Lost in translation?
For many companies, virtually every significant change to their business has an equivalent impact on their technology infrastructure. For the business to roll with the punches and come out on top, the IT organization has to be ready to respond in like fashion, just as quickly. But in practice, the hurdles standing in the way of this type of fast action can seem insurmountable. Many IT infrastructures are set up without a common language in place that cuts across different enterprises, making it difficult for strategic decisions to be effectively translated into the organization’s technology foundation. That’s where enterprise architecture (EA) can make a difference.
Effective enterprise architecture encompasses both business and technology, so it requires a broad range of experience, knowledge and skills in everything from strategy and operations to technology integration, security and human capital. Deloitte has access to a full range of capabilities in consulting, tax, audit, and finance worldwide. Learn more about the offering.
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- Scott Rosenberger, Principal, Deloitte Consulting LLP
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Speaking the same language
For technology leaders who have been around long enough, it usually doesn’t come as a surprise to them that their systems and infrastructure aren’t operating in an aligned fashion. That’s just what happens in a mature organization, where new companies and technology portfolios are routinely acquired, shifts in business strategy change technology goals, and islands of sophistication emerge as leaders push their teams to new heights. Although these are mostly positive changes, they can have a devastating cumulative impact if they’re not managed properly. The real question is often when to take action – and how.
Enterprise architecture is the practice of creating a technology structure that brings an organization’s processes, information systems, personnel and discrete operating units into tight alignment to support its core goals and strategies – no matter what twists and turns they make. While it involves a heavy technological component, it’s multidisciplinary, linking together business managers, technology managers and technology implementers. A technology-focused approach isn’t enough.
How we can help
Effective enterprise architecture encompasses both business and technology, so it requires a broad range of experience, knowledge and skills in everything from strategy and operations to technology integration, security and human capital. Deloitte has access to a full range of capabilities in consulting, tax, audit and finance worldwide. This broad range of capabilities allows us to provide services to assist with any enterprise architecture challenge, including:
- Business strategy
- Business process reengineering
- Technology architecture
- Change management
- Facilitate complex program execution
- Enhance business participation and ownership of IT initiatives
- Link corporate strategy evolution with IT
- Provide a clear communication mechanism between business and technology
- Reduce costs of platform support and integration
- Ease the challenges of integrating acquisitions
Six ways to get more value now
Enterprise architecture can help you make better business and technology decisions and deliver solutions and services that fully align with your company’s strategic business needs. But getting there isn’t easy. Here are some lessons we’ve learned that can help you develop and maintain an effective enterprise architecture:
Start with business strategy. An effective enterprise architecture requires a deep analysis of your company’s business strategy and operating model – and the business and IT capabilities necessary to support them. It also requires strong commitment and leadership from both the business and IT. Enterprise Architecture initiatives that only focus on technology are likely positioning themselves for failure.
Capture value through improved business execution. A key goal for enterprise architecture is to help you improve efficiency by linking your business and IT strategies and pulling together the technology capabilities to support value creation. An effective enterprise architecture can help you drive out inefficiencies through the creation of a reference point for measuring investment value, and the transfer of spending from tactical areas to strategic areas.
Know where you are – and where you’re going. Enterprise architecture capabilities vary widely from one organization to the next. That’s why it’s important to honestly assess the maturity of your existing enterprise architecture capabilities. A maturity model can help you understand where you are – and where you want to go. That big picture perspective is a key to success, particularly for multi-year enterprise architecture initiatives. One good test is to understand how much influence enterprise architecture currently has with your business and IT organizations. If the answer is “not much,” you know you have some work to do.
Don’t forget about people. Having people with the right skills and experience is critical to success. That’s true both for enterprise architecture and for the business as a whole. An effective enterprise architecture effort can help you identify the kinds of talent that the business will need in order to achieve its strategic objectives. It can also help you identify the type of talent required to develop and maintain the enterprise architecture on an ongoing basis.
Actively manage change. An organization’s culture has a big impact on enterprise architecture adoption and maturity. An effective assessment will focus extra attention on organizational awareness, acceptance, adoption and competencies. The goal is to make enterprise architecture part of your organization’s basic operating model.
Be practical. Although enterprise architecture seems like a complex concept, it should not be treated as an ivory tower exercise. A useful enterprise architecture framework will provide real examples of how to achieve the desired capabilities. Similarly, architecture standards and governance models should be practical and tailored to fit your particular situation. Avoid copying a framework and blindly following it.
Enterprise Architecture in action
- After decades of quick fixes, point solutions, and homegrown workarounds, one of the largest rail freight operators in North America was left with a technology infrastructure that was loaded with risks and growing prohibitively expensive. We helped the company modernize its IT systems, starting from a business transformation perspective that used enterprise architecture to set the strategic direction of its IT resources. The initiative was then divided into multiple work threads – strategy and governance, portfolio and financial, and architecture. We helped define a five year vision for IT and created an extensive roadmap for getting there, including a new enterprise architecture. Today, this high-level IT roadmap guides technology initiatives for the company. Business needs are built into IT projects as a normal part of doing business, from operations and infrastructure projects to systems, information, security and integration architecture.
- A leading logistics and transportation company needed to reduce system and support costs for its Human Resources (HR) back office function. With more than 300 HR systems in use by the company, and with a plan to make the transition within three to five years, the company needed a careful accounting of which individual technologies and functions would have to be addressed in order to keep risk at a minimum during the transformation. Dependencies, resources and timing would also have to be clearly identified before the transformation got underway. We helped the company develop an enterprise architecture-driven business transformation plan including a timeline, staffing model and identification of potential risk areas. In the end, our program roadmap and strategic plan helped this client reduce costs and redundancies in HR systems by standardizing common processes across its operating companies. With this project, the company was able to simplify and streamline the application landscape and reduce infrastructure costs by having different operating companies adopt global HR solutions.
As used in this document, “Deloitte” means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.