Sunday, December 12, 2010

First Question in Stress-testing Your Enterprise Architecture: What is the driving purpose behind the business?

We've come to the first of seven questions to ask when stress-testing your Enterprise Architecture: What is the driving purpose behind the business?
The purpose of asking this question is to put the focus where it belongs: Why do we exist? What purpose do we have?
The answer to the driving purpose behind the business is underpinning all the other questions.

So how can the driving purpose behind the business be broken down into smaller pieces? Here's one way of breaking it down:

  • What is the purpose? What value are we contributing to the world and justifies our existence? Some strategists claim that there are really only two main strategies possible to follow; cost focus addressing a mass-market or niche markets with value and segmentation focus. 
    • Clearly articulate which of the two strategies you are following. In which terms is low-cost defined? How will low-cost develop over time? Which niches are you targeting now and will it be on segmentation or additional niches further growth will come from?
    • For example IKEA, the furniture retailer, is following a low-cost mass market strategy. Adhering to a low-cost strategy its IT should be in line with that both from an IT perspective and from which business process support is most crucial. Within furniture retailing the supply-chain and store operations are most critical to maintain the low-cost of overall operations. Providing state-of-art supply-chain systems in line with operations, meeting their requirements of total-cost of shipping and keeping store balances in line with targets are among the most cost cutting actions IT can provide.
  • What is the drive behind the business? What pushes it forward? Is it product development, customer satisfaction, geographic coverage or some other dimension? 
    • Be specific on which drive your are focusing on right now. The drive varies over time and can be different things at different times. 
    • For example Ericsson, the telecommunications company, were first driven by product development during AXE switch development, then by expanding globally through its product leadership, then products again when the mobile industry took up speed and now it is customer satisfaction in its professional services line. Following these shifting demands means that IT should shift focus over time. The critical issue is to know when to invest in supporting a certain area and when to stop further investments. It is as important to stop investments to afford supporting new growing dimensions.

When designing an Enterprise Architecture be sure to answer the question What is the driving purpose behind the business? and how it is supported, enabled and grown through the EA work.

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