Lecture 3 & 4 - Components of Enterprise Architecture

Components of Enterprise Architecture CIS3000 - Information Systems Architecture and Infrastructure Objectives 1.3 Discuss the linkages amongst the components of an enterprise architecture 1.4 Create measurable strategic objectives for a business 1.5 Create the Information Sy...

Components of Enterprise Architecture CIS3000 - Information Systems Architecture and Infrastructure Objectives 1.3 Discuss the linkages amongst the components of an enterprise architecture 1.4 Create measurable strategic objectives for a business 1.5 Create the Information System Architecture (ISA) component of an EA 1.6 Propose application requirements as an artefact of the Application Architecture 1.7 Propose the elements of the technology/infrastructure architecture for an enterprise Outline Business Strategic Objectives Components of EA Mission/Vision Business Architecture Statement of strategic direction Information System Architecture Summary SWOT analysis ○ Data Architecture ○ Application Architecture TOWS analysis Technology/Infrastructure General competitive strategy Architecture Strategic goals Security Architecture Strategic initiatives Balanced Scorecard Business Strategic Objectives Strategy “A strategy is a coordinated set of actions to fulfil objectives, purposes, and goals. The essence of strategy is setting limits on what the business will seek to accomplish” Pearlson & Saunders (2009) “Strategy is a broad formula for how business is going to compete, what its goals should be and what policies will be to carry out those goals. The essence of formulating competitive strategy is relating a company to its environment” Porter (1997) What does EA have to do with Business Strategy??? Importance of strategic use of resources in the private, public and non-profit sectors Enterprise-wide solutions required rather than individual systems and programmes if we are to get the most of our investment in human resources, technology Environment grows more complex “EA is holistic and serves as an umbrella for all other management and technology best practices” Strategic Plan Artefacts Mission/Vision Statement of strategic direction Summary SWOT analysis TOWS analysis General competitive strategy Strategic goals Strategic initiatives Balanced Scorecard Vision A vision statement describes what a company desires to achieve in the long-run, generally in a time frame of five to ten years, or sometimes even longer. It depicts a vision of what the company will look like in the future and sets a defined direction for the planning and execution of corporate-level strategies. Mission A mission statement defines what line of business a company is in, and why it exists or what purpose it serves. Every company should have a precise statement of purpose that gets people excited about what the company does and motivates them to become part of the organization. A mission statement should also define the company’s corporate strategy and is generally a couple of sentences in length. Sample Mission/Vision Statements Strategic Direction Statement “Strategic direction” refers to the actions you are taking to achieve the goals of your organizational strategy. Your strategic direction includes the plans and actions you have put in place to work toward this vision of the future for your company. The strategy statement of a firm sets the firm’s long-term strategic direction and broad policy directions. It gives the firm a clear sense of direction and a blueprint for the firm’s activities for the upcoming years. SWOT Analysis SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and so a SWOT analysis is a technique for assessing these four aspects of your business. SWOT Analysis is a tool that can help you to analyze what your company does best right now, and to devise a successful strategy for the future. SWOT can also uncover areas of the business that are holding you back, or that your competitors could exploit if you don't protect yourself. A SWOT analysis examines both internal and external factors – that is, what's going on inside and outside your organization. TOWS Analysis TOWS Analysis is a variant of the classic business tool, SWOT Analysis. Strengths and Opportunities (SO) – How can you use your strengths to take advantage of these opportunities? Strengths and Threats (ST) – How can you take advantage of your strengths to avoid real and potential threats? Weaknesses and Opportunities (WO) – How can you use your opportunities to overcome the weaknesses you are experiencing? Weaknesses and Threats (WT) – How can you minimize your weaknesses and avoid threats?  Competitive Strategy Competitive Strategy is defined as the long term plan of a particular company in order to gain (sustain) competitive advantage over its competitors in the industry. Cost Leadership Differentiation Focus ○ Cost Focus ○ Differentiation Focus https://www.mindtools.com/pages/article/newSTR_82.htm Cost Leadership 1. Cost Leadership Definition: Cost Leadership is a strategy aimed at becoming the lowest-cost producer in the industry while maintaining acceptable quality. By minimizing costs across the supply chain, production, and distribution, a company can offer lower prices to customers or achieve higher margins at the same price as competitors.\ How It Works: Companies achieve cost leadership by optimizing operations, leveraging economies of scale, implementing efficient production techniques, and controlling overhead costs. This approach often involves high efficiency, bulk purchasing, and process innovation. Examples: Walmart, which uses its scale and logistical capabilities to offer low prices, and Ryanair, a low-cost airline that minimizes operating costs to offer cheaper fares. 2. Differentiation Definition: Differentiation strategy involves offering products or services that are perceived as unique or superior in the market, allowing the company to charge a premium price. The focus is on innovation, quality, brand reputation, customer service, and features that set the product apart from competitors. How It Works: Companies pursuing differentiation invest in research and development, design, branding, and marketing to create distinct offerings. They focus on attributes such as product quality, technology, customer experience, and design. Examples: Apple, known for its innovative products and strong brand loyalty, and Tesla, which differentiates through cutting- edge electric vehicle technology and a premium customer experience. 3. Focus Strategy Focus Strategy is one of the main types of competitive strategies identified by Michael Porter, which targets a specific market segment rather than a broad market. The focus strategy aims to serve the unique needs of a particular group of customers, a specific geographic area, or a niche market segment. It is divided into two sub-strategies: Cost Focus and Differentiation Focus. 3. Focus Strategy A. Cost Focus Definition: Cost Focus involves targeting a specific market niche while aiming to be the lowest-cost provider within that niche. Unlike the broader Cost Leadership strategy, which aims at the entire market, Cost Focus targets a narrower audience, concentrating on efficiency and cost reduction within the specific market segment. How It Works: Companies employing a Cost Focus strategy aim to deliver low-cost products or services tailored to the needs of a particular segment. This often involves limiting the variety of products, reducing features to lower costs, or leveraging specialized production techniques that cater specifically to the target market. Strategic goals Strategic goals are the specific financial and non-financial objectives and results a company aims to achieve over a specific period of time, usually the next three to five years. Accomplish competitive strategy Do those things whose achievement will ensure survival and attain success. Success as defined in outcome measures Convert Mission/Vision into action Examples: Grow number of clients by 5% per year Achieve customer loyalty scores of 85% or higher “What gets measured gets managed" - Peter Drucker Strategic Initiatives Strategic initiatives are the means through which an organization translates its goals and visions into practice. Ongoing programs Specific projects Goal - Improved marketing and sales information Initiatives: Begin sales data mart within 6 months Consolidate marketing system within 5 years  Strategic Level Artefacts Mission Statement Vision Statement Strategic Plan Strategic Goal #1 Intended Outcome (s) Initiative 1-1 IT Component Performance Measures(s) Initiative 1-2 IT Component Performance Measures(s) Initiative 1-3 IT Component Performance Measures(s) Strategic Goal #2 Intended Outcome (s) Initiative 2-1 IT Component Performance Measures(s) Initiative 2-2 IT Component Performance Measures(s) Initiative 2-3 IT Component Performance Measures(s) IT Implementation and Support Strategy An Introduction to Enterprise Architecture Third Edition  Strategic Level Artefacts Strategic Goal #1 An Employee Friendly Factory Intended Outcome (s) Improve the factory safety environment by reducing injuries by 5% within one year Initiative 1-1 IT Component Performance Measures(s) Initiative 1-2 – Begin Safety inspection reporting Increase the number of a new safety application safety inspections by inspection regime in 10% 6 months Initiative 1-3 – Accident reporting System Require accident Implement accident completion within 24 reporting in 3 months hours Strategic Goal #2 Intended Outcome (s) Initiative 2-1 IT Component Performance Measures(s) Initiative 2-2 IT Component Performance Measures(s) Balanced Scorecard The balanced scorecard (BSC) is a strategic planning and management system. Organizations use BSCs to: Communicate what they are trying to accomplish Align the day-to-day work that everyone is doing with strategy Prioritize projects, products, and services Measure and monitor progress towards strategic targets The balanced scorecard includes financial measures that tell the results of actions already taken. And it complements the financial measures with operational measures on customer satisfaction, internal processes, and the organization’s innovation and improvement activities—operational measures that are the drivers of future financial performance. Components of EA Components of EA Business Architecture Information System Architecture ○ Data Architecture ○ Application Architecture ○ Technology/Infrastructure Architecture Security Architecture Business Architecture Business Architecture Business Architecture organizes information to deal with a variety of business tasks and processes (end‐to‐end value delivery, capabilities, organizational structure, and information), as well as the relationships with these businesses. Business Architecture acts as a bridge between the enterprise business model and strategy, and the business functions of the enterprise. It should primarily focus on business motivations, operations, and analysis frameworks. Business architecture should be seamlessly integrated with Enterprise Architecture efforts within the organization. Business Architecture Business goals and objectives — for the enterprise and each organizational unit Organization structure — identifying business locations and relating them to organizational units Business functions — a detailed, recursive step involving successive decomposition of major functional areas into sub-functions Business services — the services that the enterprise and each enterprise unit provides to its customers, both internally and externally Business processes, including measures and deliverables Business Architecture Business roles, including development and modification of skills requirements Business data model Correlation of organization and functions — relate business functions to organizational units in the form of a matrix report Views corresponding to the selected viewpoints addressing key stakeholder concerns Business Architecture Discuss in your tutorial According to Randy Heffner, VP and Principal Analyst at Forrester Research: “Simply positioning business architecture as a layer on top of existing EA domains is a mistake. Traditionally many organizations have pursued EA as Enterprise Technical Architecture (ETA). ETA is technology-centered. Business architecture is business-centered. Simply layering it on top of ETA will result in tech-centered silo implementation.” Information System Architecture Information System Architecture Information System Architecture (ISA) refers to the business processes and policies, system structure, technical structure and product technologies required for a business or an information system. The architecture comprises a detailed description of design, contents, list of current hardware, software and networking capabilities of the computerised system. This architecture include both the hardware and software used to provide solution to the customer. Information Architecture Content: content objectives, document and data types, volume, existing structure, governance and ownership Context: business goals, funding, politics, culture, technology, resources, constraints Users: audience, tasks, needs, information-seeking behavior, experience Applications Architecture This describes the performance and behavior of applications being used by an organization, with a focus on how the apps interact with one another and with users. This architecture is concerned with the data being consumed and produced by the applications. The Applications Architecture is specified on the basis of business and functional requirements. This involves defining the interaction between application packages, databases, and middleware systems in terms of functional coverage. This helps identify any integration problems or gaps in functional coverage. A migration plan can then be drawn up for systems that are at the end of the software life cycle or have inherent technological risks. Applications Architecture tries to ensure the suite of applications being used by an organization to create the composite architecture is scalable, reliable, available, and manageable. Technology/Infrastructure Architecture Technology Architecture Technical Architecture (TA) is a form of IT architecture that is used to design computer systems. It involves the development of a technical blueprint with regard to the arrangement, interaction, and interdependence of all elements so that system-relevant requirements are met. The technology architecture underpins the other architectures, providing a description of the logical, physical and virtual infrastructure that supports the execution of application services, which in turn support information and business functions and services. Security Architecture Security Architecture The generally accepted areas of concern for the security architect are: Authentication: The substantiation of the identity of a person or entity related to the enterprise or system in some way. Authorization: The definition and enforcement of permitted capabilities for a person or entity whose identity has been established. Audit: The ability to provide forensic data attesting that the systems have been used in accordance with stated security policies. Assurance: The ability to test and prove that the enterprise architecture has the security attributes required to uphold the stated security policies. Availability: The ability of the enterprise to function without service interruption or depletion despite abnormal or malicious events. Asset Protection: The protection of information assets from loss or unintended disclosure, and resources from unauthorized and unintended use. Administration: The ability to add and change security policies, add or change how policies are implemented in the enterprise, and add or change the persons or entities related to the systems. Risk Management: The organization's attitude and tolerance for risk. (This risk management is different from the special definition found in financial markets and insurance institutions that have formal risk management departments.) Typical security architecture artifacts would include: Business rules regarding handling of data/information assets Written and published security policy Codified data/information asset ownership and custody Risk analysis documentation Data classification policy documentation EA Components Linkages References https://www.dataversity.net/what-enterprise-architecture-does-for-organizations/ https://www.toppers4u.com/2020/11/information-system-architecture-isa.html https://www.leanix.net/en/wiki/ea/technical-architecture https://sparxsystems.com/enterprise_architect_user_guide/15.2/guidebooks/ea_technology_architecture.html https://corporatefinanceinstitute.com/resources/knowledge/strategy/vision-statement/ https://advisera.com/9001academy/blog/2017/03/07/aligning-quality-objectives-of-the-qms-with-the-strategic-direction-of-th e-company/ https://www.mindtools.com/pages/article/newSTR_89.htm https://balancedscorecard.org/bsc-basics-overview/ https://www.isaca.org/resources/isaca-journal/issues/2017/volume-4/enterprise-security-architecturea-top-down-approach https://pubs.opengroup.org/architecture/togaf91-doc/arch/chap21.html