Proposal for an Enterprise Business Architecture

Denise Bedford Information Quality Revised February 19, 2007

Purpose & Overview

Purpose of the presentation is to:  propose a framework and strategy for aligning IT to business through the development of a business architecture  Hear the Architecture Committees advice on the value and feasibility of moving in the direction of a business architecture Presentation Overview
  

Value of Business Architecture Designing a Business Architecture Business Process Management

Value of Business Architecture

Business Challenges
Business is facing:  Global business competition  Rapid innovation and fast-changing business requirements  Regulatory compliance challenges  Increasing cost pressures Technologys typical response  Slow delivery times  High maintenance costs  Brittle solutions  Stove piped functional applications  Redundant development efforts and operations  Redundant and costly investment in multiple technical solutions Can technology be realigned to support the needs of business?

Aligning IT with Business

There is little disagreement within or outside the organization that we need to align information technology to support the business We need to decide:
  

What we expect to achieve from the alignment and how will we measure it What alignment means from a business and from an IT perspective What strategy we will use to achieve the realignment

The decisions will be made at the enterprise level so there needs to be an enterprise context for the realignment The realignment needs to support decentralized development and business evolution in the future to achieve this we need a business architecture

Expected Results of Aligning IT with Business

How do we know this is not just the latest management fad?  Because it has practical applications which we can use to achieve our business goals and objectives What are we trying to accomplish by shifting the role of information technology to an enabler rather than a driver?  Define direct and derivative results of shifting our focus to a business view What is required to implement a business architecture?  Alignment takes the form of a fully elaborated Business Architecture What does it mean for how we work?  A four step plan is proposed for moving towards a business architecture involving business stewards, business analysts, technical stewards and data management team

Value of Business Architecture

Focusing on supporting the business, and casting technology in an enabler mode, will generate direct and derivative results.

Records Capture & Management Improvement Data Quality Control & Assurance Improvements Business Semantics & Sharing

Change Management

Systems Interoperability Application Reuse

Business Optimization

Process Optimization

Financial Management & Control

Business Impact Analysis

Workflow Design & Support Direct Results Role Management
Business Intelligence & Benchmarking

Derivative Results

Business & IT Alignment - Direct Results

Direct Business Results include End-to-end business process analysis and adjustment (process optimization, improvement and simplification) Alignment of resource management and analysis by business areas and with business goals (financial management and controls) Pre-impact and pre-incident detection of business events and business targets, and the ability to assess the impacts and lead times in order to mitigate the business impact (business impact analysis and business continuity)

Business & IT Alignment - Derivative Results

Derivative Business Results include.. Cross-organizational role discovery, provisioning and management based on common groups of privileges and permissions (increased effectiveness in role management and identity provisioning) More effective and targeted benchmarking with peers and enable more efficient measurement, reporting and evaluation (business metrics and intelligence) More efficient business processes based on automated workflows and business process management (workflow design and management)

Business & IT Alignment - Derivative Results

Technical Derivative Results include Smarter and rapid deployment/redeployment of new platforms and services, providing sufficient information to plan and manage the change cost effectively (change management) Interchangeable functional component design through increased access to and reuse of technical resources (applications reuse) Optimization of use of the organizations technical resources by all contributors or consumers, regardless of location (systems interoperability)

Business & IT Alignment - Derivative Results

Data and Information Derivative Effects include


More rigorous, visible and auditable records capture throughout business processes (records management) Identification and management of quality control checkpoints and improvements in data quality and trustworthiness (information quality assurance) Access to management information from a business perspective rather than an application perspective (business semantics)

Designing a Business Architecture

Designing a Business Architecture

In order to align technology with business, we need to design a business architecture Business architecture includes:  Business framework to which all business definitions and models can be mapped


Business process management best practices for representing business processes which are manageable by business analysts, understandable to business managers and executable by developers

Current State Business Framework

We dont have a comprehensive view of the Banks business at this time, although we have a wealth of business knowledge and documentation
      

Current business definitions may be constrained to what single organizational units do and how they do it May be variations on a process across the organization Formal policies and procedures may not fully describe how work is done May be gaps in coverage of some business processes May be redundant descriptions of the same process which are not consistently maintained May represent a technology view rather than a human workflow view May not describe all of the resources that are required to support a business process

Current State Business Framework

For example, there are currently several high level schemes in use throughout the Bank
    

Accounting framework (Controllers budget and expenditures) Records management framework (BRCS, Archives Fonds organizational history) IT-Business framework (application-focused) Business continuity framework (core processes and critical incident) Business definitions in administrative, policy and procedures manuals (business operations)

Each scheme represents a resource viewpoint, though none serves as a baseline for comprehensively aligning resources to end-to-end busienss processes We propose a new framework which will allow us to harmonize these views this framework takes the form of an organizational business taxonomy

Business Framework

Strategic Alignment and Aggregation

Business Areas

Lines of Business

Business Processes

Business Subprocess and Tasks

End to End Primary Business Activities

Banks Business Framework

Level 1: Business Areas  High level aggregation which distinguishes primary and support activities, and which is aligned with organizations strategy and performance goals [Example: Operations] Level 2: Lines of Business  Set of one or more linked business processes which collectively define a line of products and services [Example: Lending]  Provides a level of aggregation which is valuable for evaluation and monitoring but not sufficiently granular to enable business process management Level 3: Business Process  End-to-end description of a process which is comprised of a series of steps or tasks that have defined conditions triggering its initiation and defined outcomes/outputs at its completion [Example: Project Appraisal] Level 4: Business Subprocesses and Tasks  Individual tasks which make up a process, or a group of tasks which is enacted or called from another (initiating) process (or subprocess), and which forms part of the overall process [Example: Draft Aide Memoire]

How to Determine if it is a ..
Criteria Definition Line of Business There must be an accepted and published definition of the line of business, including all products and services There must be defined, institutionally authorized and published policies at the LoB level. The LoB must have defined products, services, outputs and outcomes which are required to sustain the organization. The LoB has a defined budget line. Business Process There must be defined conditions marking the initiation and completion, and a sequence of steps in between. There are institutionally authorized and defined business procedures, events, rules, tiggers and conditions that derive from and implement the LoB policies. The Business Process has defined inputs which are converted directly to outputs at the end of the process.

Policies & Governance Processes

Products & Services vs. Inputs & Outputs Budget vs. Expenditures

Business process incurs individual expenses which can be tied to tasks or subprocesses, for all types of resources. Inherits at least the risk rating of the LOB, but may have an elevated risk if the business process must continue regardless of other BPs in the LOB. BPs have service standards and quality metrics for individual products and services. BPs tracks to specific customers, who receive the products and services at the completion of the process.

Risks

There is a known business risk to the organization when it is not available. LoB must have defined and published service standards and quality metrics across products and services. LoB has defined consumer groups/segments and stakeholders, whether internal or external to the organization.

Service Standards & Metrics

Clients & Stakeholders

How to Determine if it is
Criteria Human Assets Line of Business LoB has associated core competencies, job family and job profiles. Supported by facilities, consume energy, use communications, data, and information to generate outputs and outcomes. Business Process Business processes have people/roles and/or agents assigned to specific steps or subprocesses. Can trace human resources used to perform the business process. Tracks to specific applications at specific points in the business flow. Uses and produces known information assets. Tracks to specific offices and technology expenses to support the people and systems used in the process. Does not have a comparable industrial sector because it is not at a sector level of categorization. Inherits this value from the Line of Business. Is comprised of steps that make up a business process. Has a defined initiation point and a defined completion point. May have business subprocesses but does not include another business process. Not applicable.

Facilities, Technology & Information Assets

Comparable Industrial Sector

Has comparable economic sector and external competitors, regardless of whether it is a primary or supporting LoB. LoB may or may not be a primary activity for the institution. Must have one or more associated business processes. Line of Business can not exist without supporting business processes. Is aligned with a Business Area as defined by the organizations strategic and performance contracts.

Known Business Processes

Business Area

Line of Business vs. Business Process

These terms are often used interchangeably in the business literature but it is important to distinguish them because


Line of business is generally one level above where we can do business process management effectively Line of business is comprised of multiple business processes each of which represents an end-to-end process

Lets consider what would happen if we tried to do business process management at the Line of Business level

Business Processes
The framework provides us with a structure for harmonizing the Banks business knowledge, but we need to look at individual business processes for the detailed business knowledge that will help us achieve our goals


The top two levels of the framework (business areas and lines of business) provide us with a strategic view of the Banks business The bottom levels of the framework (processes and subprocesses) provide the business knowledge needed to begin to design a business architecture and to support business process management

Lets focus on Business Processes and Subprocesses in order to identify the kinds of business knowledge we need to support the business

Lending Line of Business Comprised of Linked Business Processes

Business Processes
Project Identification
Prepare AIS in SAP Prepare SMO Prepare PCN, PID, ISDS PCN Review Meeting ROC and/or OC review (for projects high risks)

Project Preparation
Draft PAD PID PAD-stage ISDS Draft EA, RAP, IPDP Minutes of PCN meeting Minutes of QER

Project Appraisal
Decision mtg package Minutes, PID, ISDS SMO Notice to Borrower Draft Aide-memoire Post-appraisal letter to Borrower.

Project Negotiation

Project Approval

Lending Line of Business

Lending Line of Business

Steps & Subprocesses

Resources Allocated and Managed at these levels Process Variations are found and Improvements are made at these Levels

Application calls are Executed at this level

Project Signing

Project Effectiveness

Project Supervision

Project Completion

Project Evaluation

Line of Business level is too coarse to support process management goals and objectives

Business Process Management Best Practices

Business Process Management Best Practices

Business process management recommends that we:
 

 

Define internal best practices and guidelines to ensure that business process models are consistently developed (ARIS Framework) Develop business models for processes, and inventory, register and publish existing business models (Business Analysts & Stewards working with IQ and IS teams) Recommend standards-based modeling and execution languages to be used by developers for implementing business process models (OASIS BPEL, WSDL, XSD) Build a business architecture layer as part of enterprise architecture (SOA + BA) Establish an enterprise governance process for business process management

Business Process Models

A business process should be represented as models of end-to-end sequence of tasks or subprocesses, which describe all of the inputs, outputs and steps/activities required to execute the process ARIS framework provides us with a comprehensive view of a business process description Working within the business framework, and leveraging the ARIS business processing modeling strategy, we can both harmonize across the organization and standardize our current business knowledge

Business Process Description

Information Services Goal Information Services

Other Services

Environmental Data

Other Services

Material Input

Material Input

Financial Resources Business Process Steps & Subprocesses

Financial Resources

Initial Event

Message

Result/Event

Org Unit

Human Input/Output

Machine Resources

Computer Hardware

Software

Robust description of a business process includes all elements of the ARIS framework.

Business Framework and Business Process Management

Looking back to the value proposition, we need a level of business process description which will allow us to:
       

connect any system associated with the process identify the people who support it link financial resources acknowledge but also cross organizational boundaries identify compliance (financial, records) points identify data and information quality control points Identify common steps and subprocesses to simplify and reuse applications provide managers with the capability to monitor the process for improvement and planning purposes

Business Process

Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).

Project Identification

Project Preparation

Project Appraisal

Project Negotiation

Project Approval

Prepare AIS in SAP Prepare SMO Prepare PCN, PID, ISDS PCN Review Meeting ROC and/or OC review (for projects high risks)

Draft PAD PID PAD-stage ISDS Draft EA, RAP, IPDP Minutes of PCN meeting Minutes of QER TT prepares QER package SM Clears TL circulates TL prepares minutes of QER and SM clears and Issues minutes

Decision mtg package Minutes, PID, ISDS SMO Notice to Borrower Draft Aide-memoire Post-appraisal letter to Borrower. TT prepares package, SM and CD clear TL prepares notice to Borrower and CD issues TT prep. aide-memoire, TL signs & delivers TL prep. post-appraisal letter SM-CL-CD clear Transmittal Memo PAD,,PID, ISDS Safeguards Documents Legal Documents Minutes, Agenda SMO, Aide-memoire Notice to Borrower BTOR, Letter SAP, IRIS, Passkey, Project Portal, Lotus Notes, LAS, Travel Web W2K, Domino, Edge Server, HIS, Oracle, WebSphere, Lotus Notes, Siteminder, iPlanet, SAP, AIX, HACMP, EMC SRDF, EMC Timefinder TSM TDF, Tivoli Monitor, Telalert, Precise Luminate Time, Cost, Cap, Vol, Quality

Negotiations Package Formal Invitation to Borrower to Negotiate Minutes of Negotiation Summary of Negotiation Status of Negotiation notice TT prepares and CD, SM, LOAG2, CC clear TL prepares minutes and Lawyer, LOAG2, Leader of Borrower deleg. clear TL & Leader of Borrower delegation sign Memo, PAD, MOP Notice of Invitation Letter of Invitation Letter of Sector Policy Letter of Development Program Minutes

Final Board Package SCR & email to SECBO Regional Pre-board mtg Memo to MD Pre-board meeting Board Approval TL prepares Board pkg, SM-FO-LY-CD clear Lawyer prepares SCR & signed by RVP, LEGVP, expert appointed by CG TL prepares NB-Board Approval & lawyer clears Transmittal memo form 2337 , form 1767 Board Doc Sub. Form PAD, MOP, speech Notice to Borrower SCR Report Form 14, Form152 Speech IRIS, Passkey, Project Portal, LAS, Lotus Notes

Role & Resp

Activities

TL prep. PCN package and Sends to SM TL prepares if applicable ROC and SM clears TL prepares OC and SM, CD, RVP clear

Information

AIS, SMO, BTOR PCN, PID, ISDS Cover Memo, Note Agenda Minutes of PCN review

PAD, PID, ISDS Safeguards Documents Minutes of QER Agenda Email

SAP, IRIS, Passkey, Project Portal, Lotus Notes, Travel Web W2K, Domino, Edge Server, HIS, Oracle, WebSphere, Lotus Notes, Siteminder, iPlanet, SAP, AIX, HACMP, EMC SRDF, EMC Timefinder TSM TDF, Tivoli Monitor, Telalert, Precise Luminate Time, Cost, Capacity, Vol

App

IRIS, Passkey, Project Portal, Lotus Notes, LAS

IRIS, Passkey, Project Portal, LAS, Lotus Notes

Metric Technology

W2K, Domino, Edge Server, HIS, Oracle, WebSphere, Lotus Notes, Siteminder, iPlanet, SAP, AIX, HACMP, EMC SRDF, EMC Timefinder TSM TDF, Tivoli Monitor, Telalert, Precise Luminate Time, Cost, Cap, Vol, Quality

W2K, Domino, Edge Server, HIS, WebSphere, Oracle, SAP, Lotus Notes, Siteminder, iPlanet, Solaris, Sybase, Replication Server, WebServer, Print Archietcture. Time, Cost, Cap, Vol, Quality

W2K, Domino, Edge Server, HIS, WebSphere, Oracle, SAP, Lotus Notes, Siteminder, iPlanet, Solaris, Sybase, Replication Server, WebServer, Print Archietcture. Time, Cost, Quality

Business Process

Metrics for Lending (Reg: 58% of Bank Budget): Cost (40%), Quality (19%), Volume (16%), Capacity (13%), Satisfaction (6%), Timeliness (6%).

Project Signing

Project Effectiveness

Project Supervision

Project Completion

Project Evaluation

Notice of signing and signing ceremony Notice to Borrower signing Signed Legal Documents

Activities

Notice to Borrower Declaration of Effectiveness

Procurement process Disbursement Financial Management

Completion report identifying accomplishments, problems, lesson learned.

OED assess what works and what does not and learn from the experience.

TL sends an invitation On signing TL prepares a notice to Borrower signing and Lawyer clears TL sends signed Legal Documents to ACTCF

TL prepares a memo & letter and lawyer clears CD signs and sends Letter to Borrower

Borrower prepares specs and evaluates bids. Ps ensures procurement Disbursement Officer authorize to withdraw fund FM maintains oversight of the FM project Bid documents, Contract Bid evaluation report Minutes of bid opening Cost estimate sheet Technical &/or financial evaluation report FM Reports/Docs IRIS, Passkey, Project Portal Client Connection, LAS, Extranet, Lotus Notes W2K, Domino, Edge Server, HIS, WebSphere, Oracle, SAP, Lotus Notes, Siteminder, iPlanet, Solaris, Sybase, Replication Server, WebServer, Print Archietcture. Time, Cost, Cap, Vol, Quality

Role & Resp

Borrower submits a completion report to the Bank Board of EDs

OED staff assesses the project and sends to CD, SM, SD, TL, etc.

Information

Notice of Signing Legal Documents Notice to Borrower Email FAX

Memo Notice to Borrower-letter Email

Report that contains accomplishments, problems, lessons learned

OED evaluation report.

App

IRIS, Lotus Notes, Passkey

IRIS, Lotus Notes, Passkey

IRIS, Project Portal, Lotus Notes, Passkey

Intranet, Lotus Notes, Passkey

Metric Technology

W2K, Domino.

W2K, Domino.

W2K, Domino, Edge Server, HIS, WebSphere, Oracle, SAP, Lotus Notes, Siteminder, iPlanet

Edge Server, IHS, WebSphere, Oracle, SAP, Siteminder, iPlanet, Lotus Notes

Time

Time

Satisfaction

Quality

Metrics for Travel (Bank Wide: Over $ 200M in FY-05): Cost Effectiveness Get Best Results with available Funds

Business Process

Travel Planning

Travel Transacting

Travel Controlling

Travel Monitoring Specific Trip

Travel Monitoring Unit/VPU

Activities

Planning at Budget Level Planning Specific Trip

Before the Trip After the Trip

Pre-Trip Controls Post-Trip Controls

Monitoring Specific Trip

Monitoring Specific Unit/VPU

Role & Resp.

Budget Analysts/Officers forecast travel expenses Traveler makes Reservation and enters Trip information into the Web Travel

Traveler contacts A. Exp AM approves the trip A. Exp receives Notice and issues the ticket Traveler enters expenses TCS is sent to Manager AM approves the trip

Ex Ante Controls: verify cost assignment, explanation of exceptions, PCard Usage, etc. Ex Post Controls: trip is approved, traveler sends receipt to ACT.

Traveler can use the Web Travel System to monitor the status of trip request as well as subsequent expense reimbursement request

Budget Analysts/Officers use the SAP Cost Report or Administrative Expense Report to monitor travel expenses

Travel Authorizations Travel Advisory services and guidelines Trip Document created In travel web system Reservation itinerary with American express Online Reservation system, Travel Web, Passkey, Notes

Itinerary VISA Ticket BTOR

Travel Expense Postings Trip Document PCard Receipt

Display Trip Print/Simulate Trip My Trip Summary Report

Outstanding Trip Claims Report Travel Expense Exception Report Budget Summary Repor Operational Mission Summary Report

Information

App

Travel Web, SAP, Passkey, Notes

SAP, Travel Web, Passkey

SAP, Travel Web, Passkey

SAP, Travel Web, Passkey

Metric Technology

W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert, Edge Server, IHS, WebSphere, Lotus Notes

W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert, Edge Server, IHS, WebSphere, Lotus Notes

W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert, Edge Server, IHS, WebSphere

W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert, Edge Server, IHS, WebSphere

W2K, IIS, Oracle, MS Load Balancer, SAP R3, TSM, NetIQ, Telalert, Edge Server, IHS, WebSphere

Cost Effectiveness

Cost Effectiveness

Cost Effectiveness

Cost Effectiveness

Cost Effectiveness

Metrics for HR Management: OPE, Performance Award, Award for Excellence, Time, learning

Business Process

Recruiting & Staffing

Staff Performance

Staff Payment

Staff Benefits

Query-Imaging & Career mgt

Role & Resp

Activities

Job Information Agency Recruitment Consultant & Staff app. YP/JPA Recruitment HARP Retiree E-recruitment

Leave and Attendance TAX Computation Staff Learning/Training Parking, health services Pension Benefits Administration

OPE Performance Mgt Performance Awards Awards for Excellence

Payroll Staff Receivable Time Recording Post Allowance

HR Query HR Imaging HR Kiosk Internal Communications

HR officer prepares

Staff prepares

Staff prepares OPE, Manager approves Manager prepares and approves performance awards, awards for excellence

Staff prepares

Staff

Information

HR Forms

HR Forms

HR Forms

HR Forms

HR Forms

Job World CATS YP System, JPA FARP Retiree System eRecruit

LARS, TAX Kiosk LMS, Parking System HR Ben Pension, Passkey NextGen Healthcare IS PeopleSoft, Solaris, WebSphere, IHS, Oracle, SAP, Edge Server, AIX, Oracle, W2K, oracle report Server, ASP, Web OPE, Perf. Award, A for Exc

OPE Performance Awards system Awards for Excellence system

Payroll System Staff Receivable Syst TRS Post Allowance Syst

Yournet HR Query HR Imaging HR Kiosk

Metric Technology

App

W2K, Domino, W2K, IIS5, ASP, Oracle, Edge Server

W2K, Domino, PeopleSoft, ASP, Oracle, Power Builder

PeopleSoft, Solaris, WebSphere, IHS, Oracle, SAP, Edge Server, AIX, Oracle

W2K, Domino, W2K, IIS5, ASP, Oracle, Edge Server

Time

Time

Time

learning

Current State Business Process Models

Current status of business process modeling..
  

Business process models exist for some business processes but they are represented at varying levels of detail, quality and focus In other cases, business processes are described as documentation (business procedures, administrative manuals, operational procedures, etc.) For some processes, there are neither models nor procedural documentation

Recommend that as business analysts work with clients, they conduct a systematic inventory of business process models to
  

Identify what exists and what is needed to harmonize it Identify gaps in existing processes Determine what is needed to fill the gaps

Business Process Model Registry

Design an enterprise level repository for business process models consistent with enterprise architecture best practices Establish a registration and review process for all business process models which is consistent with the Business Architecture governance model Empower business analysts to:  Discover and inventory existing business process models  Identify redundant models  Identify variations in practice  Identify and link models that describe steps or subprocesses in the same business process  Identify business processes which are not described by BP models

Standards-Based Modeling and Execution Languages

Business architecture is implemented in degrees it is possible to achieve a level of interoperability without having a fully deployed SOA if consistent business semantics are used across applications However a fully developed business architecture presumes a cross application, business-oriented service oriented architecture which is grounded in standards Although the standards are not yet widely adopted, some major application vendors are supporting OASIS:  BPEL for defining process flows  WSDL for defining the interfaces to services used by the process  XSD for defining the XML data structures used by the process

Establish Business Architecture Governance Model

Because the business architecture has such high value to the organization, it needs to be managed at the enterprise level Because the business architecture is cross-organizational and cross-applications, roles and responsibilities associated with building and sustaining it need to be clearly defined and supported We have proposed a governance and stewardship model which identifies and describes four roles and responsibilities, including:
   

Business stewards at all three levels of the framework (Business Area, Business Lines, Business Processes) Information Quality/Data Management Program Business Analysts Technical Custodians

Governance & Stewardship