Simplification and Enterprise Architecture

Enterprise architecture seeks to simplify organizational complexity through both business processes reengineering and technology enablement. Technology itself is simplified through standardization, consolidation, interoperability, integration, modernization, and component reuse.

Harvard Business Review, December 2007, reports on simplifying the enterprise.

“Large organizations are by nature complex, but over the years circumstances have conspired to add layer upon layer of complexity to how businesses are structured and managed. Well-intentioned responses to new business challenges—globalization, emerging technologies, and regulations…--have left us with companies that are increasingly ungovernable, unwieldy, and underperforming. In many more energy is devoted to navigating the labyrinth than to achieving results.”

Having worked for a few large organizations myself, I can “feel the pain.” Getting up to 8 levels of signature approval on routine management matters is just one such pain point.

What causes complexity?

“Complexity is the cumulative byproduct or organizational changes, big and small that over the years weave complications (often invisibly) into the ways that work is done.”

What is sort of comical here is that the many change management and quality processes that are put in place or attempted may actually do more harm than good, by making changes at the fringes—rather than true simplification and process reengineering at the core of the enterprise.

Here is a checklist for cutting complexity out of your organization:

• “Make simplification a goal, not a virtue—include simplicity…[in] the organization’s strategy; set targets for reducing complexity; create performance incentives that reward simplicity.
• Simplify organizational structure—reduce levels and layers…consolidate similar functions.
• Prune and simplify products and services—employ product portfolio strategy; eliminate, phase out, or sell low-value products; counter feature creep.
• Discipline business and governance processes—create well-defined decision structures (councils and committees); streamline operating processes (planning, budgeting, and so on).
• Simplify personal patterns—counter communication overload; manage meeting time; facilitate collaboration across organizational boundaries.”

Leading enterprise architecture and IT governance for a number of enterprises has shown me that these initiatives must be focused on the end-user and on simplifying process and improving results, rather than creating more unnecessary complexity. The chief architect needs to carefully balance the need for meaningful planning, helpful reviews, and solid documentation and an information repository with simplifying, streamlining, consolidating, reengineering, and facilitating an agile, nimble, and innovative culture.

Simplification and Enterprise Architecture

“Tear Down Those Silos!” and Enterprise Architecture

One of enterprise architecture’s “targets” is to transform the organization from being purely monolithic, functional-based silos (like operations, sales, marketing, finance, HR, legal, IT and so on) to an interoperable, cost-effective, mission and results-driven enterprise.

Matejka and Murphy in the book, Making Change Happen, clearly states that a “barrier to the successful implementation of any change is the division of the organization into silos. The grouping of the same or similar tasks (creating pockets of specialized knowledge) provides distinct opportunities for the disruption of the seamless implementation of new strategic initiatives.”

The authors ask “what is a silo and why does the term have such a negative connotation these days?

They then consult that Random House Dictionary for definitions of silo, as follows:

“A silo is ‘a tall, cylindrical structure in which grain is stored’ or ‘a sunken shelter for storing and launching missiles.’ Hmm. Very interesting. So a silo is a valuable protector of precious materials, but a single –purpose, single-use, fragmented, isolated, fairly impenetrable piece of organizational architecture.”

What makes organizational silos the enemy of change and transformation?

• “Professional jargon
• Professional memberships
• Turf and resource protection
• Comfort zones…Discrimination”

“In a specialized professional department, is the employee’s real allegiance to the company or to the profession? The answer might surprise you. Many managers we have worked with would privately state that it is the profession.” This is why in functional- based siloed organizations, they cannot achieve the unity, integration, and synergy to make successful change happen."

To break down the silos and implement true “enterprise” architecture, you don’t need to get rid of the functions (since they serve a purpose and are important), you just need to use cross-functional teams, reward cross-functional performance and strategic thinking, broaden the perspective of functional silos by providing cross functional training and development.

“Tear Down Those Silos!” and Enterprise Architecture

Contingency Theory and Enterprise Architecture

User-centric EA seeks to develop an organization both through integration and differentiation.

In Lawrence and Lorsch's groundbreaking work "Organization and Environment," the authors explore the implications of integration and differentiation in the enterprise.

• Integration is the "state of collaboration that exists among departments that are required to achieve unity of effort."
• Differentiation is when different departments have different structures and orientations (such as short-term versus long-term outlooks or relationship versus task foci).

Both integration and differentiation can be useful in different environments. For example, in stable environments an integrated organization tends to function best, while in an uncertain or turbulent environment, an organization that is differentiated internally has greater prospects for success. A key finding of Lawrence and Lorsch’s research was that the most successful organizations simultaneously achieved high levels of both.

Contingency theory states that there is not one best way for an organization in terms of structure or leadership style. Rather, according to contingency theory, it is best to vary the organizational structure and management style depending on the environment in which the enterprise operates.

EA should plan for organizations in various environments. No one plan can be successful in every type of environment. Therefore, EA should use contingency theory to develop options or alternate paths for an organization to take depending on the landscape it finds itself in. Refining the degree of differentiation and integration of departments in the enterprise is one way to navigate in different operational environments. Centralizing or decentralizing decision making, situational leadership, and altering task versus people orientation are just some of the other factors that can be varied to adjust to changing environments. The key is to keep the options open, to be nimble and agile with planning, so that the enterprise is not hamstrung by ill-conceived plans that were developed for a future state that may not exist.

Contingency Theory and Enterprise Architecture

Microsoft and Enterprise Architecture

Microsoft—with 79,000 employees in 102 countries and global annual revenue of $51.12 billion as of 2007—is the company every consumer loves and hates.

On one hand, Microsoft’s products have transformed the way we use the computer (yeah, I know Apple got there first, but it’s the Microsoft products that we actually use day-to-day). Everything from the Microsoft operating system, office suite, web browser, media player, and so on has made computers understandable, and useable by millions, if not billions of people around the world. The positive impact (excluding the security flaws and pricing) has drastically made our lives better!

On the other hand, Microsoft is a “near-monopoly” with estimated 90%+ market share for Office and Windows O/S. Near-monopolies, like Microsoft are feared to stifle competition, reduce innovation and consumer choice, and drive up prices.

Microsoft has been convicted by the European Commission of having “improperly bundled a media player with its Windows operating system and denied competitors information needed to make their computers work with Microsoft software…fines and penalties could reach…$2.77 billion. “EU officials praised the decision…for protecting consumers.” While “Microsoft backers said, the ruling will stifle innovation by making it tougher to design products with new features.” Additionally, “the EU is reviewing complaints about Microsoft’s Office Software and concerns over how Microsoft bundled encryption and other features in its new Vista operating system.” (Wall Street Journal, 18 September 2007)

From a User-centric EA perspective, there is a similar love-hate relationship with Microsoft. As architects, we believe and preach standardization, consolidation, interoperability, and integration—all things that Microsoft’s array of products help us achieve ‘relatively’ easily (imagine, if instead of an integrated Office Suite, as well as mail, calendar, task list, and underlying operating system, we had to use an array of non-integrated products-yikes!). However, also as architects, we look to be able acquire innovative technology solutions for our organizations that will help us achieve superior mission performance, and to acquire products at prices that produce the best value for the enterprise—to achieve that we need a marketplace based on healthy competition that drives innovation and price competition.

So we love and need Microsoft, but we fear and loathe the ramifications of such market dominance.

Microsoft and Enterprise Architecture