easm. a brief overview

Enterprise Architecture System Methodology(EASM)

A Brief Overview

Eugene I. Khudobin,CEO of «Center for Effective Organizations» Ltd.

CENTER FOREFFECTIVEORGANIZATIONS

What is EASM?


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Core Concept

Enterprise Architecture System Methodology (EASM) is the comprehensive methodology intended for an enterprise transformation while facing the organizational, economical, technological or sociocultural challenges, especially in unsustainable internal and external environment conditions.

Based on general systems theory and purposeful systems management approach, EASM delivers the method for effective enterprise transformation in terms of its architecture. EASM consider the enterprise as a purposeful social system which exists according to the common system consistent patterns and reflects the system features which is common for all the kinds of systems (biological, technical, social, economical systems etc.).

Every system has an architecture. EASM represents the assertion that every enterprise – as a system – has an architecture regardless of the presence of architecture management function, and this architecture needs to be managed in order to gain a strategic advantage.

Consider EA as a principal multi-dimensional constitution of the whole enterprise structured in accordance to key stakeholders viewpoints, EASM is about to manage all the aspects of the EA in context of its integration and contribution to overall business performance maximization.

The methodology delivers interdisciplinary and interbranch common language for every kind of key enterprise stakeholders based on the common approach for grasping the consistent patterns and principles driving the existence of enterprise as a system.

Using motivational aspect of the value as an entry point for any kind of strategy development, EASM ensures the fundamental health of the enterprise secured by the harmonization of its principles and objectives with various individual stakeholder values.

Using corporate performance management as a crucial EA evaluation process, EASM ensures economical effectiveness and efficiency of key architecture-related management decisions in terms of shareholder value maximization.

Application, Support and Development

EASM is currently one of the fastest growing EA system frameworks namely in the field of the overall EA management including business strategy, values, products and services, projects and initiatives, finance, operations, structures, information, infrastructure and technology areas.

Applied in many major oil & gas, nuclear energy, telecom, engineering and professional services companies, EASM continues to develop by the relevant community of leading industry-specific and management experts based on the platform of Center for Effective Organizations Ltd.

The latest available version of the methodology is EASM 4.0 (July 2014).

Enterprise Architecture System Methodology (EASM)

EASM Overview


ARM(Architecture Reference Model)

ACMP(Architecture Change Management Process)

Enterprise-as-System Core Principles

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AAMI(Architecture Assessment

and Modelling Instruments)

Decision Making Process(Strategy Development and Implementation)

design-by-learning unified process for any type of architecture-related change management

learning-by-design

1. EASM is always about decision making. Because of its transformation purpose, EASM delivers the comprehensive toolkit for whose who engaged in preparation, assessment and establishment of key management decisions required for efficient and effective enterprise transition from point A to point B, C, D … X, which is, in another words, is a strategy development and implementation process.

2. As we all know from Shell experience, decision making process is about continuous learning. In this case, EASM enables the learning-by-design approach for key decision making stakeholders based on flexible and reliable enterprise-as-system model facilitates multi-dimensional and multi-purpose design-centric collaboration.

3. Based on continuous improvement paradigm, EASM consist of embedded practices facilitating iterative design improvement aimed to reach and raise the target performance level of the entire enterprise by means of design-by-learning approach. The approach is about the capability of rethinking and improvement of considered design of the enterprise based on individual and collaborative learning curve acceleration methods.

4. Thereby, EASM enables the architectural description of the enterprise which could and must act as an actual sufficient knowledge of the enterprise suitable for efficient and effective decisions making and implementation guidance.

EASM Key Components


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EASM Component Description

Enterprise-as-System Core Principles

The common principles valid for any organization’s existence and development based on:1. Assertion that every enterprise has an architecture regardless of the presence of architecture management function,

and this architecture needs to be managed in order to gain a strategic advantage.2. Set of the enterprise-as-system common features and its relationships (openness, diversity, emergence,

purposefulness, coherence, flexibility, sustainability etc.).3. Set of the enterprise-as-system consistent patterns.

ARM Architecture Reference Model, defines the reference architecture domains, domain’s building blocks and viewpoints interested in relevant building blocks according to key corporate executive functions.

AAMI Architecture Assessment and Modelling Instruments, including:1. System Compliance Assessment2. System Coherence Assessment3. System Dynamics Assessment4. Derived Instruments (Capability-based Planning, Agreement-based Methods, Value Chain Methods, Profit-based

Valuation Methods)

ACMP Architecture Change Management Process, defines the unified process for any type of architecture-related change management in context of:1. As-is Enterprise State Review,2. To-be Enterprise State Development, inc. Design, Planning, Budgeting and Evaluation3. To-be Enterprise State Implementation,4. To-be Enterprise State Establishment- in accordance with capability-based management approach and PDCA continuous improvement paradigm.

Architecture Reference Model Overview


Enterprise Architecture

ARM Domains (EASM Enterprise Architecture Scope)


FinancialArchitecture

MarketArchitecture

MotivationArchitecture

InfrastructureArchitecture

OperationalArchitecture

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1. Motivation Architecture defines the behavior prerequisites of internal and external stakeholders which are the crucial change drivers for any enterprise.

2. Transformation Architecture defines the overall enterprise capabilities required to achieve strategic business outcomes in terms of As-is – To-be enterprise transformation.

3. Market Architecture defines the marketplace of the enterprise in terms of marketing “war” strategy focused on brand and product portfolio.

4. Financial Architecture defines both resourcing and value aspects of the enterprise in terms of the relevant cost and corporate equity structure.

5. Operational Architecture defines the enterprise constitution within the context of its functions, structures and behavior.

6. Infrastructure Architecture defines the technological enablers of organization required for automation and information management of its value chain.

TransformationArchitecture

ARM Domains (EASM Enterprise Architecture Scope)


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ARM Domain Description

Motivation Architecture Motivation Architecture defines the behavior prerequisites of internal and external stakeholders (shareholders, executives, org. units, consumers, competitors, suppliers, regulators etc.) which are the crucial change drivers for any enterprise. This domain describes the enterprise stakeholders, their objectives, expectations, associated risks and influence by means of the value paradigm. Functional, operational and business strategy in the associated ecosystem context are the key areas of this domain.

Transformation Architecture Transformation Architecture defines the overall enterprise capabilities required to achieve strategic business outcomes in terms of As-is – To-be enterprise transformation. However, this domain it about to define the portfolios, programs, projects and initiatives required to acquire or develop target capabilities at the target performance level. Transformation Architecture delivers the bridge between up-down strategic planning, RnD and “upstream” continuous improvement innovations through the systematization of mentioned activities outcomes at the transformation portfolio model.

Market Architecture Market Architecture defines the marketplace of the enterprise in terms of marketing “war” strategy. This domain is focused on the company’s position on its target markets subject to commercial and regulatory restrictions within the context of unique trade proposal (UTP). Domain’s key objective is differentiation and systematization of brand and product portfolio aligned with the relevant identity proposition which are the key areas of the domain.

Financial Architecture Financial Architecture defines both resourcing and value aspects of the enterprise in terms of the relevant cost and corporate equity structure. Corporate value tree, asset, financial, budget and capital structures are the key areas of this domain. Financial Architecture delivers the bridge between the enterprise capabilities and its performance potential through the value tree relationships between the technical, operational, marketing and financial measures of the enterprise (from particular asset/ activity cost and revenue structure to market capitalization and EVA).

Operational Architecture Operational Architecture defines the enterprise constitution in context of its functions, structures and behavior (inc. agreement-based interaction with counterparties). Domain’s key objective is systematization of operations management. Organization structure, value chain, business process, service and competence model are the key areas of this domain.

Infrastructure Architecture Infrastructure Architecture defines the technological enablers of organization required for automation and information management of its value chain. Technological processes and the relevant ICT / production systems architecture are the key areas of this domain (inc. data, information, software, facilities, equipment and technology layers).

Enterprise Architecture

Transformation “Architecture”Business Architecture

A Reference between EASM EA Scope and “traditional” EA Scope


MarketArchitecture

FinancialArchitecture

OperationalArchitecture

Infrastructure Architecture*

MotivationArchitecture

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DataArchitecture

TechnologyArchitecture

Applications Architecture

ARMDomain

“Traditional”EA Domain

TransformationArchitecture

* - unlike “traditional” EA frameworks, ARM infrastructure architecture domain covers both ICT and production systems and facilities at the data, application and technology layers

ARM Building Blocks (EASM Key Units of Management)


Financial Architecture

Market ArchitectureMotivation Architecture

Infrastructure Architecture

Transformation Architecture

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Data and Information Applications Technological

Processes

Infrastructure(Facilities, Equipment, Software and Technology)

Portfolios Programs Projects and Initiatives

Capabilities

ProductsDrivers Values Objectives

Stakeholder Concerns

Brands(Identity)

Value Tree Capital Structure

Asset StructureFinancial and Budget

Structure(inc. FRC Structure)

Operational Architecture

Services Competences Business Processes

OrganizationStructure Value Chain

Architecture Reference Model Taxonomy

Reference Models

Domain Reference Models

Model Kinds

ARM Taxonomy


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Compliance(Ex.: Requirements Compliance Matrix)

Structure

Affection(Ex.: Performance Models and Scenarios)

Interaction(Ex.: Business Process Flows and Value Chain Models)

Tree(Ex.: Organization, Financial and

Master Data Structures)

Network(Ex.: Business Environment and

Knowledge Models)Enterprise-as-System Reference ModelComponents and its relationships inherent for any kind and domain of an enterprise

FinancialReference Model

MotivationReference Model

System Structural Reference ModelStructural elements and its

relationships inherent for any kindof system

Transformation Reference Model

OperationalReference Model

MarketReference Model

InfrastructureReference Model

Enterprise-as-System Meta Model

System Features Reference ModelFeatures and its relationships inherent

for any kind of system

System Reference ModelCore components and its relationships inherent for any kind of system

Architecture Change Management Process Overview


ACMP PDCA Lifecycle


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Architecture Change Management Process

As-is Enterprise State Review

To-be Enterprise State Implementation

To-be Enterprise State Establishment

To-be Enterprise StateDevelopment

Performance Management

A

P

D

C

ACMP Overview


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As-is Enterprise State Review To-be Enterprise State Development

To-be State Design

To-be State Planning

To-be State Budgeting

To-be State EvaluationCapability Assessment(inc. Internal Audit) As-is State Evaluation


Solution Delivery

Architectural Governance and Supervision

To-be Enterprise State EstablishmentImplemented

To-be StateAssessment

ImplementedTo-be State

Establishment

Learned Lessons Report Development


Performance Evaluation

Performance Resolution

AAMI

Ad-hoc Change Management

Enterprise Architecture Methodology Development

Benchmarking Foresight Environment Assessment

ACMP: How It Works?


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Performance M

anagement

Ad-h

oc C

hang

e M

anag

emen

t

Enterprise Architecture Methodology Development





Employee’s Initiative N

Business Change N

Technology Change N

LegacyChange N

EconomyChange N

SocialChange N

Business Initiative N

1. Performance management process is embedded in every architecture management stage in order to ensure the quantified effectiveness and efficiency of key architecture-related management decisions (both at the enterprise and solution level, from particular capability improvement outcomes to strategic business goals, from particular project cash flow to the company’s EVA and market capitalization).

2. Ad-hoc change management process is integrated with every architecture management stage as a single entry point for any type of change which can affect As-is or To-be enterprise state (as a risk or opportunity). This integration ensures the relevance of To-be state and safety of its implementation process, which means the assurance that every change is early identified and well managed according to gain a strategic advantage. Further, this is the bridge between the corporate RnD, continuous improvement, business strategy development and EA management process.

3. EA methodology development process is integrated with To-be state establishment stage ensures the methodology-related To-be implementation learned lessons becomes the requirements for the next version of improvedin-house EA methodology.

EnvironmentChange N

Capability NCapability 1

ACMP Performance Management Principal Scheme


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EBITDA

Business Process 1 Business Process 2 Business Process N

Competence 1 Competence N BusinessService 1

BusinessService N Facility 1

Application Service N Technology N

Facility N

Technological Process N

KPI 1 KPI N KPI 1 KPI N KPI 1 KPI N KPI 1 KPI N KPI 1 KPI N KPI 1 KPI N

KPI 1 KPI 2 KPI N KPI 1 KPI 2 KPI N

KPI 1 KPI 2 KPI N KPI 1 KPI 2 KPI N KPI 1 KPI 2 KPI 3

KPI 1 KPI 2 KPI N

OPEX KPI 1 OPEX KPI 2 OPEX KPI N Revenue KPI N CAPEX KPI N

OCF ICFNPV

EVA

KPI N

Driver 1 Driver 2

Driver N

Driver 3

Other enterprise-wide KPI 1

Other enterprise-wide KPI N

KPI N KPI N

The performance model above is an example intended to represent the relationships between the key drivers and KPIs at all the levels of particular segment architecture.The model uses a corporate value tree as a skeleton to ensure the economical efficiency of particular transformation solution. Such models are used to fulfill the ACMP performance evaluation process for any required sufficient part of EA and underlies the business case of the correspondent transformation portfolio, program, project or initiative.

ACMP Integration Scope


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Budgeting

Corporate Portfolio

Management

InvestmentManagement

Asset Management

Business Process Management

Production Planning and

Control

Strategic Management

Product Management

Value Management

RnDManagement

Accounting and Controlling

ICT ManagementQuality Assurance

ACMP Capability-based Planning as a bridge betweenArchitecture and Corporate Portfolio Management


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Program 1 Program N

Project 1

Project N

Project 1

Project N

Program 1

Project 1

Project N

Project 1

Program 1 Program N

Project 1

Project N

Project 1

Project N

Program 1 Program N

Project 1

Project N

Project 1

Project N

Project N

Portf

olio

NPo

rtfol

io 3

Portfolio 1 Portfolio 2

Capability 1(Segment 1)

Capability 2(Segment 2)

Capability N(Segment N)

Capability 2.2

Capability 2.1

Capability 2.N

Strategic Objective 2

Strategic Objective N

Strategic Objective 1

Capability 2.2.2

Capability 2.2.1

Capability 2.2.N

Architecture Assessment and Modelling Instruments Overview


AAMI Overview


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AAMI Description

System Compliance Assessment The instrument is using for assessment of the level of compliance provided by the enterprise or its particular components (capability, service, competence, funding scheme, process, facility etc.) according to established requirements (industry, quality, accounting, reporting or parent company standards; shareholder, customer or system requirements; architectural, accounting, technical and other policies etc.).

System Coherence Assessment The instrument is using for assessment of the level of the enterprise coherence (inc. coherence of particular enterprise capabilities) in the context of:1. sufficiency, completeness, integrity and non-redundancy of relationships between its components;2. appropriate level of coupling and granularity of its components;3. appropriate level of accountability for each significant component in terms of the current and target competence,

role and decision making model;4. balance of its components both from the vertical (driver – objective – capability – service – facility etc.) and

horizontal perspective (cross-functional balance, portfolio and budget balance etc.).

System Dynamics Assessment The instrument is using for assessment of non-linear consistent patterns and its consequences in the case of long-term architecture-related management decisions. The mentioned consequences is obvious for system dynamics non-linear viewpoint and unobvious for “traditional” linear viewpoint. Considering enterprise as a non-linear dynamic system, the instrument provides minimalistic “executive-friendly” language based on the feedback environment modelling enabling various scenario development and comparison for any enterprise transformation initiative in context of its pitfalls and hidden opportunities which is invisible for existing linear analysis methods.

Derived Instruments 1. Capability-based Planning2. Agreement-based Methods3. Value Chain Methods4. Profit-based Valuation Methods (as an instrumental base for ACPM performance management process)

AAMI in Application to Key EA Modelling Activities


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Identify a modelling approach

Agreement-based Methods

Verify or integratea model

Value Chain Methods

Capability-based Planning

System Coherence Assessment

System Compliance Assessment

Quantify a model(if required)

Build / run a model-based scenario

System Dynamics

Assessment

Profit-based Valuation Methods

Build a modelfor performance

models

for interaction models

More about EASM?


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You can learn more about EASM refer to the following materials:

1. EASM Version 4.0 Specification.

2. EASM Version 4.0 Case Studies and Success Stories Overview.

3. An Introduction to EASM for System Engineers and Manufacturing Practitioners.

4. An Introduction to EASM for CFO.

To use the EASM Architecture Reference Model as a modelling notation, you can download the following plugins:

5. EASM ARM Version 4.0 Plugin for ARIS Business Architect.

6. EASM ARM Version 4.0 Plugin for Sparx Enterprise Architect.

7. EASM ARM Version 4.0 Stencil Set for MS Visio.

To access the above materials or modelling plugins, please contact us at [email protected] (please introduce yourself, your company, the list of required plugins/ materials and your subject of interest in EASM).

mailto:[email protected]

Thank You for your time!

Copyright © 2014, «Center for Effective Organizations» Ltd. (CEO Ltd.).

All rights reserved

EASM is a registered trademark of CEO Ltd. Any unauthorized usage or distribution is prohibited by the law.
