What is Business Architecture? And why do I (and others) think it is important?
Business Architecture…. Here are some definitions — compliments of the altruistic, co-producing author/worker bees at the “knowledge beehive,” Wikipedia — for this topic, a source as good as any:A business architecture is a part of an enterprise architecture related to architectural organization of business, and the documents and diagrams that describe that architectural organization. People who help build business architecture are known as Business Architects. Business architecture bridges between the enterprise business model of an enterprise or a business unit on one side and the business operations that implement the business architecture on another side. Business Architecture articulates the structure of an enterprise in terms of its capabilities, governance structure, business processes, and business information. The business capability is “what” the organization does, the business processes, are “how” the organization executes its capabilities. In articulating the governance and information, the business architecture considers all external actors to an enterprise (including its customers, suppliers, and regulators), to ensure that flow in and out of the enterprise are captured. Business Architecture is directly based on business strategy. It is the foundation for subsequent architectures (strategy embedding), where it is detailed into various aspects and disciplines. The business strategy can consist of elements like strategy statements, organizational goals and objectives, generic and/or applied business models, etc. The strategic statements are analyzed and arranged hierarchically, through techniques like qualitative hierarchical cluster analysis.
So, what can we make of all this? Business Architecture is a way of systematically describing the elements and processes, actors and interactions of a business, both within and outside of its enterprise boundaries, and in a specific economic context: that of accumulating residual value by delivering value to customers. It is a business blueprint that spans strategy, operations, and systems.
So why has Business Architecture, as such, become an emerging discipline of late? In my opinion, it is because there is now a need, in the current business environment (characterized by rapid change), for a systematic approach to choreographing business strategy, operations, and the central nervous system of a business organization, its enterprise IT systems. Strategy is a mature systematic discipline for analyzing and defining the future value-creation paths of a business. Operations activities are increasingly being organized and managed under BPM paradigms and methods. Systems are being organized and managed under well-defined, systematic paradigms and methods as well. However, all of these are distinct perspectives and approaches and are, at the levels of both methods and practices, not integrated.
Business Architecture has the potential to be a standard conceptual and methodological framework that integrates and enhances the performance of business strategy, operations, and systems execution over a business’ strategic time horizon. But just as BPM and IT development/management disciplines developed and evolved over many years (from within manufacturing and then extending to services) to more mature disciplines, so is the case with Business Architecture, which is at a much earlier stage of development than the BPM and IT disciplines (and is actually shaping itself, in part, by borrowing from these other disciplines). That being said, we might expect that, under current economic/business, technological, and collaborative knowledge generation conditions, the Business Architecture discipline will emerge more rapidly than BPM and IT (where, respectively, Six-Sigma dates back 30 years now and Agile dates back 20).
It is my belief that in the global hot-house of evolutionary development that we have now already entered into (that of technology-enabled–and created–services), Business Architecture will become an essential discipline practiced by successful businesses in the early 21st century (just as the now mature discipline of strategy became an essential discipline of successful businesses in the mid 2oth century and specific BPM and IT disciplines became essential as well in that last quarter of that century).
If this discussion was not obtuse enough, in a subsequent post, we will look at the questions: “Who was Zachman? And why should we care?”