restrictions or Overhead Too Much Means Enterprise Architecture Inhibits Flexibility and Imposes Too Many Constraints IT Becomes Inefficient

Goldilocks ZoneDecember 4, 2010 26

Enterprise Architecture and Enterprise Architecture ManagementEnterprise Architecture Enterprise Architecture ManagementProvides the models and practices for defining, planning and managing the business and IT capabilities Includes business, data, applications and technology models and principles that support assessments and investment trade-off decisions, as well as tactical, project-level designs and decisions27

Defines a framework outlining the vision for systems and technology for an organisation Defines a set of overall principles, a future state vision and a transformation plan Include standards definitions and strategies for individual IT servicesDecember 4, 2010

Relationship Between EA Implementation and Operation ComponentsFunction Develops EA

Enterprise Architecture

Enterprise Architecture Function/ Capability Function Implements EA

EAM Measures and Manages the Extent and Operation of the EA and Provides Governance

Enterprise Architecture Management

Enterprise Architecture Implementation and Operation

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Outcomes of Effective Enterprise Architecture Implementation and Operation

Specification application architecture requirements Definition of architecture methodology Standardisation of information elements shared between systems Modeling of information relationships and lifecycles Deployment integration infrastructure Standardisation of hardware and core software platforms Building of reusable application components

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Enterprise Architecture Linked to Overall Business StrategyBusiness Processes Business Systems

Business Strategy

Business Objectives

Business Operational Model

Enterprise Architecture

Solution Delivery

Service Delivery

Enterprise Architecture aligns business strategy, business processes and IT and provides governance to ensure business value and competitive advantage is delivered Enterprise Architecture creates alignment, consistency and unity between objectives at various levels

Domain Architecture

Project Architecture

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Enterprise, Domain and Project ArchitecturesOverall Business Strategy and Objectives Enabling IT Projects

Enterprise Architecture defines and manages overall organisation architecture Domain Architecture(s) are subsets of Enterprise Architecture to enable individual business unit/domain objectives and targets to be met Project Architecture(s) enable project level objectives to be met31

Enterprise Architecture

Individual Business Unit Objectives

Enabling IT Projects

Domain Architecture

Project Architecture

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Enterprise Architecture Capability

The function that enables an organisation to create, adapt, enforce and develop enterprise architecture Equally a part of the business as it is part of IT Role is as much about controlling and focusing IT expenditure as it is about identifying necessary change

Ensures that the IT landscape is aligned to the business vision and continues to be aligned to the business strategy and operational needs Ensures that IT solutions can continuously react to the changing needs of the business Ensures that the business and financial case for change is madeDecember 4, 2010 32

Subsets of Overall Enterprise ArchitectureBusiness and Business Process Architecture

Technology and Infrastructure Architecture

Data and Information Architecture

Application And Solution Architecture

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Layers of Enterprise ArchitectureOverall Enterprise Architecture Context, Security, GovernanceBusiness and Business Process Architecture Conceptual View Defines What Is Required Data and Information Architecture Solutions and Applications Architecture Technology and Infrastructure Architecture

Business and Shared Services

Information Services

Application Designs

Overall Network and Infrastructure Design Infrastructure Services and Components

Logical View How It Should Be Implemented

Business Processes Designs

Data Sources, Targets and Flows

Business Applications

Physical View Defines What Should Be ImplementedDecember 4, 2010

Business Processes

Database and Message Designs

Application Designs, Specifications

Technical Designs and Specifications34

Enterprise Architecture Management

Enterprise Architecture needs be a guided strategy that is aligned with the needs of the business Enterprise Architecture Capability enables an organisation to create, adapt, enforce, and develop its technical architecture Enterprise Architecture Management provides a means to measure the effectiveness of Enterprise Architecture and assist organisations increase business value delivered by IT systems Enterprise Architecture Management is a capacity rather than a programme or an end state architecture Enterprise Architecture Management provides a capability model with maturity levels for an organisation to achieve desired level of Enterprise Architecture maturity and value Enterprise Architecture Management provides a systematic coherent approach to defining, planning, and measuring an organisation's IT assets over timeDecember 4, 2010 35

Why Invest in Enterprise ArchitectureEnable Greater Business Agility and Flexibility

Increased Business Value

Enable faster and easier collaboration through application and data integration

Enable faster response to business changes and new demands at lower cost

IT projects will have a greater success delivered on time, on Increase Use budget and to user of IT requirements reducing cost through avoidance of reworkIncreased Success in Solution Delivery

Solutions will be delivered at lower implementation and operational costs

Reduced IT Costs

Reduced IT CostsDecember 4, 2010 36

Why Invest in Enterprise Architecture

Business cannot understand why relatively straightforward business changes are costly, risky and slow to implement Run The Business improvements and Change The Business initiatives are restrained or prevented by the IT function because to the delay and high cost of implementing changes Lack of Enterprise Architecture means operational and support costs of solutions are kept high Reduces budget available to be used elsewhere

Solution Lifecycle Costs

Solution Implementation Costs

Post Implementation Costs Support, Operation

Situation worsened by projects attempting to deliver in an isolated fashion to bypass inhibitors resulting in further constraints for subsequent projects in the medium term

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What Manage Enterprise Architecture Value?

Understand the current state of Enterprise Architecture Create an accurate view of the current capabilities Define the activities to be worked on in partnership with the business Create a flexible Enterprise Architecture framework that will govern future initiatives

Validate Opportunities to Create Business Value Define the initiatives that will create the most value Define a realistic and achievable set of objectives Define value measurement to justify commitment and investment

Develop a a Flexible Initiative and Project Portfolio Define the set of initiatives and projects that achieve objectives Positively vet programmes and projects for value Create programmes of work that are justified, measured and managed for value

Recognise that Enterprise Architecture is strategic rather than tactical Requires the participation in partnership of business and IT Reach of Enterprise Architecture may extend beyond the organisation

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Framework for Enterprise Architecture Management

Framework provides a means for assessing the Enterprise Architecture maturity level within an organisation Can be used to achieve a target level of organisational Enterprise Architecture maturity and therefore value Provides a means for continuously assessing and adjusting Enterprise Architecture efforts Development of Enterprise Architecture needs be a focussed and managed strategy aligned with the business

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Using Enterprise Architecture Management Framework

Define the scope and role of Enterprise Architecture and its management within your organisation Understand your current capability maturity level Systematically develop and manage key capabilities for effective and appropriate enterprise architecture management that adds business value Evaluate and manage progress over time using a consistent set of value-oriented metrics

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Using the Enterprise Architecture Management FrameworkDefine the scope and role of Enterprise Architecture and its management within your organisation Measure and understand your current capability maturity level

Evaluate and manage progress over time using a consistent set of valueoriented metrics

Systematically develop and manage key capabilities for effective and appropriate enterprise architecture management that adds business value

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Dimensions of Enterprise Architecture Management Framework

Measure state of Enterprise Architecture along three dimensions Practices Planning People

Enterprise Architecture Practices

Define facets of each dimension Measure each facet in terms of: Associated processes and their state of development Scope or extent within the organisationDecember 4, 2010

Enterprise Architecture Planning

Enterprise Architecture Personnel42

Measurement of Value of Enterprise Architecture

Direct link between Enterprise Architecture and real value can be difficult to demonstrate There is a time lag between implementation and results

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Measurement of Value of Enterprise Architecture

Define Enterprise Architecture value measurement areas Identify measurement process Measure Establish current baseline Define target Measure results against baseline and target

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Measurement Framework for Enterprise Architecture ManagementEnterprise Architecture Management Framework EAM Dimension 1 Enterprise Architecture Practices EAM Dimension 2 Enterprise Architecture Planning EAM Dimension 3 Enterprise Architecture Personnel 3.1 Organisation Structure and Skills

1.1 Architecture Framework

2.1 Strategic Planning

1.2 Architecture Processes

2.2 Architecture Planning

3.2 Communication and Stakeholder Management

1.3 Architecture Governance

1.4 Architecture ValueDecember 4, 2010 45

Measurement Framework for Enterprise Architecture ManagementArchitecture Framework Enterprise Architecture Practices Architecture Processes Architecture Governance Framework of standards, templates and specifications for organising and presenting business and technical architecture components Methodology for defining, developing and maintaining architecture components Principles, decision rights, rules and methods to drive architecture development and alignment in the organisation

Architecture Value Defining, measuring and communicating the value and impact of architecture to the business Enterprise Architecture Planning Strategic Planning Using architecture principles and blueprints to align business needs with IT capabilities, define portfolio strategy and direction and allocate resources Architecture Planning Defining vision and roadmap for various IT domains by anticipating business needs and trends, and developing architecture components

Organisation Defining, planning, and managing roles, responsibilities and skills for Structure and Skills architecture management Enterprise Architecture Communication and Stakeholder Management Managing communication and expectations with business and IT stakeholders interested in or influenced by architecture management46

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Measurement Framework for Enterprise Architecture Management

Measure in terms of Processes those processes associated with Enterprise Architecture Management and their state of development how well-defined and effective are the processes Reach - scope or extent of Enterprise Architecture Management within the organisation how widely used

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Enterprise Architecture Management Assessment FrameworkProcesses are Optimised, Flexible, Adaptable and Lean Processes are Managed and There is Continuous improvement Processes are Repeatable and Consistently Used Across Teams and Projects Basic Processes and Associated Collateral in Place

Enterprise Architecture Processes

Ad-Hoc Processes Defined and Driven by Individuals Across the Organisation, Including Business and IT Functions Beyond the Organisation (Suppliers, Partners, Customers)48

Within Individual Projects

Within an IT Domain

Across the IT Function

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Enterprise Architecture Reach

Detailed Measurement Framework for Enterprise Architecture ManagementEnterprise Architecture Management Framework EAM Dimension 1 Enterprise Architecture Practices EAM Dimension 2 Enterprise Architecture Planning EAM Dimension 3 Enterprise Architecture Personnel

1.1 Architecture Framework

2.1 Strategic Planning

3.1 Organisation Structure and Skills

Processes1.2 Architecture Processes

Reach

Processes

Reach

Processes3.2 Communication and Stakeholder Management

Reach

2.2 Architecture Planning

Processes1.3 Architecture Governance

Reach

Processes

Reach

Processes

Reach

Processes1.4 Architecture Value

Reach

ProcessesDecember 4, 2010

Reach49

Complete Measurement FrameworkProcesses

Three dimensions x two aspectsEnterprise Architecture Personnel

Enterprise Architecture Planning

Processes

Reach

Processes

ReachEnterprise Architecture Reach PracticesDecember 4, 2010 50

Enterprise Architecture Management MaturityLevel 1Strategic Planning None

Level 2Project-based Limited vision and roadmap Central architecture fund Limited framework covers some information Defined processes primarily focused on infrastructure Some review principles defined for some components

Level 3Prioritization of project portfolio based on roadmap Architecture planning process established Funded from efficiency gains

Level 4Architecture a key input to joint Business / IT planning Continuous improvement Funding by margin on services

Level 5Business / IT planning enables efficiency, agility in extended enterprise Includes extended enterprise capabilities Funding by transaction

Planning

Architecture Planning

Project-based Project-based allocation

Architecture Funding

Architecture Framework

None

Covers Information and Consistently adopted process, but adoption not internally consistent Defined processes across IT domains Defined processes across business and IT domains Shared governance model with Business and IT Defined and measured business objectives, performance metrics Clear professional career track Pro-active communication and feedback with business

Framework shared externally Defined processes with clear ability to adapt and extend Business / IT governance continuously improved to respond to change Business outcomes and IT performance metrics Pro-active development with external input

Architecture Processes

Project-based processes

PracticesGovernance None / projectbased

Defined IT governance boards and processes

Value and Measurement

None / projectbased No roles, responsibilities

IT cost metrics

IT cost performance metrics Formalized roles and responsibilities

Organization Structure and Skills

Formal technology roles within projects

PeopleCommunication and Stakeholder ManagementDecember 4, 2010

Project-based

Key stakeholders identified and informed

Regular consultation with business

Collaboration with extended enterprise51

Assessing Current and Future Desired Architecture Management Maturity1 - Ad-Hoc 2 - Defined 3 - Repeatable 4 - Managed 5 - Optimised

Architecture Framework Enterprise Architecture Practices Architecture Processes Architecture Governance Architecture Value Enterprise Architecture Planning Strategic Planning Architecture Planning Organisation Structure and Skills

Enterprise Architecture Communication People and Stakeholder Management Current EA Competency Maturity LevelDecember 4, 2010

Desired Future EA Competency Maturity Level52

Measuring Maturity and Importance

5.0

4.0

Level Of Maturity3.0

Organisation Structure and Skills

Architecture Processes

Architecture Value 2.0 Architecture Governance 1.0 1.0 2.0 3.0 4.0 5.0 Architecture Framework

Architecture Planning Communication and Stakeholder Management

Strategic Planning

Level of ImportanceDecember 4, 2010 53

Benefits of Increasing Enterprise Architecture Management Maturity

Measuring the true impact of increasing Enterprise Architecture Management maturity is hard to achieve IT architecture simplification can be one of the largest contributors tor IT cost reduction (in the range of 5%-18%) but it has a long lead time - up to 2 years

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Outcomes of Effective Enterprise Architecture ManagementStandardising Information Elements Shared Between Systems Modeling Information Relationships and Lifecycles Deploying Integration Infrastructure

Standardising Hardware and Core Software Platforms

Specifying Application Architecture Requirements

Building Reusable Application Components

Defining Architecture Methodology

Reduced CostsDecember 4, 2010

&

Service Improvements55

Impact of Effective Enterprise Architecture Management Can Be Difficult to QuantifyPrimary/ Immediate BenefitsLower integration costs (and corresponding project costs) Shorter integration time (and corresponding project time Increased hardware utilisation and deferred or eliminated hardware spend Simplified development Simplified analysis and testing Eliminated or reduced spend on redundant application purchase and development Leverage new capabilities for competitive advantageDecember 4, 2010

Secondary/ MediumTerm BenefitsRationalised application portfolio Integrated infrastructure and application management Renegotiation/consolidation of supplier contracts Better information quality Faster access to information Higher application development productivity Lower capital spend

Tertiary/ Long-Term BenefitsImproved responsiveness to business needs Better IT and business decisions

Higher IT productivity

Reduced operational risk Improved operational efficiency and effectiveness Sustained cost reductions Increase flexibility within the business and IT56

Impact of Effective Enterprise Architecture Management Can Be Difficult to QuantifyPrimary/ Immediate Benefits Secondary/ Medium-Term Benefits Tertiary/ Long-Term Benefits

Scope and Benefits of Enterprise Architecture Over Time

Directly Quantifiable

Difficult to Define

Intangible

Ease of Measuring Benefits of Enterprise Architecture

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Measuring Quantitive and Qualitative Value from Enterprise ArchitectureMeasures of Value from Enterprise Architecture Quantitive Measures of Value Reduced Project Risk and Complexity Improved Project Success Cost Control and Improved Return on Investment Reduced Costs for Business As Usual Operations Enable Delivery of IT StrategyDecember 4, 2010

Qualitative Measures of Value Improved Business Requirements Delivery Better Alignment with Business Increased Agility and Competitiveness Improved Business Knowledge

Reduction in project time and cost over-runs both without scope or quality reduction

Reductions in faults and overspend due to incorrect requirements

Solution quality, delivery on-time and within budget and to user satisfaction

Quality-related feedback from the business through regular surveys

Measuring return on projects over lifetime

Measure through feedback where IT is viewed as an partner and enabler with the business and not just a cost and constraint Measure through effect with the business becoming better connected and greater reach of processes

Complete operational costs of IT to reflect the total cost of ownership

Sustained delivery of the IT Strategy which should also be concerned with delivering value58

Focussing on Areas of Low Maturity and High ImportanceFourth Areas To Focus On To Generate Improvements Second Areas To Focus On To Generate Improvements

High Maturity

MaturityThird Areas To Focus On To Generate Improvements First Areas To Focus On To Generate Improvements

Low Maturity

Low View of Importance

High View of Importance

ImportanceDecember 4, 2010 59

Focussing on Areas of Low Maturity and High Importance

Use Enterprise Architecture measurement framework to identify areas of greatest return on investment

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Enterprise Architecture Value Measurement ProgrammeDefine Enterprise Architecture Measurement Framework Plan Enterprise Architecture Implementation /Enhancement Programme of Work

Feedback on Measurement Framework

Measure Enterprise Architecture Value

Analyse Enterprise Architecture Value Measures

Execute Programme

Measure Delivery and Results

Does the Enterprise Architecture programme have a measurable impact on the IT investment portfolio? Does the Enterprise Architecture programme lead to measurable improvements of performance? Is there a clear relationship between Enterprise Architecture programme and business services? Does the Enterprise Architecture programme result in measurable cost savings/avoidance?December 4, 2010 61

Summary

Appropriate Enterprise Architecture can deliver significant business benefits Comprehensive Enterprise Architecture value measurement framework is needed to link Enterprise Architecture to business benefits

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More InformationAlan McSweeney alan@alanmcsweeney.com

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