There is a simple rule in direction finding: to get to where you want to go, you need to know where you are.
Many companies undertake transformation of their IT systems without knowing where they are; without an accurate picture of their current systems and applications.
In any large organization, the IT infrastructure becomes increasingly complex over time. Often, it has grown up haphazardly with no overall strategy. Mergers and acquisitions may have introduced legacy systems that have never been removed. Applications proliferate and overlap. So when trying to move forward, many large organizations find that IT is a limiting factor.
But it shouldn’t be that way.
IT is a powerful enabler. When IT does its job properly, it drives organizations forward helping them to solve problems, service customers and manage supply chains. But the more complex the systems, the more difficult it is for IT executives to be in control, to address the fundamental challenge of knowing where they are.
As Susan Green, Global Head of Business Enterprise Architecture at Bank of America, puts it: “It’s vital to know what we have, if we want to manage our business and technology from application portfolio management through to strategy definition and capability alignment.”
Good decisions require good data
When it comes to IT planning, the quality of your decision making can only be as good as the quality of your data. Without accurate, real time insight into your current IT systems and applications, it is impossible to answer the vital questions that IT executives and Enterprise Architects face every day:
• What applications should be retired because the cost of maintaining them has surpassed the cost of the initial investment?
• What information systems will be impacted when an obsolete technology is replaced?
• What business processes will be impacted when applications are consolidated as part of a merger?
It sounds obvious to have accurate always up-to-date data, but the reality is different. Where business functions are supported with zero latent information, the insight in IT assets is often out-of-date. The challenge of decisions like these ones is multi-layered. There is the complexity of the underlying data relationships. There is the accuracy of the data that is being used to make the decisions. And there is the challenge of getting the “right information” as opposed to the “best information available”.
There is a widely-held view in Enterprise Architecture and beyond, that data can never be completely accurate nor real-time. The assumption is that it is impossible because “we work in a very complex environment” or “we are a decentralized organization” or even “we have tried it before and it didn’t work.”
But it is possible to achieve.
The key to ensuring an accurate, real-time picture of IT systems lies in the way that an enterprise operates. It is not just a question of gathering data, it is about implementing systems and processes that ensure transparency. There are three critical elements:
• Clear and defined ownership of data – it must be absolutely clear who owns information within an organization so that there is one address to find that information.
• Clear and defined processes – there must be a recognised process for updating any data – covering who, how, when and where – so that information is always current.
• Technology that enables real-time collaboration – real-time collaboration is essential to delivering an instant picture of the current state of IT systems.
Many contribute some.
In addition it is important to address the challenge of always up-to-date date with many people in an organization. Having the expectation that a couple of experts can ensure data quality is a myth. Many people should contribute some critical pieces of information on an ongoing basis rather than having a couple of experts collecting all the artefacts year round.
Isn’t it simply better to have a risk manager adding risk components, the application owner adding the application artefacts, and the finance IT controller the financials aspects?
BP’s ‘Bill of IT’
One company that has successfully tackled the challenge of getting accurate, real-time data on its IT systems is BP.
BP has grown enormously over the last 30 years and its IT landscape was chaotic and opaque. It needed to simplify its systems and cut costs, but did not know where to start. “Our technology spend wasn’t aligned to a multi-year road map. It wasn’t strategic,” says Andrew Weir, BP’s Head of Enterprise Architecture.
His team took as its model a ‘Bill of Materials’ in manufacturing – a comprehensive list of all the materials needed to create a product and how they fit together. The team created a ‘Bill of IT’ for each of the company’s business units, which showed the complex inter-relationships and dependencies between the components of the IT infrastructure. “What was important to us was establishing a good baseline figure. What are all the applications? What business processes do they support? We were rigorous in completing that, so we had that baseline.”
Once the current state was established, his team worked with the business units to define the future ‘Bill of IT’ – what kind of IT landscape that would best suit the business needs. They then created a strategic roadmap of how to get there.
planningIT was the central repository for data, collecting, collating and updating information from across the organization on application-to-business-process relationships, target architecture and roadmaps. Among the benefits, the company can now, for example, quickly and easily calculate costs and deliver obsolescence reports. It has embarked upon a program of modernization from a strong position of awareness of which business-critical applications depend on which systems, and has prioritized appropriately.
Already in the first year, BP has reduced the number of its applications by 7% and delivered $13 million in cost savings through rationalization. Even more impressively, 85% of its $1 billion annual IT spend is now aligned to strategic goals.
A common language for IT and business
BP’s example illustrates another critical point. It shows how setting up the processes to collect accurate real time data helps to bring IT and the business closer together.
As Andrew Weir puts it, “The Bill of IT gives us a common language to talk to the business. It’s something they understand and they appreciate. It really resonates.”
Even when business goals are clear, they are rarely expressed in the same language as IT architecture problems. A business goal may be easy to define such as ‘improving customer service’ but how does this relate to IT? A transparent view of the IT landscape gives you the answer to the question.
Deutsche Telekom employed alfabet’s planningIT to gain clarity into its complex web of systems spanning 15 countries. Using the accurate, real-time data it gave, Deutsche Telekom drew up ‘heat maps’ showing how applications mapped to business services which in turn identified hotspots – where applications’ functions overlapped – and potential gaps. Deutsche Telekom was then able to select retirement candidates from its applications with confidence.
By 2014, Deutsche Telekom expects to reduce its total number of applications from 4,000 to 3,000, over the entire European business, and the resulting organization will be far more able to respond to industry trends and customer needs.
Summarizing the critical importance of having accurate, real-time data on the company’s IT landscape, Dr. Karsten Schweichhart, Vice President of Corporate Enterprise Architecture says: “We cannot develop a sustainable target architecture if we don’t know where we are.”
Conclusion
Thanks to strategic thinkers such as these at Bank of America, BP and Deutsche Telekom, the issue of Enterprise Architecture is moving up the business agenda. Companies are realizing the potential that the discipline has to transform their business. Good data and clear insight enable an organization to align its IT systems, applications and infrastructure to its business strategy, deal with unpredictable challenges and anticipate future demands. As a result, enterprises can make significant savings in operating costs which can be re-invested to speed transformation.
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