The true scope of enterprise architecture

This article addresses what is, or should be, the true scope of enterprise architecture.

To date, most enterprise architecture efforts have been focused on supporting IT’s role as the ‘owner’ of all applications and infrastructure used by an organisation to deliver its core value proposition. (Note: in this article, ‘IT’ refers to the IT organisation within a firm, rather than ‘technology’ as a general theme.)

The view of the ‘enterprise’ was therefore heavily influenced by IT’s view of the enterprise.

There has been an increasing awareness in recent times that enterprise architects should look beyond IT and its role in the enterprise – notably led by Tom Graves and his view on concepts such as the business model canvas.

But while in principle this perspective correct, in practice it is hard for most organisations to swallow. So most enterprise architects are still focused on IT-centric activities, which most corporate folks are comfortable for them to do – and, indeed, for which there is still a considerable need.

But the world is changing, and this IT-centric view of the enterprise is becoming less useful, for two principle (ironically) technology-led reasons:

  • The rise of Everything-as-a-Service, and
  • Decentralised applications

Let’s cover the above two major technology trends in turn.

The rise of Everything-as-a-Service

This is a reflection that more and more technology and technology-enabled capability is being delivered as a service – i.e., on-tap, pay-as-you-go and there when you need it.

This starts with basic infrastructure (so called IaaS), and rises up to Platform-as-a-Service (PaaS), then up to Software-as-a-Service (SaaS) and finally  Business Process-as-a Service (BPaaS) and its ilk.

The implications of this are far-reaching, as this research from Horses for Sources indicates.

This trend puts the provision and management of IT capability squarely outside of the ‘traditional’ IT organisation. While IT as an organisation must still exist, it’s role will focus increasingly on the ‘digital’ agenda, namely, focusing on client-centricity (bespoke optimised client experience), data as an asset (and related governance/compliance issues), and managing complexity (of service utilisation, service integration, and legacy application evolution/retirement).

Of particular note is that many firms may be willing to write-down their legacy IT investments in the face of newer, more innovative, agile and cheaper solutions available via the ‘as-a-Service’ route.

Decentralised Applications

Decentralised applications are applications which are built on so-called ‘blockchain’ technology – i.e., applications where transactions between two or more mutually distrusting and legally distinct parties can be reliably and irrefutably recorded without the need for an intermediate 3rd party.

Bitcoin is the first and most visible decentralised application: it acts as a distributed ledger. ‘bitcoin’ the currency is built upon the Bitcoin protocol, and its focus is on being a reliable store of value. But there are many other protocols and technologies (such as Ethereum, Ripple, MasterCoin, Namecoin, etc).

Decentralised applications will enable many new and innovative distributed processes and services. Where previously many processes were retained in-house for maximum control, processes can in future be performed by one or more external parties, with decentralised application technology ensuring all parties are meeting their obligations within the overall process.

Summary

In the short term, many EA’s will be focused on helping optimise change within their respective organisation’s, and will remain accountable to IT while supporting a particular business area.

As IT’s role changes to accommodate the new reality of ‘everything-as-a-service’ and decentralised applications, EA’s should be given a broader remit to look beyond traditional IT-centric solutions.

In the meantime, businesses are investing heavily in innovation accelerators and incubators – most of which are dominated by ‘as-a-service’ solutions.

It will take some time for the ‘everything-as-a-service’ model to play itself out, as there are many issues concerning privacy, security, performance, etc that will need to be addressed in practice and in law. But the direction is clear, and firms that start to take a service-oriented view of the capabilities they need will have a competitive advantage over those that do not.

 

 

 

 

 

The true scope of enterprise architecture

Decentralised Applications in FinTech

The new ‘Decentralised Applications in FinTech’ blog is all about how blockchain technology underpinning digital currencies such as Bitcoin can be used to innovate, improve, disrupt and re-invent processes in financial services.

The key concept is ‘decentralised applications’ – applications or systems which do not rely on a single entity to manage the substance of agreements between two or more transacting but otherwise independent counter parties, but rather which delegate such responsibility to the technology and the mathematically robust algorithms underpinning established and emerging digital currencies.

Decentralised applications have the potential to dramatically increase innovation, reduce costs, improve services, reduce risk, improve compliance and generally create a whole class of new economic opportunities for people who may not even be aware that these technologies are involved.

As it stands today, this vision is still only potential: it may not be realised.

The blog will attempt to communicate a shared understanding within the FinTech community of the benefits and opportunities  (or not) that Decentralised Applications could bring to Financial Services specifically, and to dependent industries, through innovative payment models.

The blog can be accessed here.

Decentralised Applications in FinTech