7 common business design and architecture models

Make more sense of your enterprise architecture practice by relating it to any of these common business design methodologies.

Business and enterprise architects are often asked to prioritize initiatives and projects. To complete this task, they need to know their organization’s strategies, goals, tactics and objectives. Too often, these can be very difficult to gather either because architects have never been aware that they existed or sometimes because they simply and plainly don’t exist.

To extrapolate these strategies and objectives, there are numerous business models that are being used for business design. The seven most common business design methodologies each relate to enterprise architecture in different ways.

1. Balanced scorecards

The balanced scorecard is a strategy performance management tool popularized in the 1990s with a semi-standard structured report, that can be used by managers to keep track of the execution of activities of their organization within their control and to monitor the consequences arising from these actions. These actions can either be financial, customer-oriented, geared toward internal business processes or about learning and growth.

This methodology is frequently used within more traditional organizations. The benefits of using this methodology are among others better alignment of projects and initiatives, improved performance reporting, and better organisational alignment. If in place, this methodology facilitates initiative and project management for architects since initiatives are elaborated for each mentioned objective. Enterprise architects can rapidly identify related value streams, capabilities and their supporting applications that need to be enhanced for each one of these initiatives.

2. Hoshin Kanri

The origin of the Hoshin Kanri methodology dates back a few centuries ago to 1645. It originates from Japan and was popularized worldwide in the 1980s and not just for the manufacturing industry. Hoshin Kanri is a 7-step process used in strategic planning in which strategic goals are communicated throughout the organization and then put into action at three levels of the organization. The 7 steps of Hoshin Kanri are 1- establish the vision and assess the current state, 2- develop breakthrough objectives, 3- define annual objectives, 4- cascade goals throughout the organization, 5- execute annual objectives, 6- have monthly reviews, and step 7- perform an annual review.

The main advantages of using this methodology include providing focus and drive towards specific and important goals of the organization; and creating a shared vision of a precise strategic plan. If in place, this methodology facilitates initiative and project management for architects by linking them to actions derived from the 3 levels of the Hoshin Kanri methodology. Again, enterprise architects can identify related value streams, capabilities and their supporting applications that need to be improved for each one of these initiatives or projects.

3. Business model canvas

A much more recent business model methodology has become extremely popular among start-ups, small and medium-sized companies. It’s called the business model canvas approach.  It is a lean strategic management template for developing new or documenting existing business models. The business model canvas is a visual chart with 9 elements describing a firm's or product's value propositions, customer segments, customer relationships, channels, key activities, key resources and assets, key partners, cost structure and revenue streams. It assists organizations in aligning their activities by illustrating potential trade-offs.

FIG1

The business model canvas is designed to guide thinking through each of the key components or building blocks for devising a business model, speed and agility, a common language and is centered toward the value proposition of a product or an organization or one of its business unit. Figure 1 above and the article entitled “Bridging business model canvas and business architecture” demonstrates how to bridge your business model canvas to your business architecture to optimize with agility the marketing and operating modeling of an organization. This bridge opens-up new customer-driven modeling.

4. Business motivation model

Many enterprise architects that execute any business architecture will usually include in their practice the business motivation model. Adopted by the Object Management Group (OMG), the business motivation model (BMM) provides a scheme and structure for developing, communicating, and managing business plans in an organized manner. The core of this methodology resides in Figure 2 below.

Here are basic definitions. A mission is a short statement of why an organization exist, and often specified more precisely with a vision statement to be achieved within a finite timeframe and made of a series of long-term goals and short-term objectives. Strategies consist of high–level plan items that also include short-term tactics to achieve an organization’s major goals under conditions of uncertainty. A goal is a desired result that an organization envisions, plans and commits to achieve within a finite timeframe. As for objectives, they are essentially short-term goals whose achievement brings an organization closer to its long-term goals. Objectives are derived from tactics, which are conceptual short-term actions to deliver and execute a strategy.

FIG2

Should its organization have either the balanced scorecards, the Hoshin Kanri business model methodologies or another type of business model in place, an enterprise architecture team should easily be able to extract the goals and objectives necessary to design the architecture of initiatives and/or projects. Understanding the strategies, goals and objectives of its organization, makes its possible for an enterprise architect to select and build the relevant value streams to be examined, the most adequate business capability measurements, and design precise business outcomes for its initiatives and projects. If goals and objectives are nowhere to be found in the organization, the enterprise architecture team will need to extract them from management. Obtaining goals and objectives would be ideal. Many enterprise architects often have to fallback on less precise strategies and tactics because of the reluctance of some managers to commit to precise goals and objectives.

5. Design thinking

As for the design thinking methodology, it relates more to products and services that are offered by an organization and it is not strictly speaking a business model methodology. It refers to the cognitive, strategic and practical 5-step process by which design concepts for new products and services are developed by designers and/or design teams. Many of the key concepts of design thinking are identified through studies, across different design domains, design cognition and design activity either in laboratories or in natural contexts.

Design Thinking has several advantages. It provides to it users the opportunity to view a problem from different perspectives. Design thinking also encourages innovative thinking and creative problem solving. It also ensures that the outcome meets the organization’s objectives and the client’s requirements.

6. Customer journey maps

Examining customer journey maps is becoming the norm within many organizations. A customer journey map is a visual representation of every experience your customers may have with you. It helps to tell the story of a customer's experience with your products, services and brand from their original engagement and into possibly a long-term relationship. Customer journey map can easily be associated to value stream and its value stages. The article entitled “Architecting and delivering optimal customer journeys” describes in detail how enterprise architects can plan to optimize customer journey maps.

The benefits of using customer journey maps are numerous. They bridge the communication gap between sales, marketing, and operations. They provide a better understanding of the customers by building a higher emotional connection with them. Finally, customer journey maps also enable the identification of holes, where initiatives need to be planned to fill them with effective touch points. Journey maps do not need to be limited to customers. They can also apply to partners, vendors, regulators, internal stakeholders, etc.

7. SWOT Analysis

SWOT analysis can be used everywhere by enterprise architects for business units, products, services, initiatives and projects. It was invented in the 1960s by Albert Humphrey. SWOT analysis is a strategic planning technique used to help an organization identify strengths, weaknesses, opportunities, and threats related to business competition or project planning.

Different business design methodologies can enhance the work of an enterprise architecture team. Enterprise architects should use whatever business or product model methodologies are in use in their organization to model their architecture artifacts. If there isn’t one, they can easily turn to the business motivation model and extract strategies and tactics from their business managers.

Copyright © 2019 IDG Communications, Inc.

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