It allows for a high conceptual level sketch of business models
and the ability to model their impact horizontally across the
organization. In addition, the visual approach allows teams to
rapidly iterate several scenarios before focusing the business
model strategy on a given configuration.
Business Architecture
While also enterprise-wide in scope, Business Architecture
approaches analyze the impact of change cross-functionally.
However, they typically provide an additional level of granularity
from the high-level business models mentioned previously.
Alignment with transformation/modernization initiatives are at the
core of Business Architecture methods. The Business Architect is
the realist that makes the change happen. It is with the business
architecture, that an organization ensures alignment with
strategy and business operations. Often, it is used in the context
of Enterprise Architecture to derive the impact of strategy on
enterprise IT capabilities.
Business and Enterprise Architecture approaches to mapping
change are being used in public sector to meet the requirements of
the Affordable Care Act from the Obama Administration as well as
in Canada for modernization efforts in the federal government. In
the private sector, business architecture is being used to implement
change and transformation in insurance, banking and other
sectors.
Business Capability and Target Operating Models
Business models and target operating models are sometimes used
interchangeably. However, while business models tend to focus
on how organizations create, deliver and capture value – target
operating models provide a high level design of the organization’s
future operating model.
Business capability and target operating models typically define
views of the organization’s processes, organizational structure,
capability and IT support. The goal is to strategically optimize
operations and service delivery. One way to understand it is that
target operating models help organizations understand how the
operational processes create value.
As such, target operating models are closely aligned with strategy,
business architecture and change management programs. They
can also often relate to strategic capability models, metrics/key
performance indicators (KPIs) and sector benchmarks.
The tag words for this type of transformation tools are – optimization
and efficiency. Sectors with stagnant growth potential like banking and
government will find these tools very useful for adapting to the ‘new
normal’ of this economy.
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“
However, while
business models
tend to focus on how
organizations create,
deliver and capture
value – target operating
models provide a high
level design of the
organization’s future
operating model.
Key roles of Business Architecture
• Identification of business
transformation opportunities
• Alignment and integration of
extended enterprise value
chain
• Clarification of enterprise roles
and responsibilities
• Specification of business model
design for re-engineering and
automation