Sunday, June 16, 2013

EA as Silo Integrator

Remember, adopting EA is a strategic move, not just a tactical activity, focus on building the type of advantage or differentiation that is required for long-term business success.

The historic root of the functional model in most organizations dates back to the 1850s, large companies could make better use of their people’s expertise and scale to build business efficiency by divided into corporate functional departments.

However, nowadays, the business environment becomes more dynamic, inter-dependent and hyper-connected than ever, the functional organization simply no longer serves companies as effectively as it once did. So, EA as chief designer, how to re-imagine organizational structure, retool functional model or bridge business silos? What will be a convincing argument for the business to move away from silos structure and promote EA?

  1. EA should ‘reboot’ culture before retool functions. Silo is more of a mindset & culture issue than the functional border. Silos are at least partly created because people in large organizations build mini-empires. Until you change that mind-set, silos will not disappear. Which is interesting, because in that context, what can EA do? If you can't remove the silos, EA can help you build a structure that will work WITH the silos. Sure that structure will be much more costly, complex and complicated than without silos 
  1. EA has to understand the business from a number of points of view. One of the most important things in terms of taking a business (specifically the board/ controlling group) with you on a long term change to the architecture & business itself is to see a company as a series of profit flows. If you can formulate an argument for changing the business in this language, then you have a far better chance of persuading the board.  
  1. EA works on update upon governance model: The value of functions is undeniable; no company could do without them. But the business and organizational models that govern functions need updating. The most important business practices and collaborations no longer fall neatly into groupings designed many decades ago. 
  1. EA's task has always been to make an organization agile and "keep it ready" for future business changes. But a second KEY purpose is perhaps to try and ensure the architecture meets present business needs as well, as the business segments have become more focus on "at the moment or very near future" results, but bureaucratic structure and functional silos more frequently stifle the innovation and create inertia to changes. 
  1. EA as capability producer to tone in enterprise’s unique capabilities, and creating meaningful differentiation requires capabilities that are almost always cross-functional. Perhaps the most obvious symptom of distress from the functional model is the widespread problem of incoherence. Most functional teams are good at many things, but great at nothing, also because functions have a natural tendency to become isolated organizational silos, focusing on their own excellence and performance instead of the company’s strategy 
  1. Parking the EA function at the right level of Influence & Authority coupled with accountability is key. ROI should be based on the cost of "confusion" and the value of "knowledge" in the enterprise. It's a complex interplay between business planning for business as usual and future change, business organization (whether in silos or not: how the business goes about implementing its strategy), and EA as a SUPPORT tool in this mix. 
  1. Each silo function is a piece of puzzle, then EA is the super glue to complete the picture and solve the puzzles.  Find a business problem that is recognized and prioritized, find one caused by silos. Then show (in simple terms) how EA helps to solve the problem. For example, showing how individual areas of expertise produce knowledge that's specific to their area, but when they're combined (graphically has an even greater impact), one gets new, synthetic knowledge that did not exist in any of the individual components.  
  1. It is critical that EA balance the strategic and tactical risks, while creating a smooth transition/ transformation. Reduced TCO and a more agile organization are the justifications for this 'merger'. It is disruptive and with that disruption, there are associated tactical risks that impact ROI. Not doing EA leaves an enterprise vulnerable to more agile competitors. Also, don’t assume that all silo businesses are unsuccessful. You can argue about how much better they would be if some of these silo behavior was changed, but that doesn't diminish the fact of their current success. 
  1. EA is an integrator of silos if it’s not the solution to eliminating business silos. Now in cases where the operating model does not align with the organization’s strategic intent, one should look at the argument for a change in business strategy or an adjustment to the operating model. Such a change would require a strong argument and business case and unwavering support at the CxO level. EA could certainly help to drive and implement and sustain such a change. 
  1. EA glues cross-functional teams. The most common solution used today is the cross-functional team. Many companies try to manage complexity by assembling committees of people from the relevant professional groups to solve particular problems. Unfortunately, many cross-functional teams also fall far short of delivering effective and efficient solutions. Permanent cross-functional teams are the other experiment. A growing number of innovation groups bring together disparate functional skills to facilitate the launch of new products or services. This approach would link the specialists of the enterprise more directly to the capabilities that directly support the company’s core strategies, lifting them to a new level of accountability. 
Remember, adopting EA is a strategic move not just a tactical activity, focus on building the type of advantage or differentiation that is required for long-term business success. EA as a function integrator to ensure the organization as a whole is superior to the sum of pieces.  Companies need to be clear about what they can do better than anyone else with such capabilities imperative and coherent capacity.


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