Presentation on theme: "Proposal for an Enterprise Business Architecture"— Presentation transcript:
1Proposal for an Enterprise Business Architecture Denise BedfordInformation QualityRevised February 19, 2007
2Purpose & Overview Purpose of the presentation is to: propose a framework and strategy for aligning IT to business through the development of a business architectureHear the Architecture Committee’s advice on the value and feasibility of moving in the direction of a business architecturePresentation OverviewValue of Business ArchitectureDesigning a Business ArchitectureBusiness Process Management
4Business Challenges Business is facing: Global business competition Rapid innovation and fast-changing business requirementsRegulatory compliance challengesIncreasing cost pressuresTechnology’s typical responseSlow delivery timesHigh maintenance costsBrittle solutionsStove piped functional applicationsRedundant development efforts and operationsRedundant and costly investment in multiple technical solutionsCan technology be realigned to support the needs of business?
5Aligning IT with Business There is little disagreement within or outside the organization that we need to align information technology to support the businessWe need to decide:What we expect to achieve from the alignment and how will we measure itWhat alignment means from a business and from an IT perspectiveWhat strategy we will use to achieve the realignmentThe decisions will be made at the enterprise level so there needs to be an enterprise context for the realignmentThe realignment needs to support decentralized development and business evolution in the future – to achieve this we need a business architecture
6Expected Results of Aligning IT with Business How do we know this is not just the latest management fad?Because it has practical applications which we can use to achieve our business goals and objectivesWhat are we trying to accomplish by shifting the role of information technology to an ‘enabler’ rather than a ‘driver’?Define direct and derivative results of shifting our focus to a business viewWhat is required to implement a business architecture?Alignment takes the form of a fully elaborated Business ArchitectureWhat does it mean for how we work?A four step plan is proposed for moving towards a business architecture involving business stewards, business analysts, technical stewards and data management team
7Value of Business Architecture Focusing on supporting the business, and casting technology in an enabler mode, will generate direct and derivative results.Records Capture &Management ImprovementChange ManagementData Quality Control &Assurance ImprovementsSystems InteroperabilityTechnicalInformationalApplication ReuseBusiness Semantics & SharingBusinessOptimizationProcess OptimizationFinancial Management & ControlBusiness Impact AnalysisWorkflow Design & SupportRole ManagementBusiness Intelligence & BenchmarkingDirect ResultsDerivative Results
8Business & IT Alignment - Direct Results Direct Business Results include…End-to-end business process analysis and adjustment (process optimization, improvement and simplification)Alignment of resource management and analysis by business areas and with business goals (financial management and controls)Pre-impact and pre-incident detection of business events and business targets, and the ability to assess the impacts and lead times in order to mitigate the business impact (business impact analysis and business continuity)
9Business & IT Alignment - Derivative Results Derivative Business Results include..Cross-organizational role discovery, provisioning and management based on common groups of privileges and permissions (increased effectiveness in role management and identity provisioning)More effective and targeted benchmarking with peers and enable more efficient measurement, reporting and evaluation (business metrics and intelligence)More efficient business processes based on automated workflows and business process management (workflow design and management)
10Business & IT Alignment - Derivative Results Technical Derivative Results include…Smarter and rapid deployment/redeployment of new platforms and services, providing sufficient information to plan and manage the change cost effectively (change management)Interchangeable functional component design through increased access to and reuse of technical resources (applications reuse)Optimization of use of the organization’s technical resources by all contributors or consumers, regardless of location (systems interoperability)
11Business & IT Alignment - Derivative Results Data and Information Derivative Effects include…More rigorous, visible and auditable records capture throughout business processes (records management)Identification and management of quality control checkpoints and improvements in data quality and trustworthiness (information quality assurance)Access to management information from a business perspective rather than an application perspective (business semantics)
13Designing a Business Architecture In order to align technology with business, we need to design a business architectureBusiness architecture includes:Business framework to which all business definitions and models can be mappedBusiness process management best practices for representing business processes which are manageable by business analysts, understandable to business managers and executable by developers
14Current State – Business Framework We don’t have a comprehensive view of the Bank’s business at this time, although we have a wealth of business knowledge and documentationCurrent business definitions may be constrained to what single organizational units do and how they do itMay be variations on a process across the organizationFormal policies and procedures may not fully describe how work is doneMay be gaps in coverage of some business processesMay be redundant descriptions of the same process which are not consistently maintainedMay represent a technology view rather than a human workflow viewMay not describe all of the resources that are required to support a business process
15Current State – Business Framework For example, there are currently several high level schemes in use throughout the Bank –Accounting framework (Controllers’ – budget and expenditures)Records management framework (BRCS, Archives Fonds – organizational history)IT-Business framework (application-focused)Business continuity framework (core processes and critical incident)Business definitions in administrative, policy and procedures manuals (business operations)Each scheme represents a resource viewpoint, though none serves as a baseline for comprehensively aligning resources to end-to-end busienss processesWe propose a new framework which will allow us to harmonize these views – this framework takes the form of an organizational business taxonomy
16Business Framework Business Areas Lines of Business Business Processes Strategic Alignment and AggregationFinancial Administrative & CorporateOperationsBusiness AreasAnalytic and Advisory ActivitiesLendingLines of BusinessProject IdentificationProject PreparationProject AppraisalProject NegotiationProject ApprovalBusiness ProcessesPrepare AIS in SAPPrepare PCN, PID, ISDSPrepare SMOPCN Review MeetingROC and/or OC reviewBusiness architecture describes what an organization does and how it does itThis is the most challenging aspect of defining a business architecture – but it is the most important . Success or failure of a business architecture depends on how well an organization can describe what it does – vertically and horizontally.Enables the organization to represent what it does at the coarsest and the finest level of granuality. Coarsest level – strategic performance and management level, institutional goals. Finest level – the step by step process that a person follows to execute the organization’s work. Representation crosses organizational units and describes processes from initiation to completionDefining a top to bottom framework which allows us to integrate, aggregate and disaggregate business information – vertical architecture. Vertical alignment of human, financial, data/information, technical infrastructure and applications. We propose a a reference model from which to work:Business Area – Strategic Goals & Performance MetricsLines of Business – Value ChainsBusiness Process and Subprocesses – End to end process definitionsIdentifying business processes from beginning to end across the organization – regardless of the application or organizational unit – horizontal architectureBusiness Subprocess and TasksEnd to End Primary Business Activities
17Bank’s Business Framework Level 1: Business AreasHigh level aggregation which distinguishes primary and support activities, and which is aligned with organization’s strategy and performance goals [Example: Operations]Level 2: Lines of BusinessSet of one or more linked business processes which collectively define a line of products and services [Example: Lending]Provides a level of aggregation which is valuable for evaluation and monitoring but not sufficiently granular to enable business process managementLevel 3: Business ProcessEnd-to-end description of a process which is comprised of a series of steps or tasks that have defined conditions triggering its initiation and defined outcomes/outputs at its completion [Example: Project Appraisal]Level 4: Business Subprocesses and TasksIndividual tasks which make up a process, or a group of tasks which is enacted or called from another (initiating) process (or subprocess), and which forms part of the overall process [Example: Draft Aide Memoire]Business Areas…represent the organization’s highest level strategy and performance goalsare defined by the organization’s senior managementare published in the World Bank’s Strategy and Performance ContractsThe enterprise’s corporate management provides us with the areasOperational Business AreaFinancial, Administrative and Corporate Business AreaLines of Business …Resemble value chainsAre defined according to a set of objective criteriaCriteria help us to look across organizational structures to see lines of products and servicesLines of products and services will logically have similar…job profilestypes of facilities, applications and technology supportclients/stakeholdersPolicies and proceduresService standards and metricsBenchmarking targets – within the same economic sectors or industriesProcesses and subprocesseLet’s review the criteria we’ve established to identify a Line of Business. Then let’s review the proposed Lines of Business for the two Business Areas
18How to Determine if it is a ….. CriteriaLine of BusinessBusiness ProcessDefinitionThere must be an accepted and published definition of the line of business, including all products and servicesThere must be defined conditions marking the initiation and completion, and a sequence of steps in between.Policies & Governance ProcessesThere must be defined, institutionally authorized and published policies at the LoB level.There are institutionally authorized and defined business procedures, events, rules, tiggers and conditions that derive from and implement the LoB policies.Products & Servicesvs. Inputs & OutputsThe LoB must have defined products, services, outputs and outcomes which are required to sustain the organization.The Business Process has defined inputs which are converted directly to outputs at the end of the process.Budget vs. ExpendituresThe LoB has a defined budget line.Business process incurs individual expenses which can be tied to tasks or subprocesses, for all types of resources.RisksThere is a known business risk to the organization when it is not available.Inherits at least the risk rating of the LOB, but may have an elevated risk if the business process must continue regardless of other BPs in the LOB.Service Standards & MetricsLoB must have defined and published service standards and quality metrics across products and services.BPs have service standards and quality metrics for individual products and services.Clients & StakeholdersLoB has defined consumer groups/segments and stakeholders, whether internal or external to the organization.BPs tracks to specific customers, who receive the products and services at the completion of the process.
19How to Determine if it is … CriteriaLine of BusinessBusiness ProcessHuman AssetsLoB has associated core competencies, job family and job profiles.Business processes have people/roles and/or agents assigned to specific steps or subprocesses. Can trace human resources used to perform the business process.Facilities, Technology & Information AssetsSupported by facilities, consume energy, use communications, data, and information to generate outputs and outcomes.Tracks to specific applications at specific points in the business flow. Uses and produces known information assets. Tracks to specific offices and technology expenses to support the people and systems used in the process.Comparable Industrial SectorHas comparable economic sector and external competitors, regardless of whether it is a primary or supporting LoB. LoB may or may not be a primary activity for the institution.Does not have a comparable industrial sector because it is not at a sector level of categorization. Inherits this value from the Line of Business.Known Business ProcessesMust have one or more associated business processes. Line of Business can not exist without supporting business processes.Is comprised of steps that make up a business process. Has a defined initiation point and a defined completion point. May have business subprocesses but does not include another business process.Business AreaIs aligned with a Business Area as defined by the organization’s strategic and performance contracts.Not applicable.
20Line of Business vs. Business Process These terms are often used interchangeably in the business literature but it is important to distinguish them becauseLine of business is generally one level above where we can do business process management effectivelyLine of business is comprised of multiple business processes – each of which represents an end-to-end processLet’s consider what would happen if we tried to do business process management at the Line of Business level
21Business ProcessesThe framework provides us with a structure for harmonizing the Bank’s business knowledge, but we need to look at individual business processes for the detailed business knowledge that will help us achieve our goalsThe top two levels of the framework (business areas and lines of business) provide us with a strategic view of the Bank’s businessThe bottom levels of the framework (processes and subprocesses) provide the business knowledge needed to begin to design a business architecture and to support business process managementLet’s focus on Business Processes and Subprocesses in order to identify the kinds of business knowledge we need to support the business
22Lending Line of Business Comprised of Linked Business Processes ProjectIdentificationProjectPreparationProjectAppraisalProjectNegotiationProjectApprovalPrepare AIS in SAPPrepare SMOPrepare PCN, PID, ISDSPCN Review MeetingROC and/or OC review(for projects high risks)Draft PADPIDPAD-stage ISDSDraft EA, RAP, IPDPMinutes of PCN meetingMinutes of QERDecision mtg packageMinutes, PID, ISDSSMONotice to BorrowerDraft Aide-memoirePost-appraisal letter toBorrower.Steps & SubprocessesLending Line of BusinessLending Line of BusinessResources Allocated andManaged at these levelsApplication calls areExecuted at this levelProcess Variations are found andImprovements are made at these LevelsProjectSigningProjectEffectivenessProjectSupervisionProjectCompletionProjectEvaluationLine of Business level is too coarse to support process management goals and objectives
24Business Process Management Best Practices Business process management recommends that we:Define internal best practices and guidelines to ensure that business process models are consistently developed (ARIS Framework)Develop business models for processes, and inventory, register and publish existing business models (Business Analysts & Stewards working with IQ and IS teams)Recommend standards-based modeling and execution languages to be used by developers for implementing business process models (OASIS – BPEL, WSDL, XSD)Build a business architecture layer as part of enterprise architecture (SOA + BA)Establish an enterprise governance process for business process management
25Business Process Models A business process should be represented as models of end-to-end sequence of tasks or subprocesses, which describe all of the inputs, outputs and steps/activities required to execute the processARIS framework provides us with a comprehensive view of a business process descriptionWorking within the business framework, and leveraging the ARIS business processing modeling strategy, we can both harmonize across the organization and standardize our current business knowledge
26Business Process Description InformationServicesGoalInformationServicesOtherServicesOtherServicesEnvironmentalDataMaterial InputMaterial InputFinancialResourcesFinancialResourcesBusinessProcessSteps & SubprocessesResult/EventInitial EventMessageOrgUnitHumanInput/OutputMachineResourcesComputerHardwareSoftwareRobust description of a business process includes all elements of the ARIS framework.
27Business Framework and Business Process Management Looking back to the value proposition, we need a level of business process description which will allow us to:connect any system associated with the processidentify the people who support itlink financial resourcesacknowledge but also cross organizational boundariesidentify compliance (financial, records) pointsidentify data and information quality control pointsIdentify common steps and subprocesses to simplify and reuse applicationsprovide managers with the capability to monitor the process for improvement and planning purposes
28Business Process Project Identification Project Preparation Project Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).BusinessProcessProjectIdentificationProjectPreparationProjectAppraisalProjectNegotiationProjectApprovalPrepare AIS in SAPPrepare SMOPrepare PCN, PID, ISDSPCN Review MeetingROC and/or OC review(for projects high risks)Draft PADPIDPAD-stage ISDSDraft EA, RAP, IPDPMinutes of PCN meetingMinutes of QERDecision mtg packageMinutes, PID, ISDSSMONotice to BorrowerDraft Aide-memoirePost-appraisal letter toBorrower.Negotiations PackageFormal Invitation toBorrower to NegotiateMinutes of NegotiationSummary of NegotiationStatus of NegotiationnoticeFinal Board PackageSCR & to SECBORegional Pre-board mtgMemo to MDPre-board meetingBoard ApprovalActivitiesTL prep. PCN packageand Sends to SMTL prepares if applicableROC and SM clearsTL prepares OC andSM, CD, RVP clearTT prepares QERpackageSM ClearsTL circulatesTL prepares minutes ofQER and SM clears andIssues minutesTT prepares package,SM and CD clearTL prepares notice toBorrower and CD issuesTT prep. aide-memoire,TL signs & deliversTL prep. post-appraisalletter SM-CL-CD clearTT prepares and CD, SM,LOAG2, CC clearTL prepares minutes andLawyer, LOAG2, Leaderof Borrower deleg. clearTL & Leader of Borrowerdelegation signTL prepares Board pkg,SM-FO-LY-CD clearLawyer prepares SCR &signed by RVP, LEGVP,expert appointed by CGTL prepares NB-BoardApproval & lawyer clearsRole & RespAIS, SMO, BTORPCN, PID, ISDSCover Memo, NoteAgendaMinutes of PCN reviewPAD, PID, ISDSSafeguards DocumentsMinutes of QERAgendaTransmittal MemoPAD,,PID, ISDSSafeguards DocumentsLegal DocumentsMinutes, AgendaSMO, Aide-memoireNotice to BorrowerBTOR, LetterMemo, PAD, MOPNotice of InvitationLetter of InvitationLetter of Sector PolicyLetter of DevelopmentProgramMinutesTransmittal memoform 2337 , form 1767Board Doc Sub. FormPAD, MOP, speechNotice to BorrowerSCR ReportForm 14, Form152SpeechInformationAppSAP, IRIS, Passkey, ProjectPortal, Lotus Notes, TravelWebIRIS, Passkey, ProjectPortal, Lotus Notes, LASSAP, IRIS, Passkey, ProjectPortal, Lotus Notes, LAS,Travel WebIRIS, Passkey, ProjectPortal, LAS, Lotus NotesIRIS, Passkey, ProjectPortal, LAS, Lotus NotesW2K, Domino, Edge Server,HIS, Oracle, WebSphere,Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise LuminateW2K, Domino, Edge Server,HIS, Oracle, WebSphere,Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise LuminateW2K, Domino, Edge Server,HIS, Oracle, WebSphere,Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise LuminateW2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes,Siteminder, iPlanet, Solaris,Sybase, Replication Server,WebServer,Print Archietcture.W2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes,Siteminder, iPlanet, Solaris,Sybase, Replication Server,WebServer,Print Archietcture.TechnologyMetricTime, Cost, Capacity, VolTime, Cost, Cap, Vol, QualityTime, Cost, Cap, Vol, QualityTime, Cost, Cap, Vol, QualityTime, Cost, Quality
29Business Process Project Signing Project Effectiveness Project Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).BusinessProcessProjectSigningProjectEffectivenessProjectSupervisionProjectCompletionProjectEvaluationNotice of signing andsigning ceremonyNotice to Borrower –signingSigned Legal DocumentsNotice to Borrower –Declaration ofEffectivenessProcurement processDisbursementFinancial ManagementCompletion reportidentifying accomplishm-ents, problems, lessonlearned.OED assess what worksand what does not andlearn from theexperience.ActivitiesTL sends an invitationOn signingTL prepares a notice toBorrower – signingand Lawyer clearsTL sends signed LegalDocuments to ACTCFTL prepares a memo &letter and lawyer clearsCD signs and sendsLetter to BorrowerBorrower prepares specsand evaluates bids.Ps ensures procurementDisbursement Officerauthorize to withdraw fundFM maintains oversightof the FM projectBorrower submits acompletion report to theBank Board of EDsOED staff assesses theproject and sends toCD, SM, SD, TL, etc.Role & RespNotice of SigningLegal DocumentsNotice to BorrowerFAXMemoNotice to Borrower-letterBid documents,ContractBid evaluation reportMinutes of bid openingCost estimate sheetTechnical &/or financialevaluation reportFM Reports/DocsReport that containsaccomplishments,problems,lessons learnedOED evaluation report.InformationIRIS, Lotus Notes, PasskeyIRIS, Lotus Notes, PasskeyIRIS, Passkey, Project PortalClient Connection, LAS,Extranet, Lotus NotesIRIS, Project Portal,Lotus Notes, PasskeyIntranet, Lotus Notes,PasskeyAppW2K, Domino.W2K, Domino.W2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes,Siteminder, iPlanet, Solaris,Sybase, Replication Server,WebServer,Print Archietcture.W2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes,Siteminder, iPlanetEdge Server, IHS,WebSphere, Oracle, SAP,Siteminder, iPlanet, LotusNotesTechnologyMetricTimeTimeTime, Cost, Cap, Vol, QualitySatisfactionQuality
30Travel Planning Travel Transacting Travel Controlling Travel Metrics for Travel (Bank Wide: Over $ 200M in FY-05): Cost Effectiveness – Get Best Results with available FundsTravelPlanningTravelTransactingTravelControllingTravelMonitoring –Specific TripTravelMonitoring -Unit/VPUBusinessProcessPlanning at Budget LevelPlanning Specific TripBefore the TripAfter the TripPre-Trip ControlsPost-Trip ControlsMonitoring Specific TripMonitoring SpecificUnit/VPUActivitiesBudget Analysts/Officersforecast travel expensesTraveler makesReservation and entersTrip information into theWeb TravelTraveler contacts A. ExpAM approves the tripA. Exp receives Noticeand issues the ticketTraveler enters expensesTCS is sent to ManagerEx Ante Controls: verifycost assignment,explanation of exceptions,PCard Usage, etc.Ex Post Controls: trip isapproved, traveler sendsreceipt to ACT.Traveler can use theWeb Travel System tomonitor the status of triprequest as well as sub-sequent expense reimb-ursement requestBudget Analysts/Officersuse the SAP Cost Reportor AdministrativeExpense Report tomonitor travel expensesRole & Resp.Travel AuthorizationsTravel Advisory servicesand guidelinesTrip Document createdIn travel web systemReservation – itinerarywith American expressItineraryVISATicketBTORTravel Expense PostingsTrip DocumentPCardReceiptDisplay TripPrint/Simulate TripMy Trip Summary ReportOutstanding Trip ClaimsReportTravel ExpenseException ReportBudget Summary ReporOperational MissionSummary ReportInformationAppOnline Reservation system,Travel Web, Passkey, NotesTravel Web, SAP, Passkey,NotesSAP, Travel Web, PasskeySAP, Travel Web, PasskeySAP, Travel Web, PasskeyW2K, IIS, Oracle,MS Load Balancer, SAP R3,TSM, NetIQ, Telalert,Edge Server, IHS,WebSphere, Lotus NotesW2K, IIS, Oracle, MSLoad Balancer, SAP R3,TSM, NetIQ, Telalert,Edge Server, IHS,WebSphere, Lotus NotesW2K, IIS, Oracle, MSLoad Balancer, SAP R3,TSM, NetIQ, Telalert,Edge Server, IHS,WebSphereW2K, IIS, Oracle, MSLoad Balancer, SAP R3,TSM, NetIQ, Telalert,Edge Server, IHS,WebSphereW2K, IIS, Oracle, MSLoad Balancer, SAP R3,TSM, NetIQ, Telalert,Edge Server, IHS,WebSphereTechnologyMetricCost EffectivenessCost EffectivenessCost EffectivenessCost EffectivenessCost Effectiveness
32Current State – Business Process Models Current status of business process modeling..Business process models exist for some business processes but they are represented at varying levels of detail, quality and focusIn other cases, business processes are described as documentation (business procedures, administrative manuals, operational procedures, etc.)For some processes, there are neither models nor procedural documentationRecommend that as business analysts work with clients, they conduct a systematic inventory of business process models to…Identify what exists and what is needed to harmonize itIdentify gaps in existing processesDetermine what is needed to fill the gaps
33Business Process Model Registry Design an enterprise level repository for business process models consistent with enterprise architecture best practicesEstablish a registration and review process for all business process models which is consistent with the Business Architecture governance modelEmpower business analysts to:Discover and inventory existing business process modelsIdentify redundant modelsIdentify variations in practiceIdentify and link models that describe steps or subprocesses in the same business processIdentify business processes which are not described by BP models
34Standards-Based Modeling and Execution Languages Business architecture is implemented in degrees – it is possible to achieve a level of interoperability without having a fully deployed SOA if consistent business semantics are used across applicationsHowever a fully developed business architecture presumes a cross application, business-oriented service oriented architecture which is grounded in standardsAlthough the standards are not yet widely adopted, some major application vendors are supporting OASIS:BPEL for defining process flowsWSDL for defining the interfaces to services used by the processXSD for defining the XML data structures used by the process
35Establish Business Architecture Governance Model Because the business architecture has such high value to the organization, it needs to be managed at the enterprise levelBecause the business architecture is cross-organizational and cross-applications, roles and responsibilities associated with building and sustaining it need to be clearly defined and supportedWe have proposed a governance and stewardship model which identifies and describes four roles and responsibilities, including:Business stewards at all three levels of the framework (Business Area, Business Lines, Business Processes)Information Quality/Data Management ProgramBusiness AnalystsTechnical Custodians