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What is the Value of Architecture Andrew L Macaulay Global Head of Architects Community March 2006 In collaboration with Microsoft Architect Insight Conference.

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Presentation on theme: "What is the Value of Architecture Andrew L Macaulay Global Head of Architects Community March 2006 In collaboration with Microsoft Architect Insight Conference."— Presentation transcript:

1 What is the Value of Architecture Andrew L Macaulay Global Head of Architects Community March 2006 In collaboration with Microsoft Architect Insight Conference Drive the Debate

2 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 1 Agenda Introduction Issues Facing Business How Can Architecture Help? What Does Service-Oriented Architecture Add? Critical Success Factors Summary

3 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 2 Introduction What is the true value of architecture? Cost Reduction? Risk Reduction? Improved Business/IT Alignment? Improved Business (and IT) Agility? And how does the culture and behaviour of an organisation affect the outcome? To answer these questions, we need to understand … What we mean by Architecture What we mean by Value And how we might start measuring Value

4 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 3 Architecture means different things to different people Enterprise Architecture Business Architecture Enterprise IT Architecture Enterprise IT Information Systems Architecture Enterprise IT Technology Infrastructure Architecture Information Architecture Enterprise Security Architecture Enterprise Governance Architecture Software Architecture, Network Architecture, Storage Architecture… Solution Architecture

5 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 4 Aligning Business Strategy and Project Delivery Project Delivery Lifecycle Project Initiation & Start-up Business Case Project Mandate Project & Stage Plans Project ExecutionProject Closure Transition to Run Solution Outline Solution Design Build/Test Cycle Deploy Enterprise Architecture Governance Business Strategy IT Strategy Business & IT Project Prioritisation & Planning Influence choice & timing of projects to ensure progress along the roadmap towards the EA vision Enterprise Architecture Transition Roadmap (As-Is to To-Be) Roadmap represents the route to realising strategic business & IT goals and the EA vision Enterprise Business & Information Architecture Enterprise IS & IT Architecture Enterprise architecture represents the desired future state of the business & IT landscape Enterprise architecture establishes and sets the standards by which solutions should be architected, and provides guidance across the project delivery lifecycle Is the EA roadmap still taking us where we want to go? Are the target architecture & defined standards still fit for purpose? Ensures project level architecture work is properly planned & costed Is the architecture being complied with in the way we want? Are projects getting expected value from the architecture?

6 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 5 Value is also measured from an individual viewpoint Increasing Business Advantage Increasing Business/IT Alignment Improving IT/Project Effectiveness Reduced IT Complexity Reducing Cost of IT CEO CIO CFO IT/System Manager Business Manager

7 Issues Facing Business Today www.capgemini.com

8 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 7 Many Business Drivers – Often Conflicting Cost reduction More value from IT More flexible IT Cheaper solutions and faster Reduce project failures Integrated and interoperable information services Better service from SOE/SOA solutions Guarantee of Quality Compliance …

9 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 8 Business Unit CBusiness Unit DBusiness Unit BBusiness Unit A Typical Current State – Project-focused Silos There is rarely an alignment of functional requirements across business units and even less often alignment with service level and other non-functional requirements across the business Infrastructure and Governance Functional Requirements Version 1 Business processe s Functional Requirements Version 2 Business processe s Infrastructure and Governance Business or Organisation Processes optimised for specific BU requirements result in considerable overlap and redundancy 70% of IT projects fail to deliver their expected results because of this silo mentality With increased complexity and integration of function, cost of change and maintenance is increasing Increasing complexity = increasing £££ for each change Infrastructure and Governance Functional Requirements Version 3 Functional Requirements Version 4

10 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 9 IT Landscapes often locked in a vicious circle Continual business improvement and new initiatives are inhibited by IT due to the slow and costly nature of implementing change Things have been made worse by projects attempting to deliver in an isolated fashion to bypass inhibitors – but this has only resulted in further constraints for subsequent projects in the medium term CxOs often cannot understand why relatively straightforward business changes are costly, risky and slow to implement

11 How Can Architecture Help? www.capgemini.com

12 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 11 The Four Quadrants of Enterprise Architecture Value Increase Business Agility Reduce IT Cost Expand IT Reach Increase Project Success You can continuously adapt your business more quickly and with lower risk than your competition by changing your IT You can significantly improve your success with your investment in IT- enabled business projects You can deliver new IT solutions and manage your existing IT services at lower cost than your competition Reduce Cost Increase Value You can collaborate more effectively than your competition with your customers, suppliers and partners through your IT

13 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 12 Where Does the Value Come From? Reducing Costs Improving Project Success More Reactive to Business Change Enabling Competitive Advantage Enterprise Architecture Capability and Governance Value to the Business Enterprise Architecture Solution Architectures Project Portfolio Management Business Strategy and Goals Consistent (or Managed) View of Non- functional Req Holistic View of Business & IT Systems Design with Knowledge of Context and Enterprise Integrating existing systems easier Reducing project risk Enabling consolidation of servers Reducing complexity of IS & IT systems Increased Understanding of the Business Technology and Systems Roadmaps Innovating & leveraging new technologies Availability and reuse of shared services can drive

14 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 13 Understanding the Different Types of Value Based on Maslow's Hierarchy of Needs Improved responsiveness to Business Change Increase flexibility within the Business and IT Innovation/leveraging of new technology Reduced costs of environment Increased project success Reduced project risk Leverage new capabilities for competitive advantage Reduced costs Architecture can enable Business Benefit Compliance What you have to do to be in business Cost What you have to do to run your business Compet- itiveness Spend Small % decrease in costs frees significant % increase in ability to invest

15 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 14 Information Systems Technology Infrastructure Business Information Security Governance WHY? Contextual WHAT? Conceptual HOW? Logical WITH WHAT? Physical Taking a Holistic View of the Architecture Integrated Architecture Framework, version 3.9, Copyright © 2000-2006 Capgemini

16 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 15 Architecture Maturity/Culture Affects Delivery of Value Level Reduced Cost/Risk Biz-IT Alignment Added Value Not Needed 0Not Understood 1Appreciated£ 2Product Standardisation££ 3Strategy Development£££ 4Architecting Projects££££ 5Enterprise Architecture Development££££££ 6Enterprise Architecture Service££££

17 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 16 Where Does Service-Oriented Architecture fit? Moving to a Services view of the world … Fosters reuse Enables flexible Orchestration rather than fixed process Allows you to leverage virtualisation and consolidation Traditional organisation Tightly coupled processes/systems Stovepipes - Integration spaghetti Services organisation Loose coupling of processes/systems Service Webs - Standard Interfaces TO

18 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 17 SOA Delivering Business and IT Value Externally created Value through more efficient market interaction Mobility Event Driven Real Innovation ………… etc Internal Value created through process redesign Internal Cost Reduction by shared resources License cost savings Platform Rationalisation Storage Area Networks Server Virtualisation Grid Computing Security Web Services Business Intelligence Management tools Development Tools Service Orientated Architecture b Mobility Process based Service-Oriented Infrastructure Service-Oriented Applications Service-Oriented Enterprise

19 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 18 Measuring Value (Quantitive and Qualitative) Examples £ Reduced Project Risk and Complexity Reduction in project over-runs both in terms of cost and time without reduction of required scope £ Improved Project Success Measure around quality of solution; the delivery on-time and within budget £ Cost Control and Improved ROI Measuring ROI of projects over time – there is, however, an investment cost to start this (building reusable services) £ Reduced Costs for Business As Usual Operational costs of the IT estate to reflect the total cost of ownership and does not just shift (hide) costs elsewhere £ Facilitate Delivery of IT Strategy Progress in the delivery and sustaining of the IT Strategy, which itself will be delivering Value through IT Improved Business Requirements This should become visible through better development metrics around faults due to incorrect requirements Better Alignment with Business Quality-related feedback from the business, for example through annual surveys Increased Agility & Competitiveness IT seen as an enabler and partner with the business and not just a cost and constraint on the business Improved Business Knowledge Measure through effect, with the business becoming better connected, business units able to see themselves in context

20 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 19 Case Study: National Assembly of Wales £500k avoided cost in one year joining up projects and delivering common requirements as corporate services rather than siloed functionality Currently predicting over £2m of avoided integration cost across 3 projects by taking an enterprise view early in the project lifecycle The are indications (although not fully quantified yet) from projects that have worked independently to meet siloed needs, that the cost of ignoring the Architecture are orders of magnitude higher than aligning to the Architecture

21 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 20 Capgemini Research: Added Value of Architecture Used Six Sigma methodology for analysis Work to date summarises the first results of the research of benefits of architecture and other factors on project results. A sample is shown on this page The results are based on a survey of 30 projects. Currently developing revised figures based on between 100 and 300 A 95% confidence level is used to test the significance of our hypothesis Role of Project Architecture Role of IAF

22 Summary www.capgemini.com

23 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 22 Critical Success Factors for Enterprise Architecture Connect Developing an EA Capability is a major change programme that will not happen in a few months (acknowledge/plan for this) Strong executive sponsorship from within IT and Business Work collaboratively with both business and IT as partners Regular targeted communication with both the Business and IT, effectively driving a Marketing Plan Understand key stakeholders and communicate specifically with them Make your success and value visible Developing an EA Capability is a major change programme that will not happen in a few months (acknowledge/plan for this) Strong executive sponsorship from within IT and Business Work collaboratively with both business and IT as partners Regular targeted communication with both the Business and IT, effectively driving a Marketing Plan Understand key stakeholders and communicate specifically with them Make your success and value visible Deliver A common language/framework and approach, with supporting tools if appropriate A clear governance model over projects/Solution Architectures, including sufficient Authority A pragmatic approach so that you can delivery some results early and you are not seen as just an ivory tower doing strategy stuff Architecture is a living thing. Use feedback from projects to learn and track the changing priorities and goals in the business A common language/framework and approach, with supporting tools if appropriate A clear governance model over projects/Solution Architectures, including sufficient Authority A pragmatic approach so that you can delivery some results early and you are not seen as just an ivory tower doing strategy stuff Architecture is a living thing. Use feedback from projects to learn and track the changing priorities and goals in the business

24 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 23 Critical Success Factors for Solutions Architecture Governance Work collaboratively with both business and IT as partners Leverage and conform to the Enterprise Architecture Work under the right level of EA governance and provide the right level of solution governance to the design/engineering teams Reuse services and infrastructure wherever possible and appropriate Work collaboratively with both business and IT as partners Leverage and conform to the Enterprise Architecture Work under the right level of EA governance and provide the right level of solution governance to the design/engineering teams Reuse services and infrastructure wherever possible and appropriate Approach A common language/framework and approach with supporting tools, if appropriate Solution Architects with the correct mix of Business and IT skills, and subject-matter-specialists available, maybe through a T-model A pragmatic approach, knowing where to focus and when to stop (when it is good enough) A common language/framework and approach with supporting tools, if appropriate Solution Architects with the correct mix of Business and IT skills, and subject-matter-specialists available, maybe through a T-model A pragmatic approach, knowing where to focus and when to stop (when it is good enough)

25 In collaboration with | Microsoft Architect Insight Conference March 2006 Copyright © 2006 Capgemini - All rights reserved 24 Summary Enterprise Architecture is a journey The business change to implement the capability, the evolution of the Architecture itself, the cycle of awareness to acceptance to adoption of the approach, the change it can foster in the business … Governance, Authority and Sponsorship are critical Getting a governance model that reflects the corporate culture but can deliver the goods, together with the authority and support are critical for EA to be able to function – and then deliver value Communication is key As with Architecture as a whole, communication of the EA function, the Architecture and the value is something that needs to become business as usual Value is in the eye of the beholder Value can come in many forms - never forget that you must understand the business context, culture and stakeholders to be able to really demonstrate value

26 Andrew L Macaulay andrew.macaulay@capgemini.com www.capgemini.com


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