I’m often asked, by both business and technology stakeholders, why they should spend money on enterprise architecture when their budgets are already too tight. A common reaction to budget cuts is to drop strategic work in favour of diverting funds to operational activities. Many fail to recognise that this is the time when a clear enterprise view of the organisation is vitally important. Although a large architecture program may not be appropriate, you may have to invest some money to avoid wasting significant money on poor decisions.
The following are examples of how I have seen enterprise architecture provide tangible benefits to organisations when funding has been constricted.
Ensuring operational activities head in the right direction
Although there may not be much budget for new projects, operational activities will still need to continue to ‘keep the lights on’. Organisations have to make operational decisions every day to continue functioning as a business. But if you don’t know where you’re going, how do you know which direction to take? Only by defining the target state for an organisation can you know whether these operational decisions will take you towards or away from the business vision for the future. If you need to take a step off the road to the target state due to funding constraints, at least you will fully understand the impact of that decision and know what will be required to get back on the right path.
Using current state analysis to identify opportunities to
Analysing the current state of your enterprise architecture will often reveal areas of duplication and sub-optimal performance that could be wasting limited resources. However, it is very important to properly investigate the costs and benefits of potential consolidation opportunities to understand whether it really is the right investment for an organisation at that time. Where duplication is identified and one component is performing poorly, the use of that component can be deliberately contained until the cost of decommissioning it can be justified.
Sometimes, redundant components are discovered that are no longer being used. In a recent example, a current state assessment of an organisation’s application portfolio revealed a number of applications which the business has ceased to use but had not informed IT. Some of these applications had not been used for years but the organisation had continued to pay the licencing and maintenance fees.
Avoiding wasting money on the wrong architectural decisions
If a few projects are still in progress or have managed to secure funding, a strategic architectural view will be vital to ensure money is not wasted on incorrect architectural decisions. For example, in the absence of any architecture capability within a particular organisation, two business units had each secured funding to replace their core mainframe systems. One business unit was buying an enterprise grade case management system, the other business unit was building one! A short architecture review revealed that although each business unit managed different types of cases, both their needs could be met with a single, flexible enterprise solution. Though this is a fairly extreme example, the same architectural principles should be applied to ensure multiple projects are aligned properly to maximise the benefit to the whole organisation.
Using a cohesive, strategic view linked to business outcomes to
help get funding
Company Boards are responsible for achieving the strategic goals of an organisation and ensuring the ongoing viability of the business. They are also the ones who ultimately approve large programs of work. Enterprise architecture provides a strategic view of where an organisation is now, where it wants to be, and what it needs to do to get there. This not only provides clear linkages between the strategic goals of the organisation and the projects seeking funding, but also demonstrates how the projects work together to deliver the business outcomes. This allows Board members to very quickly understand the benefits of potential investments. As an example, one organisation had tried for over five years to get funding to make improvements to business applications but was consistently knocked back by their funding body, only receiving the bare minimum to ‘keep the lights on’. After developing a cohesive Enterprise Architecture for the organisation, the next submission linked the government approved Corporate Strategic Plan and IT Strategic Plan to the proposed Program of Work through the EA blueprint. Even though this submission was made in the wake of the global financial crisis, five years of funding for the proposed Program of Work was approved.
Enterprise architecture provides a clear understanding of how an organisation can achieve its business goals. This is very relevant when funding is constrained as it allows an organisation to make informed rather than reactionary decisions.
Originally posted as 'Why Spend Money On EA When Budgets Are Tight?' on the Enterprise Architects website.