In the last blog, Part 2. TOGAF and Architecture Roadmaps, we put forward a standard for a Consolidated Architecture Roadmap. Now, we need to begin to describe each layer of the Consolidate Architecture Roadmap. We will go from top to bottom; the most logical layer to go first is the one that drives scoping or strategic planning. The main question to answer is, “What are the competencies that must be in place to meet or exceed the company’s business objectives?” Once this simple question is answered, it drives the rest of the Consolidated Architecture Roadmap.
The main question to answer for the Business Operating Model layer is, “What are the competencies that must be in place to meet or exceed the company’s business objectives?” Once this simple question is answered, it drives the rest of the Consolidated Architecture Roadmap. It is a simple question, but it is currently difficult to find what do we mean by a competency and how do we describe this layer and roll it up to our Consolidated Architecture Roadmap.
Starting with Competencies in your Consolidated Architecture Roadmap
“What are the competencies that must be in place to meet or exceed the company’s business objectives?” is a simple question, yet to answer it in a systematic process requires pragmatic standards to be in place at your company. First, what is a competency? That is a separate blog for just that. Basically, a competency is something that your company does where you merge repeatable business requirements aka “capabilities” to the assets required to perform it. As an example used by one of my favorite companies, a competency may be something like “chicken disassembly” (apologies to you vegetarians); this competency is based on a manufacturing business requirement to be in the poultry processing business that uses specific assets like people, machines, and technology. How do you know which competencies to include in your Business Operating Model and, eventually, your Consolidated Architecture Roadmap, and how do you organize your competencies? The following figure show and expanded view the first layer for the Business Operating Model, plus the other layers of the Consolidated Architecture Roadmap.
Organizing the Competencies: Competency Map
Within the Business Operating Model, you need structure in order to manage the competencies in your company. The following is a map, called a Competency Map. There are many variants that exist in industry, such as the SAP Solution Composer Application Map, IBM Component Business Model, and the Competency Map, referenced by the Open Group TOGAF framework. The Competency Map is decomposed from the most coarse granular to fine granular:
- Business Model Categories – 8 Columns in the example below that would typically correspond to a domain
- Business Model Competency Group – Individual blocks or logical groups of competencies, such as Facility Management
- Business Model Competency – An individual competency combining one or more capabilities (aka “reusable business requirements”) with the assets deployed to realize those capabilities. Remember our “carnivorous example” above.
- Business Model Competency Element – If required, an additional decomposed level for a competency.
A growing practice is to relate the competency decomposition to the process decomposition. We will cover that in Part 4 of the Business Process Layer of the Consolidated Architecture Roadmap.
Finding Value Opportunities as a Paradigm for Deriving Competencies
Next, you need a logical paradigm for determining the competencies that you should focus or the ones that should create or preserve value in your organization. Value is another word that we use, without precision of what is means to us in business. Value is the ratio of “utility” relative to the cost to achieve that level of utility. Utility in a business context is a judgment of:
- capabilities – ability to effectively satisfy capabilities or recurring company business requirements
- differentiation – ability to attain additional margin
- competitive – ability to maintain a competitive position or maintain margin over time
- health – ability to maintain health of basic competencies to keep the company operating, usually a measure of efficiency
You need a process to find value opportunities. You may use the following:
- Company Business Strategy
- Industry Trends
- Technology Trends
Additionally, you may use the SAP Value Engineering VLM (Value Lifecycle Management) tool. The following diagram shows possible criteria for evaluating the value opportunities to determine the competencies to focus for the Business Operating Model.
Summary of Business Operating Model Layer
- Start with Business Modeling to build a Consolidated Architecture Roadmap
- Focus on Prioritizing Competencies and Capabilities where there is value
- Incorporate Capabilities into the first layer of the Consolidated Architecture Roadmap
- Use the Capabilities and results of Architecture Vision Phase of ADM to build the Business Architecture
- A Business example is overdue
Next time, in Part 3b, we will go over a generic version of a real business example starting with a capability map and then applying a simple paradigm to derive the value opportunities and the competencies that should be in scope for your Consolidated Architecture Roadmap. Stay with me, we will need to dive into details and then come back out, always coming back to our ultimate objective of having a pragmatic, Consolidated Architecture Roadmap.
This blog is based on the ASUG Enterprise Architecture Roadmap Days. Be sure to attend one of the events coming to a city near you. The next even is in Atlanta on November 4th.
Also, there is a Roadmap Preconference Session at TechEd 2010 in Las Vegas. You will meet with more of the though leaders who have developed the SAP product roadmaps and meet with your colleagues who are developing best in class company architecture roadmaps.