CIS/MIT 8090 Intro

CIS/MIT 8090 Intro

Set the stage

2

Cognitive Map of 8090

IS Architectures as Strategy Weill, Ross & Robertson, “Enterprise

Architecture as Strategy”

Work Systems Models S. Alter, “Work System Method”

IS architectural components and development Mid-Range Modeling

Architectural Modeling options

ERP as instantiation of Architectures

3

Lag

Data

Applications

Infrastructure

Traditional Approach to Systems Implementation

Source: Enterprise Architecture as Strategy: Creating a Foundation for Business Execution, J. Ross, P. Weill, D. Robertson, HBS Press, 2006.

Strategic Initiative

New Idea

Lag Solution Design

4

The Result of Traditional System Implementation Approaches

Corporate Data

Technology Platforms

Applications

Data

5

The systems landscape we'd like to have Data Warehouse

Technology Platforms

Applications

Data

Middleware

6

There Are Four Operating Models


Bus

ines

s P

roce

ss In

tegr

atio

n

Hig

h

Coordination   Unique business units with a need

to know each other’s transactions   Examples: Merrill Lynch GPC,

PepsiAmericas, MetLife

  Key IT capability: access to shared data, through standard technology interfaces

Unification   Single business with global process

standards and global data access   Examples: Southwest Airlines, Dow

Chemical, UPS Package Delivery

  Key IT capability: enterprise systems reinforcing standard processes and providing global data access

Low

Diversification   Independent business units with

different customers and expertise   Examples: Johnson & Johnson, GE, ING

  Key IT capability: provide economies of scale without limiting independence

Replication   Independent but similar business

units   Examples: Marriott, CEMEX, ING

DIRECT

  Key IT capability: provide standard infrastructure and application components for global efficiencies

Low High

Business Process Standardization

7

Different Standardization Requirements of the Four Operating Models


Bus

ines

s P

roce

ss In

tegr

atio

n

Hig

h

Coordination   Customer and product data   Shared services   Infrastructure, portal, and

middleware technology

Unification   Operational and decision making

processes   Customer and product data   Shared services   Infrastructure technology and

application systems

Low

Diversification   Shared services   Infrastructure technology

Replication   Operational processes   Shared services   Infrastructure technology and

application systems

Low High

Business Process Standardization

8

Business Silos

Standardized Technology

Optimized Core

Business Modularity

Business Agility

25% 46% 27% 2% % of Firms

Companies gradually mature enterprise architecture and build out their platforms.

Source: Enterprise Architecture as Strategy: Creating a Foundation for Business Execution, J. Ross, P. Weill, D. Robertson, HBS Press, 2006. Percentage of firms in each stage is updated based on a 2007 survey of 1508 IT executives.

Standardized Enterprise Processes/

Data

Standard Interfaces

and Business Componentization

Enterprise-Wide Technology Standards

Locally Optimal Business Solutions

9

Business Silos


Optimized Core

Business Modularity

Architecture maturity increases global agility.


Global Agility Local

Flexibility

10

IT spending changes as architecture matures.

IT budgets are based on a 2007 survey of 1508 IT executives. Business silos budget is the baseline. Budgets for other stages are represented as a percentage of the baseline budget.

Strategic Choices

Operational Efficiency

IT Efficiency

Local/Functional Optimization

Business Modularity

Optimized Core


Business Silos

0%

100%

Perc

enta

ge o

f IT

Inve

stm

ent

Local Applications

Shared Data

Enterprise Systems

Shared Infrastructure

100% 84% 92% 145% IT Budget

Strategic Implications of IT

Architecture Maturity

36%

35%

25%

40%

16%

35%

15%

33%

18% 21%

32% 34%

11% 14% 17% 18%

11

Architecture Planning and Design

Standards Management

IT Funding Project Management

Firms learn by building management competencies.

Management practices within each practice set are statistically significantly correlated with each other. All four competencies are significantly correlated with architecture benefits.

  Project methodology   Post-implementation assessment   IT program managers   Business leadership of project teams

  Senior executive oversight   Enterprise architecture guiding principles   Enterprise architecture graphic   Process owners   Full-time enterprise architecture team

  Business cases   Centralized funding of enterprise apps   Infrastructure renewal process   IT Steering Committee

  Architects on project teams   Technology research & adoption process   Architecture exception process   Formal compliance process   Centralized standards team

12

Getting from ‘as-is’ to ideal state

MIT/CIS 8090 Intro

Operating Model Defines integration and standardization requirements

Foundation for Execution • Core Business processes

• IT infrastructure

Enterprise Architecture

Engagement Model

Strategic Initiative Strategic Initiative





Establishes priorities

Learning and

exploitation

13


MIT/CIS 8090 Intro





Engagement Model







Learning and

exploitation

14


MIT/CIS 8090 Intro





Engagement Model







Learning and

exploitation

15

Alter’s Work System Framework

16

Alter’s Work System Framework

17

Work System Snapshot

18

Work systems are NOT Information Systems

19

Cognitive Map of 8090

IS Architectures as Strategy Weill, Ross & Robertson, “Enterprise

Architecture as Strategy”

Work Systems Models S. Alter, “Work System Method”

IS architectural components and development Mid-Range Modeling

Architectural Modeling options

ERP as instantiation of Architectures

Documents

CIS/MIT 8090 Intro