Nowadays, Enterprises are in an uncomfortable position. On the one hand, their industries are being disrupted by new competitors, and the pace of innovation has increased dramatically. On the other hand, they need to run a vast legacy IT landscape which thwarts the implementation of innovative digital solutions that integrate the old with the new business & IT.
Companies put a tremendous effort into innovation initiatives. These efforts are fuelled by the necessity to have more modern digital business capabilities in the organization, in order to stay competitive. They must be capable of quickly deploying technology that produces business value.
Driven by this demand, communities surrounding Agile and Design Thinking are growing rapidly. Both ideas focus on speed and innovation, but do not answer the question of how to ensure that created solutions fit together and into the big picture of the enterprise. They do not answer the question of how to deal with the enormous ‘technical debt’ that is created by grubby integration of new digital solutions with legacy or with each other. They are speedy in the short term, but do not answer the question of how to maintain this speed in the long term.
Focusing solely on new ways to create customer value, without seriously considering sustainability and architectural integrity, creates point-solutions and enormous costs in the long-term. This can be taken as a proven fact, if you only think of what has happened to application landscapes over the past decades with a much slower pace of innovation:
In our experience of carrying out enterprise architecture, we would estimate that the IT of a typical organization of the ‘old economy’ has ten times more applications, servers, databases, than would be necessary if business and IT had been properly architected. This is the reason why current application landscapes are not agile for adding new functionalities. 90% of the IT costs could have been saved, if architectural thinking had been applied properly.
And this is not an IT problem. The severe situation has been caused by the absence of the notion of architecture in the business world.
Issues such as:
- overlapping responsibilities between business units;
- unclear data and process ownerships;
- business unit silos;
- weak connections between departments that structure the business (such as strategy creation, business model generation, product management, business process management)
are common for any large organization I have ever worked in.
If we project this existing situation into the future of faster and faster innovation cycles, it becomes clear that without a structured approach to managing the dependencies between business & IT structures, complexity will increase exponentially. Companies simply must solve this problem as long as they can afford to do so. They must invest in legacy business & IT renovation in order to reduce complexity, and must learn how to integrate new digital solutions into their legacy IT and business processes in a way that keeps technical and organizational debt within reasonable bounds. They must learn how to make informed decisions that are based on holistic viewpoints that integrate business & IT architecture. They must start to build structured connections between any level of the business and IT organization.
They need to start Architectural Thinking.