Enterprise Architecture Advisory Service

Executive Update Vol. 14, No. 7

Business Architecture: professionals representing a cross-section of business

units, and this requires senior business sponsorship.
Unfortunately, the business architecture message is just
Part I — Why It Matters beginning to reach business leaders who are account-
to Business Executives able for the success of these types of initiatives. To build
executive support for business architecture, the benefits
must be communicated in business terms. Common
by William Ulrich, Senior Consultant, benefits include:
Cutter Consortium Delivers transparency and clarity to enable stake-
holder collaboration, issue analysis, and problem
resolution

Business architecture is gaining recognition as a game- Provides transparency across business units,
changing discipline that enables businesses to address product lines, and outsourced teams to enable
major challenges in new and unique ways. Simply put, cross-functional planning and ensure that funded
business architecture allows a business to establish a initiatives are not working at cross-purposes
common vocabulary, shared vision, and a degree of Aligns business processes across business units and
transparency that facilitates initiatives ranging from product lines, delivering stakeholder-focused benefits
M&As to the reversal of customer attrition. But even far beyond traditional “lean” or similar process-
as business architecture success stories emerge, the streamlining exercises
message has been slow to penetrate the executive suite.
This Executive Update, the first in a series, discusses why Offers management teams a holistic view of the
business leaders should embrace business architecture business that extends to outsourced, customer, and
as a means of addressing complex business challenges other stakeholder domains
in ways that senior leadership can no longer ignore. Establishes a framework of concepts that allows the
Consider some real-world cases: A pharmaceutical business to clearly communicate current-state busi-
firm uses business architecture to expedite a large- ness challenges and articulate a business-centric
scale merger. An international airline follows suit. A vision for the future
finance and insurance company uses business architec- Allows the business to take ownership and drive
ture to investigate and reverse customer loss. A govern- transformation strategies through business-centric
ment agency uses business architecture to establish a roadmaps and funding models
vision to enable customer self-service. An international
finance company uses business architecture to align the Offers IT a way to recast project-funding discussions
enterprise to a new business model. And finally, a large in terms of business capabilities and stakeholder
financial institution leverages business architecture to value, streamlining often difficult IT budget
streamline its complex, postmerger portfolio. discussions

THE BENEFITS OF BUSINESS ARCHITECTURE A COMMON VOCABULARY

In each of these scenarios, business architecture is Business architecture’s main benefit is that it delivers a
sponsored by business leaders. This is essential because common vocabulary for communicating and reconciling
business architecture is owned by — and most benefits critical business issues across a wide variety of stake-
— the business. The most effective and impactful holders. Miscommunication is rampant across business.
business architecture teams are comprised of business Terms as seemingly straightforward as “customer,”

CUTTER CONSORTIUM
2 ENTERPRISE ARCHITECTURE ADVISORY SERVICE

“representative,” “product,” “margin,” “vendor,” Business architecture addresses these issues by

“broker,” and “partner” are generally assumed but establishing a common language that planning
often misconstrued. Miscommunication is particularly and deployment teams can use to establish a routine
common when discussions cross product lines and understanding of issues as the basis for crafting robust,
business units, which can lead to major problems, long-term solutions with demonstrable business bene-
including a misstatement of expenses or angry cus- fits. Figure 1 provides an overview of the four main
tomers. Poor communication stymies a wide variety aspects that create the foundation for your business
of initiatives, such as improving basic business capa- architecture: business capability, information assets,
bilities, creating common customer views, aligning organizational view, and value streams. While business
processes across business units, and delivering accurate architecture includes other categories, these four com-
financial and regulatory reporting. Consequently, busi- prise the baseline that business uses for issue analysis,
nesses have created modern-day versions of the Tower planning, strategy planning, budgeting, and solution
of Babel, which was never finished because the speech deployment. Each category represents a unique view
of the builders was confounded. of the business but all are connected through a common
vocabulary. The following summarizes this founda-
Consider two cases highlighting how lack of a common
tional view:
vocabulary can stymie progress, while a common busi-
ness vocabulary can overcome these roadblocks. In the 1. Business capability. Capabilities provide a com-
first case, teams responsible for creating coherent views plete view of “what” a business does. Customer
of business information struggled for years to create a Management, for example, is a capability. Capabilities
common view of enterprise data. The teams lacked an are organized into the business capability map, a hierar-
agreed-upon set of business definitions, and numerous chical topology of what the business does. This map
initiatives stalled. The business wasn’t engaged and serves as a foundational view of the business that
couldn’t see why this mattered. In the second case, a eliminates the inherent complexity involved in dis-
business architecture team created a capability map cussing “how” something is being done or “who” is
that identified what the business does in complete, doing it. Capabilities provide the basis for crafting
concise ways. Capability definitions provided to the business-driven transformation strategies, which often
data architecture team allowed the team to craft a include improved or new, automated solutions.
common data model that fully aligned to the business
2. Information assets. Business information assets
vocabulary. While teams in our first case continued to
clearly define the information required to ensure that
struggle with creating priority management initiatives,
each capability is robust, viable, and acceptable to the
teams in our second case created a common information
business from a strategic perspective. For example,
model that expedited projects across business units, cus-
the definition of the “Account Management” capabil-
tomer initiatives, product lines, and complex processes
ity must correspond to the definition of the informa-
and technologies.
tion asset “Account.” Information assets, along with
The lesson learned here is that the lack of a common capabilities, form the foundation for the business
vocabulary has far-reaching effects and is the basis for vocabulary and data architecture.
many failed projects. Misperception and miscommuni-
3. Organizational view. Organizational view creates
cation stem from and further compound widespread
a structural overview of the business. This includes
redundancy and inconsistency, which in turn can lead
traditional business units and subunits but can be
to customer losses, missed opportunities, lost revenues,
extended to include collaborative teams, outsourcers,
and millions of dollars in failed initiatives. The same
and other external stakeholders. Organizational views
issues are rehashed meeting after meeting due to a lack
can be enhanced by mapping business units to strate-
of transparency across business units and product lines.
gies, capabilities, and initiatives.
This process repeats itself year after year, stalling major
initiatives, leaving business opportunities on the table, 4. Value streams. Value streams depict the activities
and running up spending on failed projects. involved in how a business delivers end-to-end

The Executive Update is a publication of the Enterprise Architecture Advisory Service. ©2011 by Cutter Consortium. All rights reserved.
Unauthorized reproduction in any form, including photocopying, downloading electronic copies, posting on the Internet, image scanning,
and faxing is against the law. Reprints make an excellent training tool. For information about reprints and/or back issues of Cutter Consortium
publications, call +1 781 648 8700 or email service@cutter.com. Print ISSN: 1554-7108 (Executive Report, Executive Summary, and Executive Update);
online/electronic ISSN: 1554-7116.

Vol. 14, No. 7 ©2011 Cutter Consortium

EXECUTIVE UPDATE 3

iew

Va
lV

lu
na

eS
tio

tre
za

am
ni
ga

s
Or Business
Capability

Information Assets

©TSG, Inc.

Figure 1 — Business architecture foundational view.

stakeholder value. While the capability map is said horizontal views of how to deliver stakeholder value.
to show the business “at rest,” value streams show Positioning investments in terms of business capabilities
the business “in motion.” Common value stream and value streams allows the business to focus on busi-
examples include Manage Customer Portfolio, ness value and not on IT centricities.
Update Account, and Build Product. Value streams
Using business-focused roadmaps and related budget-
are always triggered by a stakeholder, shown as end-
ary models does not imply a “big bang” or “boil the
to-end views, and represent an aggregated view of
ocean” approach. Having visibility across more than
cross-functional business processes. Value streams
a single business unit does not mean that all issues or
are the main aspect of business architecture used to
technologies will or should be addressed in a single
align and consolidate business processes and deliver
project. Delivering a business-driven vision, strategy,
automated solutions with a high degree of stake-
roadmap, and related funding model through the use
holder visibility.
of the capabilities and value streams provided by the
business vocabulary means that all aspects of a given
BUSINESS ARCHITECTURE PLANNING, ROADMAP capability and/or value stream are considered when
CREATION, AND BUDGETING making major initiative investments. However, this is
rarely the case today because such visibility is sorely
Business architecture provides a basis for transform- lacking.
ing how business communicates and collaborates to
achieve its goals across business units and product lines. For example, consider a bank that implemented a
One of the most fundamental benefits, however, is that replacement system for a small portion of its risk-rating
business architecture enables a more business-focused environment with no understanding of how it would
investment strategy in major initiatives. Most noninfra- replace the two systems already enabling this capabil-
structure-focused IT spending is typically aligned to a ity. Millions of dollars were spent, leaving the bank
given set of software applications. This approach limits with three redundant, yet fragmented, applications
the business vision to a siloed, technology-centric point enabling this capability. Little business value was
of view and leaves critical capabilities not part of achieved, and now the bank has three systems imple-
an IT solution today off the table, virtually ignoring menting the same capability in different ways, using

www.cutter.com Vol. 14, No. 7

4 ENTERPRISE ARCHITECTURE ADVISORY SERVICE

three different views of business information. Con- In Part II, we will continue our discussion of the busi-
sequently, the business has destabilized a portion ness architecture and examine business-driven trans-
of its business model. This could have been avoided formation strategies, roadmaps, and budget models.
had the business provided a capability-focused man-
date to streamline and consolidate risk rating, along
with a common strategy, vocabulary, and vision for ABOUT THE AUTHOR
the risk-rating capability and related information assets.
William M. Ulrich is a Senior Consultant with Cutter’s
Thus, business architecture represents a philosophical Business-IT Strategies, Enterprise Architecture, and
shift in how we discuss business challenges, communi- Government & Public Sector practices and President of TSG,
cate across business lines, establish deployment plans, Inc., a management consulting firm that specializes in business
and allocate funding to improve business capabilities and IT planning and transformation strategies. Mr. Ulrich has
more than 30 years’ experience in the business-IT management
and stakeholder value. This shift will take time for
consulting field. He serves as strategic advisor and mentor on
many organizations and involves the transition from
business-IT alignment initiatives and continues to work as a
silo-based infrastructures, where every business unit workshop leader and author. He has the unique ability to cross
has its own language, to a business ecosystem, where business and IT boundaries to facilitate and streamline busi-
interdependencies — particularly where it impacts ness-IT transformation strategies. Mr. Ulrich’s workshops on
stakeholder value, risk management, and bottom-line business-IT architecture alignment have been widely attended
results — are addressed in cohesive ways through by organizations worldwide. His ability to communicate flu-
streamlined approaches. ently with business executives and professionals and IT execu-
tives and professionals has enabled him to help organizations
With business architecture, ineffectiveness and ineffi- craft transformation strategies that deliver incremental and
ciencies that drive up costs and contribute to failed ongoing business value while managing risk and costs at each
projects will fade as a common business vocabulary stage of deployment.
takes hold. There is no need to wait for results. Many Mr. Ulrich currently serves as Cochair of the OMG Business
of the organizations introduced at the beginning of Architecture Special Interest Group, Editorial Director of
this Update began benefitting from business architecture the Business Architecture Institute, Director-at-Large of
in a very short period of time. As the business architec- the Business Architecture Society, and is a member of the
ture matures, the use of it will mature as well. It only EA Advisory Board for Penn State. His latest books include
took a short time after rolling out the first capability Business Architecture: The Art and Practice of Business
map from one business team to begin using it to align Transformation and Information Systems Transformation:
strategies, transformation planning, roadmaps, and Architecture-Driven Modernization Case Studies. The approaches
outlined in these two publications provide a balance to the
budgetary funding. Senior business leadership and
challenges inherent in delivering business-driven, business-IT
sponsorship is essential to this effort. transformation. He can be reached at wulrich@cutter.com.

Vol. 14, No. 7 ©2011 Cutter Consortium

IT Executive
Education +
ARQUITECTURA DE
NEGOCIO
TALLER DE INMERSION.

Con William Ulrich

25 y 26 de Mayo, 2016
Ciudad de México

Executive Education on IT leadership and emerging trends.

Continuous professional development and personal enrichment
through the year.
IT Executive Education +
Arquitectura de Negocio
Taller de Inmersión.
Con William Ulrich

ACERCA DEL TALLER

QUIEN DEBE PARTICIPAR EN ESTE TALLER
Durante este taller de Inmersión en Arquitectura de
Negocio, beneficia a gerentes y practicantes desde los - Arquitectos de Negocio
novatos hasta a los expertos. El taller de inmersión - Directivos de Areas de Negocio
desmitificará la arquitectura de negocio, proporcionando - Arquitectos Empresariales
una introducción a diversos temas. El taller se enfoca en - Analistas de Negocio
los conceptos fundamentales, el framework de - Administradores de Portafolio y de Programas
arquitectura de negocio, la propuesta de valor, - Responsables de la Estrategia de Negocio
gobernanza, creación del blueprint, alineación
interdisciplinaria y preparación de la práctica.
Adicionalmente los participantes, habrán dado un PRINCIPALES CLIENTES
primer gran paso en su preparación para el examen para Algunos Clientes a los que William Ulrich ha brindado su
Certified Business Architect (CBA)®. Después de su ayuda son: Allstate, Assurant Health, Blue Cross Life, CP
participación en este taller, los asistentes estarán en Rail, Export Development Canada, DIRECTV, FDIC, Ford,
posición de asumir un amplio rango de retos y Franklin Templeton, General Motors, US General Services
responsabilidades en el ámbito de la Arquitectura de
Administration, Northwestern Mutual Insurance, Silicon
Negocios. Valley Bank, Southern California Edison, State Farm, Sun
Life, US Patent & Trademark Office, US Internal Revenue
OBJETIVOS DEL TALLER Service y Wells Fargo, entre otras.
- Proporcionar a los participantes un claro
entendimiento de lo que es Arquitectura de Negocio y ACERCA DE WILLIAM ULRICH
lo que no lo es.
- Amplia introducción a la Arquitectura de Negocio, William Ulrich es Consultor Senior de Cutter Consortium
para practicantes y usuarios. y Presidente de TSG, Inc. Es reconocido como una
- Definir los beneficios y usos de la Arquitectura de autoridad en el ámbito de la Arquitectura de Negocio,
Negocio. Estrategia de Negocio y Transformación de TI. William
- Ofrecer un framework fundamental para la es Presidente y Co Fundador del Business Architecture
construcción de la Arquitectura de Negocio. Guild, organización dedicada a la estandarización y
- Definir los lineamientos y formas para iniciar con la promoción a nivel mundial, de la Arquitectura de
práctica de la Arquitectura de Negocio. Negocio. William Ulrich ha sido un motor de cambio
detrás de la evolución de A Guide to the Business
TEMAS Architecture Body of Knowledge® (BIZBOK® Guide) y el
1. Arquitectura de Negocio: Conceptos Fundamentales. programa de certificación global Certified Business
2. Propuesta de Valor de la Arquitectura de Negocio. Architect (CBA)®. Ulrich es un consultor, mentor y líder
3. Rompiendo el Ecosistema de Negocio. de talleres muy solicitado. Entre los clientes que Ulrich
4. Estableciendo las bases: Capacidad, Valor, ha atendido se destacan diversas organizaciones de
Información y Mapeo de la Organización. gran tamaño y de industrias diversas como servicios
5. Ampliando las bases: Estrategia a través de Mapeo financieros, seguros, manufactureras, eléctrico y sector
de Iniciativas. gubernamental. Es autor de Legacy Systems:
6. Alineación inter-disciplinaria a disciplinas
relacionadas con el negocio. Transformation Strategies (Prentice Hall) y co-autor de
7. Arquitectura de Negocio y Alineación de Arquitectura Business Architecture: The Art and Practice of Business
de TI. Transformation (MK Press) y Information Systems
8. Situación de la Arquitectura de Negocio y Análisis de Transformation: Architecture-Driven Modernization Case
Escenarios. Studies (Morgan Kaufmann Elsevier). También se
9. Definición del Rol de Arquitectura de Negocio, desempeña como Co-Presidente del Grupo de Trabajo
Gobernanza y Patrocinio. de Modernización a través de Arquitectura del OMG.
10. Infraestructura y Herramientas de la Arquitectura de Antes de la fundación de TSG en 1990, William Ulrich
Negocio.
11. Iniciando: Incrementando sus habilidades y su se desempeñó como Director de Estrategias de Re-
práctica. Ingenieria en KPMG. También colaboró con la
IT Executive Education +
Arquitectura de Negocio
Taller de Inmersión.
Con William Ulrich

Northeastern Illinois University y ha facilitdo numerosos CONFERENCISTA Y FECHA DEL EVENTO

talleres, incluyendo sesiones para el Software
Engineering Institute de Carnegie Mellon. Actualmente A pesar de nuestro compromiso pudiera presentarse
continua su trabajo impartiendo talleres y una eventualidad ya sea por la disponibilidad del
entrenamiento en temas de Transformación de TI y del Expositor o por las condiciones climatológicas. Siendo
Negocio. el caso la fecha y el conferencista pudieran estar
sujetas a cambios sin previo aviso.
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POLITICAS
Sustituciones y cancelaciones
• La inscripción a este taller es transferible en todo
momento.
• Cancelaciones un mes antes del evento tendrán un
costo administrativo de $1,000.00 pesos. A partir de
esta fecha no son reembolsables, pero pueden ser
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SEDE DE LA SESION
Hotel Fiesta Inn Insurgentes Sur
Calle Mercaderes 20 Col. San José Insurgentes
(Atrás del Teatro de los Insurgentes)
México, D.F.
Horario de la Sesión: 9:00 a 18:00 horas.
IT Executive Education +
CALENDARIO 2016
Entrenamiento Ejecutivo
Mayo 25 y 26, 2016 - Taller - Ciudad de México
Business Architecture Immersion.
Con William M. Ulrich

Junio 29 y 30, 2016 - Taller - Ciudad de México

Successful Strategies for Outsourcing in the Cloud.
Con Sara Cullen

Julio 27 y 28, 2016 - Taller - Ciudad de México

The CIO Agile Management Toolkit.
Con Jorge Ronchese

Septiembre 7 al 9, 2016 - Ciudad de México

Cutter Agile Conference 2016.

Octubre 21, 2016 - Taller - Ciudad de México

Extracting Business Value from Digital Data Streams.
Con Gabriele Piccoli

Noviembre 14 y 15, 2016 - Cambridge, MA. EUA.

Cutter Summit 2016 - EXECUTIVE EDUCATION+

INFORMES E INSCRIPCIONES: Cutter Consortium América Latina Tel. 55-5336-0418 ext. 111
execeducation@cutter.com.mx
cutter.com.mx/eventos.html