Summary of “Enterprise Architecture As Strategy: Creating a Foundation for Business Execution” by Jeanne W. Ross, Peter Weill, David Robertson (2006)

Summary of

Business StrategyTechnology and Digital TransformationStrategic ExecutionIT Management

Introduction
“Enterprise Architecture As Strategy: Creating a Foundation for Business Execution” by Jeanne W. Ross, Peter Weill, and David Robertson focuses on how organizations can create a robust foundation for business execution through effective enterprise architecture (EA). The book argues that a well-considered enterprise architecture aligns an organization’s strategy with its IT infrastructure to ensure cohesive and efficient operations. Here is a structured summary of the major points discussed in the book, along with concrete actions and examples.

Major Themes

1. Understanding the Core Concept of Enterprise Architecture

Major Point: Enterprise Architecture (EA) is not just an IT concern but a strategic enabler that ensures business and IT alignment.
Action: Shift the perception of EA from a purely technical domain to a strategic role that influences the entire business.
Example: The book cites the case of MetLife, which aligned its EA to better understand customers and improve service delivery.

2. The Four Operating Models

Major Point: Businesses should identify their operating model, which describes how a company delivers value to customers based on their unique strategy. The four models are:
– Coordination
– Unification
– Diversification
– Replication

  • Action: Assess and select the operating model that best suits the company’s strategy.
  • Example: The authors discuss Dow Chemical’s implementation of a Unification Model, resulting in a standardized set of business processes across all business units.

3. Creating a Foundation for Execution

Major Point: The foundation for execution is built on two critical components:
– An inclined digitized platform that offers necessary operational efficiencies.
– A robust enterprise architecture that supports this infrastructure.

  • Action: Develop a clear roadmap for creating a digitized platform that aligns with business objectives.
  • Example: ING Direct’s success in achieving low operating costs and high customer service levels by prioritizing a solid technology foundation.

4. Business Capabilities and Core Diagrams

Major Point: Core diagrams are visual representations that succinctly describe critical business processes and their IT dependencies.
Action: Create core diagrams to capture and communicate the strategic blueprint of the company’s operations and IT architecture.
Example: The book elaborates on UPS’s application of core diagrams to streamline its logistics operations, enhancing efficiency and service quality.

5. The Role of Governance

Major Point: Governance models that define decision rights and accountability are essential to align EA with business strategy.
Action: Establish a governance framework that promotes consistent decision-making and accountability.
Example: Cisco’s governance framework enabled the firm to decentralize decision-making while maintaining global standards.

6. Strategic Planning and Execution

Major Point: EA must be incorporated into the strategic planning process to bridge the gap between strategic vision and execution.
Action: Integrate EA processes into annual strategic planning cycles.
Example: At Carle Clinic Association, alignment of IT enabled better patient care through integrated information systems.

7. IT Engagement Model

Major Point: The IT engagement model defines how IT interacts with the business to support and innovate.
Action: Develop an IT engagement model that fosters continual dialogue and partnership between IT and business units.
Example: CEMEX implemented a robust IT engagement model to streamline production and supply chain processes, allowing for greater agility in responding to market changes.

8. Capability Maturity Model Integration (CMMI)

Major Point: Using models like CMMI helps in assessing and enhancing the maturity of the enterprise architecture and processes.
Action: Assess the maturity of the organization’s architecture using CMMI and plan for gradual improvements.
Example: State Street’s maturity assessment led to better risk management frameworks across its operations.

9. Architecture Review Boards

Major Point: Architecture review boards are essential for maintaining the integrity and alignment of EA with the strategic goals.
Action: Establish an architecture review board to ensure continuous alignment and review of EA initiatives.
Example: Kaiser Permanente used an architecture review board to oversee EA-related projects, ensuring they aligned with their strategic objectives.

10. Training and Development

Major Point: Building competencies and skills within the organization is crucial for sustaining enterprise architecture.
Action: Implement continual training and development programs focused on building EA knowledge and skills.
Example: Intel Corporation’s comprehensive EA training initiatives helped build internal capabilities, driving innovation and process improvements.

Practical Steps and Examples

Step 1: Identifying the Operating Model

  • Action: Conduct workshops involving key stakeholders to determine the most suitable operating model.
  • Example: Engaging leaders from multiple business units at Schneider Electric led to the adoption of a Diversification Model, allowing freedom to innovate while maintaining core standards.

Step 2: Developing Core Diagrams

  • Action: Use business and IT teams collaboratively to create and refine core diagrams.
  • Example: Pfizer’s internal teams worked together to document the company’s research and development processes, enhancing efficiency and regulatory compliance.

Step 3: Establishing Governance Structures

  • Action: Develop policies and frameworks that articulate decision-making rights and responsibilities.
  • Example: The implementation of a governance model at Procter & Gamble streamlined decision-making across global operations, ensuring alignment with corporate strategy.

Step 4: Integrating EA into Strategic Planning

  • Action: Ensure EA considerations are a standard part of strategic planning discussions and documentation.
  • Example: At Commonwealth Bank of Australia, EA was tightly integrated into strategic planning, enabling the bank to fully leverage emerging technologies.

Step 5: Forming Architecture Review Boards

  • Action: Set up regular review cycles and reporting mechanisms for the architecture review board.
  • Example: At Eli Lilly, the architecture review board regularly assessed IT projects, ensuring each aligned with the company’s strategic directions and compliance requirements.

Step 6: Building Internal Competencies

  • Action: Establish continuous learning paths and certification programs focusing on EA.
  • Example: IBM created a mentorship and certification program for enterprise architects, fostering a culture of continuous improvement and expertise.

Conclusion

“Enterprise Architecture As Strategy” emphasizes that an effective enterprise architecture is instrumental in executing business strategy. By understanding the enterprise architecture’s strategic role, choosing the right operating model, establishing solid governance, and integrating EA into strategic planning, organizations can significantly enhance their ability to execute their strategies effectively. Practical steps, supported by real-world examples, offer a roadmap for companies aiming to build a reliable and agile foundation for business execution.

Business StrategyTechnology and Digital TransformationStrategic ExecutionIT Management