Enterprise IT architecture is difficult to launch due to its frequent positioning as a technical endeavor. In reality, it's a prerequisite for evolving business models and strategies, including the real-time enterprise.
CIOs and architects often struggle to obtain business leader buy-in for enterprise IT architecture (EITA). This is generally a result of how the benefits of architecture are positioned, as well as business leader mistrust of anything that potentially diminishes their autonomy. The key to obtaining business commitment to architecture is to justify it in business -- not technical -- terms. Too often, IS leaders confuse the capabilities of a technical architecture with the business capabilities that it enables. EITA exists solely to facilitate modern business models and strategies. The benefits of these business models and strategies -- not the innate abilities of a systems integration architecture, for example -- provide the justification for investment in and adherence to an architecture. Chief among these emerging models and sources of justification is the real-time enterprise (RTE).
The RTE
The RTE is fundamentally about squeezing lag time or "information float" out of core operational and managerial processes. Business has long understood that time is money and speed is a competitive advantage. However, "time" is taking on new meaning as access to markets and talent pools becomes global, and as innovation cycle times and product life cycles shrink. The ability to remove latency or lag times from key business processes, to extend processes globally to "follow the sun," and to access real-time financial, managerial and operating data will increasingly separate industry leaders from also-rans. In time, RTE capability will be a requirement for staying in business.
Supply chain strategies provide an excellent example of the RTE in practice, and illustrate its dependencies on architecture. A thorough understanding of this type of RTE initiative and its importance to business leaders will help IS leaders translate EITA capabilities into business benefits and justifications.
Figure 1 illustrates a hypothetical manufacturing supply chain with raw materials and work in progress (WIP) moving between various parts of the world to take advantage of global, best-in-class partners or other economic advantages of a region.
The business realities of such supply chain processes can be quite painful. Each process:
These realities add significant complexity, cost and risk to one of the most basic, common business processes, but the analogy applies equally to service sectors and knowledge-based work such as design and engineering. Simply put, moving materials, information or WIP around the world, and making rapid adjustments amid changing conditions requires robust, timely information. This information is housed in business software applications. Those applications must seamlessly interact and share information if the process and its outputs are to be effectively managed. EITA provides that technical capability. Its justification, however, lies in the business problems it solves. What, for example, would the following capabilities be worth to an enterprise?
In enabling the RTE, these are only some of the business benefits that an EITA can deliver. Capturing and quantifying these capabilities provides the business-based justification for successfully selling and implementing an enterprise architecture. The trick is to go beyond the inherent technical abilities of architecture -- such as the ability to rapidly and seamlessly extend data and processes across geographical, technical and organizational boundaries -- and to position the architecture by addressing why such RTE capabilities are valuable to the business.
It is also important to understand that new business models may require new or ongoing architectural investments. IT advancements make new business capabilities possible; the pressure for new business capabilities fuels investment in IT R&D. There is a symbiotic relationship between the two, and because of this, no technology or architecture has a finite shelf life. If the business expects to accelerate its operations and critical decision making by leveraging IT, its IT investments may also need to accelerate to take advantage of rapidly evolving capabilities. Those new technologies will, in turn, require periodic reconsideration of architectural frameworks and constructs.
Bottom Line: The real-time enterprise (RTE) is profoundly important to the future of global business. As most CIOs and enterprise architects are aware, the RTE is fundamentally dependent on architecture. Understanding that dependency, and positioning architecture in terms of the business problems it solves and the time it extracts from core processes, will provide the business case and performance targets necessary to achieve business leader commitment.