Core Foundation for Building an Enterprise IT Architecture
Many efforts toward creating and maintaining an ideal digital work environment with a smooth and seamless workflow go to waste. Even when stakeholders are equally involved, departments’ actions are aligned, finances are managed efficiently, and research teams are monitoring the latest trends in the industry unless the execution is backed by a mature enterprise architecture (EA). A mature IT EA is often based on a solid EA foundation, strategically aligned, and tailored to the business needs.
In this chapter, we will cover areas that contribute to an effective foundation for execution. Therefore, we will cover the following topics:
- The EA strategy begins with building a core foundation
- The core foundation for execution strategies
- Building a business-specific core foundation
- EA domains
- Business dynamics versus IT complexity in businesses and IT systems
The EA strategy begins with building a core foundation
The EA strategy is the process of translating the business’s vision and strategy into effective enterprise change by creating, communicating, and improving the key requirements, principles, and models that describe the enterprise’s future state and enable its evolution. If we compare EA with its strategy, we can identify EA as a discipline for proactively and holistically leading enterprise responses to disruptive forces. It does this by identifying and analyzing the execution of change toward desired business vision and outcomes.
We live in a digitalized world where everything is automated. The need for an up-to-date IT infrastructure is more crucial than ever. Each aspect of modern life is in some way directly or indirectly associated with the use of technology. To keep technology running smoothly, being able to execute the core operations reliably is the top priority.
Business architecture is fundamentally about configuring IT resources in support of a company’s business strategy. It brings together certain aspects, such as a company’s strategic goals, its workflow, and the information it creates, as well as the infrastructure that underpins it. As part of its technology blueprint, EA determines not only what technology it currently possesses, but how future technology upgrades can be used to complement or enhance its current technology.
However, apart from providing a strategic and business context to systems, the EA strategy provides an improved approach to looking at them holistically. It has been described as more of a management process that helps businesses with organization, resource allocation, and implementation. Organizations benefit from EA strategies in many ways. It allows them to review their IT status and IT goals in a comprehensive manner:
- Stability is improved as a result of standardizing processes and applications. Simplifying processes allows businesses to be more efficient and reduce the risk of problems.
- As an organization expects from EA, it reduces the complexity of systems. The right tools simplify system administration and management.
- By allowing the causes of problems to be identified quickly, organizations have been able to prevent bigger issues.
- Organizations are more agile thanks to EA. This allows them to analyze changes in the industry and respond to them promptly.
- Keeping an eye out for weak points in the system can prevent threats from entering the system. Cyber security breaches today are being addressed using systematized measures determined by EA.
In today’s competitive marketplace, innovation rules the day, and opportunities to innovate are virtually endless, especially when it comes to applying technology to modernize processes, products, and services. Global market leaders, such as Dell, Capital One, and Walmart, have taken over their industries at a massive scale. While this development seems encouraging for the global economy, other companies with comparatively slower growth ratios must reconsider their plans of action.
In a survey of 103 US and European companies, 34% have a digitized core infrastructure and leverage modern technologies for a higher profit, faster time to market, and a better value from their IT investments. Such a core infrastructure ultimately leads to a 25% lower operational cost, better customer experience, lower risk of system failure and data loss, and higher satisfaction among stakeholders regarding technological advancements.
This chapter is based on insights into the stats, tools, strategies, and fundamentals applied by 500 US, European, and Asian companies for an effective foundation for execution. These elements provide the right substratum for large, medium, and small businesses to set their operations in the right direction by digitizing them. We will deep dive into their strategies and learn how they exploit their foundation for execution to achieve business agility, which leads to noticeable growth.
Automating routine tasks in an organization from top to bottom is the way to move forward in the coming years. This means minimizing or even eliminating human involvement in repetitive, manual work, such as food processing, supply and delivery operations, invoice generation, and payment processing. Building an effective core foundation for execution requires a capable infrastructure to handle this automated and digitized workflow without any chances of errors occurring. Organizations that maintain a reliable network and predictability in routine operations set organizations apart from their competitors.
We like information to be at our fingertips, just a click away from execution. In light of that, the food processing industry requires a transparent flow of information across the board, from customer orders to shipping, maintaining inventory, and delivering products and services.
7-ELEVEN Japan is the eighth largest retailer in the world. Climbing this ladder of success, the company’s team leveraged the foundation of execution for their 10,000 stores to capably manage all of their inventory. The company’s digitized process of collecting data at the point of sale using 70,000 computers allows users to place orders online and connect with the manufacturers for direct and effective communication. This automated and centralized mode of conducting business makes it possible for companies to develop new products each year.
A common misconception about the digitization of core business operations is that organizations must focus their energy on competitive capabilities. However, success lies in the strategy, where, every day, mundane processes are combined with complex tasks. This begins the digitization process with common services such as recruiting, investments, and telecommunication and then moves toward more bespoke components. With a smooth and seamless workflow for employees who use these systems every day, management has the freedom to let go of low-value tasks and focus on revenue, innovation, and growth.
The elements of the core foundation
Whether the goal is cloud computing, robotic process automation (RPA), or machine learning (ML), organizations must constantly evaluate new technologies and the ways they can or should be incorporated into their business strategies. Continuous innovation requires an EA that is well designed and documented, with clear processes for achieving the desired business outcomes. By definition, a well-designed EA is an architecture model that draws a big picture of the entire organization, with a long-term view. This blueprint explains the business processes, hierarchical structure, information systems, and technologies. It also allows modern innovations to be adopted. Let’s take a look:
Setting up and implementing a single model is one thing while ensuring productivity across the board is another. A team must keep track of every move within the organization to ensure the business goals align with the IT infrastructure.
The framework provides the foundation for the architectural model, along with basic guidelines and principles. These practices are defined for all stakeholders under this framework so that they can align their work ethics with the system.
- Implementation of the development methodology
There are ways to implement methodology smoothly across the board while making sure that critical business operations are not disrupted. However, ensuring there’s a seamless and effective implementation may take longer than expected.
- Effective governance
This ensures that an EA program is managed properly to produce artifacts and plans that are truly representative of the organization’s goals and needs. EA governance also ensures that business and technical decisions become aligned with the EA from initiation to implementation.
- Documentation artifacts
The repository defines and documents the resourcefulness of the organization during the implementation process. It also contains the tools that are essential for accomplishing the goals defined by the framework.
- Best practices
A set of best practices and guidelines are used to guide a sturdy workflow and review the existing architecture. These practices ensure transparency and productivity. This can have a trickle-down effect that can help establish a better understanding of the drivers of growth and innovation.
The core foundation for execution strategies
The need for an agile business model has never been more crucial. Especially with the COVID-19 pandemic, many industries have suffered irreparable losses that can only be recovered or avoided in the future with a more adaptable business strategy and innovation model.
Companies that had already embraced cloud infrastructure and an agile workflow adapted to the pandemic more quickly than digital laggards, who struggled with the remote work model and keeping customers happy.
EA maturity models are a way to assess the maturity of functional domains. They distinguish different maturity levels that an organization successively progresses through. As such, they can be used as a guideline for balanced incremental improvement of a functional domain.
EA is all about providing direction to IT regarding where to invest – that is, how to make the right technology choices to deliver business value. When it comes to predicting the impact on business value and outcomes, EA management tools provide crucial guiding elements for the process.
Now, let’s look at some of the typical initiatives to ensure that an EA program is being tracked correctly.
Leadership and vision
A company’s short-term tactical steps and long-term enterprise architectural vision must be aligned. To ensure EA success, leadership must take steps to ensure teams are educated on relevant initiatives, focused on business values, and equipped to do their part in moving the organization and processes toward the common end goal.
It is especially helpful to get early alignment with every individual involved in the decision-making process for an organization to quickly move toward the common end goal. Buy-in across the business makes it easier to avoid unspoken concerns, uncover potential issues, or manage other factors that can derail an EA program.
Strong leadership paired with the right stakeholders in place across the board is essential to ensure tasks, milestones, and performance are moving in the right direction. Aligning the vision and interests of all stakeholders with a properly designed network is a huge challenge that will require processes to ensure teams and processes are operating as designed and intended.
Driving toward a future-centric approach that is in sync with leading technological advancements is imperative. EA should prepare an organization to confront known challenges and be flexible enough to leverage emerging technology. Indulging in current issues and struggles between legacy systems and innovation can be devastating when you’re trying to achieve EA business goals and values.
CIO and business leader harmony
Stakeholder leaders must work together to ensure divergent viewpoints can be heard and addressed harmoniously. When the EA infrastructure is not sturdy enough, diverse opinions can make it tricky to resolve issues that come down to technology versus business.
Balance business and technology
Some may let the technical aspects of an EA operation take over an entire business environment. A more balanced approach is better, where business and technology requirements and the strategy are considered and information is shared to ensure effective operational processes.
There is a world of business opportunities out there, but finding the right team that is skilled and motivated to seize this opportunity can be a struggle. Organizations should strive to assemble a team that reflects a diverse blend of individuals who, among them, possess deep business acumen, technical understanding, and enthusiasm for the vision.
Technical input, business process, and performance measurement come together to form the basis for gauging the benefits of EA. Leaders must establish goals that focus beyond short-term achievements and strive for long-lasting impacts for each key performance indicator (KPI) associated with the EA vision.
Interoperability and integration
In our constantly evolving digital world, a team’s ability to adapt to new changes is essential. To ensure this, the sustainability and a credible EA must be as future-proof as possible, with easy integration and operational flexibility that is supported and enforced across the board.
The right communication design can make or break the success of an EA organization, so this aspect of the work must not be taken lightly. Every stakeholder must be on the same page strategically speaking, and teams must be aware of the latest EA advancements within the organization. It is important to communicate the layout, benefits, and scope of the architecture.
Resilience – the key to EA
Before and during the pandemic, EA experts have been in great demand to assist with the immediate and future migration of business applications to the cloud. They have also been engaged in multiple facets of transformation, depending on their business roadmap, risk assessment, feasibility, security, budget, development strategies, and other factors. EA teams have influenced the hastening of transformation and related processes.
EA translates company strategy into identified objectives to enable business capabilities. When executed well, EA translates business objectives into clearly defined transformation initiatives that analysts, portfolio owners, IT solution architects, and others across the business can move forward in their areas of focus.
In times of crisis, EA facilitates business continuity by focusing resources on the company’s critical capabilities and accelerating recovery once the crisis has passed by, making the most of the new environment. EA supports resiliency, which can help a business not only survive a crisis but thrive post-crisis.
The following diagram shows the process of establishing a knowledge-oriented mentality in a firm, analyzing the current knowledge, and planning the knowledge that will be needed in the future. However, the strategic level portrays identifying the existing knowledge and how to effectively and efficiently allocate that knowledge within a firm.
Figure 1.1 – Scope of EA
Table 1.1 – The category of EA value is supported by evidence from the literature
Building a business-specific core foundation
An organization aligned with EA principles must have EA leaders who are thinking ahead about certain elements of the process to keep the workflow smooth and seamless. The size of the team, infrastructure model, and organizational structure are at the top of the list. Individuals or teams that are working together on a project with a common goal may have a different approach, but the work ethic and EA model must be aligned to maintain an effective workflow and ensure the agility of operations:
- Understanding EA stakeholders
Attracting and identifying the set of stakeholders, including customers, that meet certain criteria is the top priority for an organization looking to transform its EA model. Each stakeholder holds a position with specific needs that can be fulfilled by the credible EA structure. For instance, while setting the foundation for the business value from technology, a CIO is likely to have a set of queries about the application roadmap, investments, and cost structure. Referring to the application life cycle map, financial matrix, and cost heatmap can help find answers.
- Involving EA stakeholders
Getting the right team and having them on board is likely an easier task than keeping them all aligned and providing continuous support and effective communication. A stakeholder engagement initiative will vary based on an organization’s structure and EA program scope, but it typically involves the following progressive levels:
- Develop a strategy: Plan the approach, keeping in mind the ongoing processes that must be maintained, to retain key stakeholder support
- Understand the organization: A firm grasp of the organization’s history, culture, and key stakeholders makes it easier to assess and identify best institutional practices
- Assess current competencies: Use analytics, organizational insights, and data to scope steps for desired outcomes
- Operate and evolve: Set up EA operations based on organizational guidelines and continuously evolve the effort amid industry and organizational developments to generate and maintain stakeholder support
- Choosing an operating model
It is important to build a model that fortifies the organization and can deal with arising internal or external issues efficiently. It is the first step toward the foundation for execution in EA.
Each model is different from another, based on the organization’s core values, goals, and program size. Here are the most common EA operating models:
- Coordination Operating Model: Autonomous business units control the business process design and adapt to its operations.
- Unification Operating Model: A matrix approach is used to integrate a global set of business processes with centralized management. Under this model, higher management stays focused on standardizing business processes across all units.
- Diversification Operating Model: Every business unit is unique, with a set of independent transactions. Apart from a minimal business process standardization, most IT decisions and business choices are made independently using a set of shared services.
- Replication Operating Model: Business units leverage a federated approach for integration and standardization. The workflow is centrally managed, but data is locally owned, with some aggregation and sharing with the enterprise.
- Defining the structure of the EA team
How to structure the EA team is sometimes a constantly echoing question within an organization that is planning to build an in-house EA structure. Any decision that’s made in the beginning will have a long-term impact, and it is easier at this stage to garner organizational buy-in.
Despite having small teams, limited budgets, and little decision-making power, most enterprise architects are expected to implement powerful strategic technology programs. EAs can be distributed among leadership across an organization to strive for better alignment and a better workflow.
- Building an EA ecosystem
Building a network wider and wider by garnering buy-in from major stakeholders will ultimately achieve the maximum good. The core EA team should keep exploring the ways it works with the wider team and make improvements along the way.
The core EA team owns the overall EA structure, defines standards, and develops the business-aligned strategy. According to Marcus Blosch, research vice president at Gartner, instead of focusing on standards, structure, and control, organizations must widen their strategy toward driving business outcomes and work flexibly and creatively to define the future and how to get there. By adopting these traits, EA teams can develop a new group of talent to support digital business and digital transformation. They will establish competencies in developing a business strategy, designing new services and experiences, pursuing innovation, orchestrating collaboration across the organization, and navigating to the future.
Conversely, wider EA teams that consist of the solution, technical, and business architects are an extension of the core team. They work with other stakeholders in a constantly evolving, chaotic environment. A smooth and consistent flow of information among the core team and the wider team ensures a sturdier infrastructure and better outcomes.
- Size teams accurately
A large EA team may have 50+ individuals focusing on different architecture domains or EA overall, a medium team that consists of between 15-50 people, and a small team that consists of fewer than 15 people. Here is a list of factors that can help EA leaders determine the appropriate size for their team:
- Number of products and services within an organization
- Timing for revenue and profit calculations
- Maturity of the business process in an organization
- How efficiently accounts and finances are managed
- Organizational resources and the IT budget for advancements
- The rate at which an organization adapts to the EA
EA domains for building a core foundation
Stephen Spewak’s Enterprise Architecture Planning contributed greatly to the current popularity of dividing EA into four domains. While his approach was published in 1993, it is still in use today by most EA project teams.
Let’s look at the four domains of EA work.
This domain defines organizational structure while addressing who will be involved and what they will do within the company’s functional capabilities. Let’s look at some example questions that must be answered to represent this domain. In general, a business architecture includes business processes, business capabilities, services, operating models, and value streams. What are the business vision, strategy, and objectives? Who is responsible for driving toward and achieving the anticipated goals?
This domain considers the relationships between specific applications and the core business processes of the organization while asking the question, how have current business capabilities been implemented? The process of tailoring software solutions based on evolving needs is addressed in this phase. When the software an organization is using cannot fulfill customer needs, feature updates are crucial. Redesigning software is the final resort but is necessary in cases where it fails to adapt to modern advancements.
This domain involves structuring an organization’s data assets and management resources. An insight into business analytics lets businesses evolve along with customer needs. Data that’s collected from users is stored in the database so that it can be managed and maintained for future reference. A strategic architecture makes processing complex data much easier.
Resources, including software and hardware, are required to implement the application services. Modern technology is essential to building a functional network. This includes devices, routers, software, and storage. Adapting to changes is the key to success, and these changes will come in the form of a dynamic marketplace and changing user behavior.
A common practice of combining data and application domains into a single information system component works well for many EA frameworks. Moreover, all of the data that’s collected from customers can take up quite a lot of space. Putting it in the cloud is the safest, most advanced way to keep things rolling seamlessly.
What role does the core foundation play in the business?
Every business has an inbuilt EA helping it achieve certain goals. In some organizations, it’s thoughtfully designed to support teams of highly skilled professionals, who get together and form strategic guidelines. Based on these guidelines, the EA is implemented. With other organizations, the EA may simply be an underlying process for designing, improving, and maintaining an IT network that goes on without proper infrastructure.
Applying innovative technologies, such as blockchain, artificial intelligence (AI), and cognitive computing seems tempting. But you can never underestimate the potential and power of rock-solid EA since it can transform an organization. In each framework, EA represents a comprehensive methodology for an organization to be visualized, described, and adopted. It is one of the ways to associate your infrastructure with a slew of proven benefits.
- Comprehensive strategy
EA can safely be considered a bridge between the business values and IT infrastructure of an organization. Providing teams with the direction for IT processing and a technical roadmap, EA is an essential strategic tool that offers the comprehensive insights that are required for effective communication across the board. EA provides the blueprint for delivering concrete products, services, processes, and other structural elements.
- Reduced complexity
The purpose of modern advancements, tools, and IT solutions is to make processes simpler. EA can be a game-changer when an organization pairs a proactive, results-oriented approach with a streamlined workflow. Businesses with data-driven core values that are striving for strategic changes are most likely to benefit from this optimal setup.
- Minimized costs
Budget allocation and accountability are the driving forces behind smoothly executed business operations. When costs are poorly managed, an EA team’s efforts can go awry in the blink of an eye, and the problems they see will just be the tip of the iceberg since worse outcomes are likely to follow. A thoughtful EA strategy can be the impetus for more efficient resource allocation, which will lead to significant savings. These benefits go beyond resource investments that have an impact on stability, profits, and the time to market. A streamlined finance structure reduces friction for EA teams and greatly increases the likelihood of achieving the desired outcomes.
- Standardization and flexibility
Every stakeholder across the technical, sales, marketing, research, and development teams must be aligned on the strategy for EA values to achieve maximum productivity. Done well, an EA initiative will ensure this. In addition to creating multiple business units that can be managed hassle-free, EA can offer better software support and guidance than ever before.
By harnessing the power of EA, an organization can strengthen and streamline its working environment by integrating services and applications.
- Robust security
EA can be the guiding force behind data protection and cybersecurity processes in general. With constantly rising security concerns across digital networks, an effective EA blueprint is crucial to mounting a robust defense against the burgeoning risks of cybersecurity threats. This doesn’t even include the additional security risks that stem from internal IT missteps, such as shadow IT and redundant applications. EA, in that area, holds the key to protection and ensuring better use of your digital assets.
- Analytical adaptability
EA empowers teams with quick reaction capabilities, adaptability to embrace modern advancements, and greater agility to adapt to sudden shifts in the industry. Nothing beats the ability to assess a situation and do away with outdated and potentially harmful practices. An organization can use these data-driven insights to improve the business model and its strategies. The perks that follow include a noticeable decrease in business risks.
These benefits of establishing a core foundation speak volumes about the usability of an EA. For an organization juggling innovation, growth, and strategy, EA can act like the glue that holds the company’s vision and operations together. That is why consultants who work with organizations on their EA development often encourage them to abandon legacy systems and establish EA as an ongoing project – success hinges on effective planning and implementation over time.
One such consulting firm, NetSol Technologies, has worked with companies to accelerate the reinvention of their applications and data for a cloud-native world. With the benefit of having experience with hundreds of engagements on EA projects, the team has found that the reality of effective IT infrastructure is being able to elegantly orchestrate interconnected elements within a multi-level organization. Complexities are often associated with unpleasant events. Simplicity and adaptability are the names of the game.
Business dynamics versus IT complexity in businesses and IT systems
Something that the thriving leaders of the digital world must consider is that such systems can be complicated to understand but not necessarily bad. On the contrary, they have proven to offer a massive turnover. In dynamic and uncertain environments, complexity confers critical benefits.
It’s time to dive deep into the business dynamics to reflect on the nature, benefits, and costs of complexity. We will offer guidance and insights into the best practices on how to manage complexity in a business organization.
What good does complexity bring?
As far as business circumstances are concerned, complexity can be defined as multiple elements, including technological infrastructure, raw materials, products, services, and other organizational units. They are interconnected and are codependent and equally prone to offering advantages and disadvantages, depending on the way they’re managed.
Some notable advantages include an increase in the resilience of the business architecture. There is no second thought about the fact that companies that adapt to modern technologies and equip their employees with industry best practices are in a better position to cater to any unforeseen unpleasant situation. Adaptability is the most natural phenomenon when dealing with human matters, including business and technology. Shuffling and reshuffling existing elements can ensure sustainable learning mechanisms. This approach has helped leading fashion retailers, such as Zara, create a tailored selection for customers and adapt to ever-evolving trends. Closely correlated and interconnected elements ensure effective coordination. Shared behavioral protocols and a similar wavelength with which their movement is enabled ensure foolproof collective security.
Above all other benefits, inimitability caused by complexity can be an unbeatable element for competitors. The challenge of replicating the interrelationship between each element requires unmatched skill. The same happened with Apple when they tried their luck with the Map application. The results were devastating and struggled to gain acceptance with consumers.
The costs of complexity
A phenomenon that offers a plethora of benefits to taking your organization to new heights is bound to cost a fortune. Creating and maintaining multiple elements is not only complex and beneficial but expensive as well, especially compared to other standard approaches that bring down a company’s productivity.
The inability to manage regular operations gets difficult with increased complexity, which is rooted in the system’s decreased understandability. Things can get hard for the leaders within an organization as they will have no clue about where and how to intervene to manage performance in case of a system glitch.
When combined, the whole situation that’s ingrained in complexity can cause extreme uncertainty. The organization works tirelessly to set up a system with responses based on predictable behavior. This is taken over by unpredictability if it’s not managed effectively and promptly. Catering to this situation of uncertainty demands high levels of reliability through strategic investment in time and resources.
Losing sight of business matters
History is loaded with examples that showcase diverse impacts of excessive complexity. At top of the list, Three Mile Island Nuclear Reactor was the result of a complex control panel. The team failed to interpret the crazy alarms and layers of notifications, resulting in catastrophic confusion. A fixable rudimentary issue of the stuck coolant draining valve turned into something horrific – courtesy of complexity.
Why complexity gets out of hand
The ever-so-evolving internet has exposed the inflexibility of many technologies and business processes. The inability to adapt to new channels comes complimentary with it. This inflexibility is rooted in complex systems, where developing and testing new capabilities is time-consuming, and every change becomes an expensive adventure. In major banks, the systems are often so complex that even the bare minimum operations result in rigidity and high expenses.
Inefficient and non-value-adding variations of complexity make it difficult for the system to maintain the culture of innovation and growth, resulting in strategic disadvantages. Implementing a standard centralized digital process may sound boring but is the right approach in many cases.
Going beyond anecdotes for dealing with quantifiable results and a larger sample led us to two major findings:
- Conventional wisdom may consider agility-borne benefits to be contradictory – that is, efficiency at the cost of employee engagement. However, our results show otherwise. Smooth and seamless agile transformations delivered 30% higher customer satisfaction, employee engagement, and operational performance, leading to a turbocharged innovation model. Organizations with a successful agile transformation are more likely to be top-quartile performers among their counterparts.
- Management and organization leaders must take charge of the operations, rather than sitting back and waiting for this to happen bottom-up. Four elements stood out in our logistic regression model when we compared around 300 highly successful transformations with the 580 less successful ones to see the difference in their course of action. The results of this analysis are the secret behind a higher success average of around 75%:
- To ensure a trickle-down impact, ensure that the team at a higher level within an organization has these concepts at their fingertips. They should be in a position to lead by example and enable change.
- Among all the efforts toward agility, do not forget to set clear organizational values and ensure that the top team follows them in a structured manner.
- There is more to an agile infrastructure than just the top team. Focus on building connective tissue among strategy, business process, people, and technical aspects.
- Slow and sturdy wins the race, but do not let the organization exhaust itself with unnecessarily extended processes. Commit by picking high-priority areas.
Significant performance improvements with agile transformations
An agile transformation sure has bundles of benefits, but does it work as well in reality as it does in a theory? With this new model, you welcome a team with a new highly motivated mindset, effective strategy, and state-of-the-art technology. The scope to take risks and investments will follow. An agile working environment where employees are an essential part of the decision-making process and have the opportunity to master their craft drives innovation.
Business agility depends on the foundation for execution
Modern business approaches, where there is a need for a hands-on strategy and extraordinary decision-making skills to enable change, have made business agility an absolute necessity. Accurate predictions are often a long shot but are quite effective when it comes to digitizing consistent business elements. Setting your eyes on constantly evolving factors ultimately makes a foundation for execution turn into a foundation for agility.
Among various types of agility, there could be multiple explanations for different outcomes from a similar agile setup. However, the takeaway is simple: a digitized foundation for execution enables managers to focus on what products would succeed and then bring those products to market within an industry.
National/political environments and business discipline
With increased revenue comes great responsibilities and accountability. Many companies with complex and unsorted financial and operational matters get stuck with legal obligations. Some organizations face complicated rules and regulations within the same country and end up having massive expenditures with no added value. On the other hand, a solid foundation for execution and transparent processes makes it easy to access data in no time. New laws and business regulations may affect a business process but with a well-structured system, data can easily be accumulated.
Building a foundation is safe and cheap
It’s time to shake off the outdated idea that making improvements is risky and can rip off your business financially. The foundation of execution can be implemented on a single ongoing project within a company. It can be a pilot project to understand how it works and how much it costs. A massive decrease in processing costs and enhanced efficiency is a done deal.
Creating business value with a foundation for execution
Knowing where to defend and where to attack can go a long way when mapping business strategies, tactics, and capabilities. However, organizations need to approach business agility in terms of the dynamics of the business strategy. EA not only enables agility but can play a major role in increasing the flexibility and viability of an organization.
Business agility is facilitated by sufficient resources that are required to react to a certain improvisation. Although the need for a balance between efficiency and flexibility helps execute the process, increased requisite variety and fewer constraints for implementing strategic change are guaranteed. There could be a manual agility process or an automated one; the main factor that sets these apart is the process’s ability to replicate the improvements in the latter. Moreover, business agility management is as crucial as the transformation itself. This new and specialized business capacity is event-driven and consistent.
EA principles for business agility
The ability of a business to react to a certain change in the industry that affects customer behavior is what agility is all about. Apart from enabling more innovation and improved value proposition, a noticeable decrease in system risks makes the business stronger from the core. However, before putting business processes on the path of agility, leaders must consider some fundamental principles of EA for business agility.
At the top of the list, we must reduce bureaucracy and constraints to avoid multiple approaches. No matter which industry we are dealing with, a system should put the customer first and keep up with their journey to make relevant up-sales. In every business structure, effective communication paired with data-driven processes enables fast decision-making, which is an essential ingredient for business agility.
The value a business agility model brings along is worth giving a shot. Not only does it offer greater freedom of choice for management but also to the teams at an individual level. With an appropriate and timely flow of information, an organization can do wonders, and that is what business agility offers – the knowledge of change followed by immediate action capabilities.
Implementing change is without a doubt an essential pillar of the business process, but being able to unlearn certain trends and legacy is equally important. Moving fast in response to customers’ needs and gaining critical advantages allows organizations to switch resources quicker and faster than their competitors.
Successful business agility management factors
- Ensure there are measurable aims for stakeholders and create a business model that is updated regularly
- Stay atop all the potential risks and equip the team to deal with dependencies, costs, return on investment, and cultural issues
- Stakeholders must be updated about the change, the reason behind it, and the cost and benefits that follow a particular implementation through effective communication
- Ensure there are training programs and skill polishing sessions across the board for personal counseling that help alleviate any change-related fears
Combined, these factors work effectively toward the success of business agility management.
What challenges may follow business agility management?
Apart from the undeniable benefits, business agility management may encounter multiple challenges that can only be catered to through proper skill development. The constant need for the adaptation of continuous advancements within the system might be exhausting for some stakeholders. With constant change follows constant risk and unpredictability. To be able to deal with such fears, uncertainty and doubts can often get a bit difficult.
Designing a business model and setting the right foundation for viable outcomes is essential for agility management. Setting realistic goals and maintaining the balance between decision-making speed and efficiency is one of the biggest challenges for highly motivated leaders. However, by continuously scanning the market trends and customer behavior, organizations are likely to grab game-changing investment opportunities.
Putting business operations on the right track in today’s digital world is essential. One of the smoothest and most seamless ways to ensure this is by adapting to modern tools and techniques that enable effective communication, as well as help the company land impactful investments and stay atop modern industry trends and customer behavior. It helps keep a balance between IT technologies and business processes.
All these elements set the right foundation when it comes to building an EA. Organizations often struggle to keep up with the ever-evolving technology, so the innovation and growth process slows down a notch. The way forward is by implementing an EA that navigates the organization through business processes for desired business outcomes. With visionary leadership, a skilled team, and a future-centric approach, along with a guide for best industry practices, an organization is in a better position to execute a seamless transmission based on EA.
This chapter focused on developing management and implementation skills within an EA while following industry best practices. Furthermore, an organization based on EA principles needs to have EA leaders that are ahead of certain elements to keep the workflow smooth and seamless. The size of the team, infrastructure model, and organizational structure are at the top of the list.
However, the thriving industry leaders of the digital world must consider the complications and challenges that come with the package. Only a well-structured and thought-through business agility model is capable of handling the constant need to adapt to continuous advancements within the system. This might be exhausting for some stakeholders because with constant change, there are constant risks and unpredictability. In the next chapter, we will evaluate the core foundation and the most efficient ways to achieve the desired outcome in our first attempt.