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Proposal for an Enterprise Business Architecture
Denise BedfordInformation Quality
Revised February 19, 2007
Purpose & Overview Purpose of the presentation is to:
propose a framework and strategy for aligning IT to business through the development of a business architecture
Hear the Architecture Committee’s advice on the value and feasibility of moving in the direction of a business architecture
Presentation Overview
Value of Business Architecture Designing a Business Architecture Business Process Management
Value of Business Architecture
Business Challenges Business is facing:
Global business competition Rapid innovation and fast-changing business requirements Regulatory compliance challenges Increasing cost pressures
Technology’s typical response Slow delivery times High maintenance costs Brittle solutions Stove piped functional applications Redundant development efforts and operations Redundant and costly investment in multiple technical solutions
Can technology be realigned to support the needs of business?
Aligning IT with Business There is little disagreement within or outside the organization that we need to
align information technology to support the business
We need to decide:
What we expect to achieve from the alignment and how will we measure it What alignment means from a business and from an IT perspective What strategy we will use to achieve the realignment
The decisions will be made at the enterprise level so there needs to be an enterprise context for the realignment
The realignment needs to support decentralized development and business evolution in the future – to achieve this we need a business architecture
Expected 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 objectives
What 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 view
What is required to implement a business architecture? Alignment takes the form of a fully elaborated Business Architecture
What 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
Value of Business Architecture
TechnicalBusiness
Optimization
Info
rmat
iona
l
Change ManagementRecords Capture &Management Improvement
Process Optimization Financial Management & Control
Systems Interoperability
Business Intelligence & Benchmarking
Data Quality Control &Assurance Improvements
Business Impact Analysis
Application Reuse
Focusing on supporting the business, and casting technology in an enabler mode, will generate direct and derivative results.
Business Semantics & Sharing
Role Management
Derivative ResultsDirect Results
Workflow Design & Support
Business & 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)
Business & 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)
Business & 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)
Business & 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)
Designing a Business Architecture
Designing a Business Architecture In order to align technology with business, we need to design a business
architecture
Business architecture includes: Business framework to which all business definitions and models
can be mapped
Business process management best practices for representing business processes which are manageable by business analysts, understandable to business managers and executable by developers
Current 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 documentation
Current business definitions may be constrained to what single organizational units do and how they do it
May be variations on a process across the organization Formal policies and procedures may not fully describe how work is done May be gaps in coverage of some business processes May be redundant descriptions of the same process which are not
consistently maintained May represent a technology view rather than a human workflow view May not describe all of the resources that are required to support a business
process
Current 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 processes
We propose a new framework which will allow us to harmonize these views – this framework takes the form of an organizational business taxonomy
Business FrameworkStrategic Alignm
ent and Aggregation
End to End Primary Business Activities
Business Subprocess and Tasks
Business Processes
Lines of Business
Business AreasOperations
Financial Administr
ative & Corporate
Lending
Analytic a
nd Advisory A
ctivitie
s
Project Identific
ation
Project Preparation
Project Appraisa
l
Project Negotiation
Project Approval
Prepare AIS in SAP
Prepare SMO
Prepare PCN, PID, ISDS
PCN Review Meeting
ROC and/or OC revie
w
Bank’s Business Framework Level 1: Business Areas
High 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 Business Set 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 management
Level 3: Business Process End-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 Tasks Individual 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]
How to Determine if it is a …..
Criteria Line of Business Business Process
Definition There must be an accepted and published definition of the line of business, including all products and services
There must be defined conditions marking the initiation and completion, and a sequence of steps in between.
Policies & Governance Processes There 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 & Services
vs. Inputs & Outputs
The 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. Expenditures The LoB has a defined budget line. Business process incurs individual expenses which can be tied to tasks or subprocesses, for all types of resources.
Risks There 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 & Metrics LoB 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 & Stakeholders LoB 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.
How to Determine if it is …Criteria Line of Business Business Process
Human Assets LoB 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 Assets
Supported 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 Sector
Has 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 Processes
Must 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 Area Is aligned with a Business Area as defined by the organization’s strategic and performance contracts.
Not applicable.
Line of Business vs. Business Process These terms are often used interchangeably in the business
literature but it is important to distinguish them because
Line of business is generally one level above where we can do business process management effectively
Line of business is comprised of multiple business processes – each of which represents an end-to-end process
Let’s consider what would happen if we tried to do business process management at the Line of Business level
Business Processes
The 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 goals
The top two levels of the framework (business areas and lines of business) provide us with a strategic view of the Bank’s business
The 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 management
Let’s focus on Business Processes and Subprocesses in order to identify the kinds of business knowledge we need to support the business
Project Approval
Project Identification
ProjectPreparation
Project Appraisal
Project Negotiation
Project Evaluation
Project Signing
ProjectEffectiveness
Project Supervision
Project Completion
Lending Line of Business Comprised of Linked Business Processes
Business Processes
Steps & Subprocesses
Resources Allocated andManaged at these levels
Decision mtg package Minutes, PID, ISDS SMO Notice to Borrower Draft Aide-memoire Post-appraisal letter to Borrower.
Prepare AIS in SAP Prepare SMO Prepare PCN, PID, ISDS PCN Review Meeting ROC and/or OC review (for projects high risks)
Draft PAD PID PAD-stage ISDS Draft EA, RAP, IPDP Minutes of PCN meeting Minutes of QER
Process Variations are found and Improvements are made at these Levels
Line of Business level is too coarse to support process management goals and objectives
Application calls areExecuted at this level
Lend
ing
Line
of B
usin
ess Lending Line of B
usiness
Business Process Management Best Practices
Business 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
Business 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 process
ARIS framework provides us with a comprehensive view of a business process description
Working 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
Environmental Data
Information Services
Other Services
Material Input
FinancialResources
Initial Event Message
Business Process
Steps & Subprocesses Result/Event
Information Services
Other Services
Material Input
FinancialResources
Goal
SoftwareComputerHardware
MachineResources
Human Input/Output
OrgUnit
Business Process Description
Robust description of a business process includes all elements of the ARIS framework.
Business 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 process identify the people who support it link financial resources acknowledge but also cross organizational boundaries identify compliance (financial, records) points identify data and information quality control points Identify common steps and subprocesses to simplify and reuse
applications provide managers with the capability to monitor the process for
improvement and planning purposes
Project Approval
Project Identification
ProjectPreparation
Project Appraisal
Project Negotiation
TL prep. PCN package and Sends to SM TL prepares if applicable ROC and SM clears TL prepares OC and SM, CD, RVP clear
Info
rma
tion
Bu
sin
ess
Pro
cess
AIS, SMO, BTOR PCN, PID, ISDS Cover Memo, Note Agenda Minutes of PCN review
SAP, IRIS, Passkey, ProjectPortal, Lotus Notes, Travel Web
W2K, Domino, Edge Server,HIS, Oracle, WebSphere, Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise Luminate
Ro
le &
Re
spM
etr
icT
ech
no
log
y
TT prepares QER package SM Clears TL circulates TL prepares minutes of QER and SM clears and Issues minutes
Decision mtg package Minutes, PID, ISDS SMO Notice to Borrower Draft Aide-memoire Post-appraisal letter to Borrower.
Negotiations Package Formal Invitation to Borrower to Negotiate Minutes of Negotiation Summary of Negotiation Status of Negotiation notice
Final Board Package SCR & email to SECBO Regional Pre-board mtg Memo to MD Pre-board meeting Board Approval
TT prepares and CD, SM, LOAG2, CC clear TL prepares minutes and Lawyer, LOAG2, Leader of Borrower deleg. clear TL & Leader of Borrower delegation sign
TT prepares package, SM and CD clear TL prepares notice to Borrower and CD issues TT prep. aide-memoire, TL signs & delivers TL prep. post-appraisal letter SM-CL-CD clear
PAD, PID, ISDS Safeguards Documents Minutes of QER Agenda Email
TL prepares Board pkg, SM-FO-LY-CD clear Lawyer prepares SCR & signed by RVP, LEGVP, expert appointed by CG TL prepares NB-Board Approval & lawyer clears
IRIS, Passkey, Project Portal, Lotus Notes, LAS
Transmittal Memo PAD,,PID, ISDS Safeguards Documents Legal Documents Minutes, Agenda SMO, Aide-memoire Notice to Borrower BTOR, Letter
Memo, PAD, MOP Notice of Invitation Letter of Invitation Letter of Sector Policy Letter of Development Program Minutes
Transmittal memo form 2337 , form 1767 Board Doc Sub. Form PAD, MOP, speech Notice to Borrower SCR Report Form 14, Form152 Speech
SAP, IRIS, Passkey, Project Portal, Lotus Notes, LAS, Travel Web
W2K, Domino, Edge Server,HIS, Oracle, WebSphere, Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise Luminate
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, iPlanet, Solaris,Sybase, Replication Server,WebServer, Print Archietcture.
Prepare AIS in SAP Prepare SMO Prepare PCN, PID, ISDS PCN Review Meeting ROC and/or OC review (for projects high risks)A
ctiv
itie
s
Draft PAD PID PAD-stage ISDS Draft EA, RAP, IPDP Minutes of PCN meeting Minutes of QER
W2K, Domino, Edge Server,HIS, Oracle, WebSphere, Lotus Notes, Siteminder,iPlanet, SAP, AIX, HACMP,EMC SRDF, EMC TimefinderTSM TDF, Tivoli Monitor,Telalert, Precise Luminate
IRIS, Passkey, Project Portal, LAS, Lotus Notes
IRIS, Passkey, Project Portal, LAS, Lotus Notes
Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).
Time, Cost, Capacity, Vol Time, Cost, Cap, Vol, Quality Time, Cost, Cap, Vol, Quality Time, Cost, Cap, Vol, Quality Time, Cost, Quality
Ap
p
Project Evaluation
Project Signing
ProjectEffectiveness
Project Supervision
Project Completion
TL sends an invitation On signing TL prepares a notice to Borrower – signing and Lawyer clears TL sends signed Legal Documents to ACTCF
Info
rma
tion
Bu
sin
ess
Pro
cess
Notice of Signing Legal Documents Notice to Borrower Email FAX
W2K, Domino.
Ro
le &
Re
spA
pp
Te
chn
olo
gy
TL prepares a memo & letter and lawyer clears CD signs and sends Letter to Borrower
Procurement process Disbursement Financial Management
Completion report identifying accomplishm- ents, problems, lesson learned.
OED assess what works and what does not and learn from the experience.
Borrower submits a completion report to the Bank Board of EDs
Borrower prepares specs and evaluates bids. Ps ensures procurement Disbursement Officer authorize to withdraw fund FM maintains oversight of the FM project
Memo Notice to Borrower-letter Email
OED staff assesses the project and sends to CD, SM, SD, TL, etc.
IRIS, Lotus Notes, Passkey
Bid documents, Contract Bid evaluation report Minutes of bid opening Cost estimate sheet Technical &/or financial evaluation report FM Reports/Docs
Report that contains accomplishments, problems, lessons learned
OED evaluation report.
IRIS, Passkey, Project PortalClient Connection, LAS,Extranet, Lotus Notes
W2K, Domino.
W2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes, Siteminder, iPlanet
Edge Server, IHS, WebSphere, Oracle, SAP,Siteminder, iPlanet, LotusNotes
Notice of signing and signing ceremony Notice to Borrower – signing Signed Legal DocumentsA
ctiv
itie
s
Notice to Borrower – Declaration of Effectiveness
W2K, Domino, Edge Server,HIS, WebSphere, Oracle,SAP, Lotus Notes, Siteminder, iPlanet, Solaris,Sybase, Replication Server,WebServer, Print Archietcture.
IRIS, Project Portal,Lotus Notes, Passkey
Intranet, Lotus Notes,Passkey
Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).
IRIS, Lotus Notes, Passkey
Time Time Time, Cost, Cap, Vol, Quality Satisfaction Quality
Me
tric
Travel Monitoring -
Unit/VPU
Travel Planning
Travel Transacting
Travel Controlling
Travel Monitoring –
Specific Trip
Budget Analysts/Officers forecast travel expenses Traveler makes Reservation and enters Trip information into the Web Travel
Info
rma
tion
Bu
sin
ess
Pro
cess
Travel Authorizations Travel Advisory services and guidelines Trip Document created In travel web system Reservation – itinerary with American express
Online Reservation system,Travel Web, Passkey, Notes
W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert,Edge Server, IHS, WebSphere, Lotus Notes
Ro
le &
Re
sp.
Ap
pT
ech
no
log
y
Traveler contacts A. Exp AM approves the trip A. Exp receives Notice and issues the ticket Traveler enters expenses TCS is sent to Manager AM approves the trip
Pre-Trip Controls Post-Trip Controls Monitoring Specific Trip
Monitoring Specific Unit/VPU
Traveler can use the Web Travel System to monitor the status of trip request as well as sub- sequent expense reimb- ursement request
Ex Ante Controls: verify cost assignment, explanation of exceptions, PCard Usage, etc. Ex Post Controls: trip is approved, traveler sends receipt to ACT.
Itinerary VISA Ticket BTOR
Budget Analysts/Officers use the SAP Cost Report or Administrative Expense Report to monitor travel expenses
Travel Expense Postings Trip Document PCard Receipt
Display Trip Print/Simulate Trip My Trip Summary Report
Outstanding Trip Claims Report Travel Expense Exception Report Budget Summary Repor Operational Mission Summary Report
SAP, Travel Web, Passkey
W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert,Edge Server, IHS, WebSphere, Lotus Notes
W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert,Edge Server, IHS, WebSphere
W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert,Edge Server, IHS, WebSphere
Planning at Budget Level Planning Specific Trip
Act
iviti
es
Before the Trip After the Trip
W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert,Edge Server, IHS, WebSphere
SAP, Travel Web, Passkey SAP, Travel Web, Passkey
Metrics for Travel (Bank Wide: Over $ 200M in FY-05): Cost Effectiveness – Get Best Results with available Funds
Travel Web, SAP, Passkey,Notes
Cost Effectiveness Cost EffectivenessCost Effectiveness Cost Effectiveness Cost Effectiveness
Me
tric
Query-Imaging& Career mgt
Staff Benefits
Staff
Performance
Staff Payment
Recruiting
& Staffing
Info
rma
tion
Bu
sin
ess
Pro
cess
Ro
le &
Re
spA
pp
Te
chn
olo
gy
Act
iviti
es
Staff prepares
HR Forms
LARS, TAX Kiosk LMS, Parking System HR Ben Pension, Passkey NextGen Healthcare IS
PeopleSoft, Solaris, WebSphere, IHS, Oracle,SAP, Edge Server, AIX,Oracle, W2K, oracle report Server, ASP, Web
Staff prepares OPE, Manager approves Manager prepares and approves performance awards, awards for excellence
Payroll Staff Receivable Time Recording Post Allowance
Staff prepares
HR Forms
OPE Performance Awards system Awards for Excellence system
HR Forms
Payroll System Staff Receivable Syst TRS Post Allowance Syst
W2K, Domino, PeopleSoft,ASP, Oracle, Power Builder
Leave and Attendance TAX Computation Staff Learning/Training Parking, health services Pension Benefits Administration
OPE Performance Mgt Performance Awards Awards for Excellence
PeopleSoft, Solaris, WebSphere, IHS, Oracle,SAP, Edge Server, AIX,Oracle
Job Information Agency Recruitment Consultant & Staff app. YP/JPA Recruitment HARP Retiree E-recruitment
HR officer prepares
HR Forms
W2K, Domino, W2K, IIS5, ASP, Oracle, Edge Server
Job World CATS YP System, JPA FARP Retiree System eRecruit
HR Query HR Imaging HR Kiosk Internal Communications
Staff
HR Forms
W2K, Domino, W2K, IIS5, ASP, Oracle, Edge Server
Yournet HR Query HR Imaging HR Kiosk
Metrics for HR Management: OPE, Performance Award, Award for Excellence, Time, learning
OPE, Perf. Award, A for Exc Time Time learningTime
Me
tric
Current 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 focus
In other cases, business processes are described as documentation (business procedures, administrative manuals, operational procedures, etc.)
For some processes, there are neither models nor procedural documentation
Recommend 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 it Identify gaps in existing processes Determine what is needed to fill the gaps
Business Process Model Registry Design an enterprise level repository for business process models consistent with
enterprise architecture best practices
Establish a registration and review process for all business process models which is consistent with the Business Architecture governance model
Empower business analysts to: Discover and inventory existing business process models Identify redundant models Identify variations in practice Identify and link models that describe steps or subprocesses in the same
business process Identify business processes which are not described by BP models
Standards-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 applications
However a fully developed business architecture presumes a cross application, business-oriented service oriented architecture which is grounded in standards
Although the standards are not yet widely adopted, some major application vendors are supporting OASIS: BPEL for defining process flows WSDL for defining the interfaces to services used by the process XSD for defining the XML data structures used by the process
Establish Business Architecture Governance Model Because the business architecture has such high value to the organization, it
needs to be managed at the enterprise level
Because the business architecture is cross-organizational and cross-applications, roles and responsibilities associated with building and sustaining it need to be clearly defined and supported
We 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 Program Business Analysts Technical Custodians
Governance & Stewardship