At its most granular level, the SEA specifies the various
information technologies in use. In leading organizations,
these are now expressed as a service-oriented architecture,
whereby software is maintained as modules that can be combined to create applications as needed—sometimes by business users. An SOA can reside either within the organization
or in the cloud. An SOA is not a necessity to work in the cloud,
but it adds tremendous flexibility as the organization senses
and responds to changes in its environment.
Another essential management capability is organization
and change management. An SEA should indicate whether
existing organizational structures help or hinder the overall
strategy. This includes entire divisions, as well as working
groups and reporting relationships. It should lead to questions
such as: Do we have the right people in the right places? Do
they have the training they need? Are their incentives encouraging them to do what we need them to do?
Do currently available clouds have the technical sophistication we need?
Above all, what can—and should—we do differently by using
At some point, your enterprise will need to answer the
pivotal question: Is the company as a whole better off?
To answer that, you first need to ask some basic questions: Are we finding and retaining good customers? Is cloud
computing delivering new, innovative products to them? Is
it adjusting on the fly to changes in customer demand, marketplace realities, new technologies and competitor moves?
Beyond that, what are changes in management and technology
doing for our bottom line?
BTM Institute research has shown a direct correlation
between maturity in business technology management capabilities and the financial performance of an enterprise as a
whole. Enterprises with a more closely converged business and
technology management exhibit superior revenue growth and
net margins relative to their industry groups. Their returns on
equity, assets and investments are higher.
Taking the holistic measure of an enterprise’s performance
is a straightforward process. This measurement can be combined with interim assessments on the current efficiency of
individual business processes and in a projected best state,
and the costs of internal versus external computing. In no case
should these measures be made in isolation from their impact
on customers and the firm’s overall purpose and strategy.
Now is the time to wrestle with these issues. Purveyors of
cloud computing—from traditional big-picture providers like
IBM to relative newcomers like Salesforce.com—are ramping
up their capabilities, looking for benefits in joint ventures and
trying to understand the value proposition for future customers.
Traditional suppliers of pay-per-seat, one-niche software applications are also trying to figure out where they fit in.
Some “big thinkers” are prophesying the end of information technology departments as we know them. It is more
likely, however, that IT organizations will continue in a new,
more strategic role. The CIO will become truly the chief
information officer, as opposed to the chief
information technology officer, signifying
a shift in focus from the technology to its
ultimate purpose of serving and supporting
So poke your head into the cloud and have
a look around. Enjoy the promise of the technology. But keep your mind firmly focused on
the business. 3
MEASURING FINANCIAL VALUE
These capabilities—and 15 others—are taken from the Business
Technology Management Framework, a management standard promulgated by the Business Technology Management
Institute. The institute also has a maturity model designed to
assess the progress of organizations in adopting these capabilities. The model specifies five levels of maturity, which can be
determined using an assessment tool.
To determine the first measurement of your enterprise’s
readiness to move to the cloud, you must assess your management’s readiness in areas such as strategy and planning,
technology investments and managing partnerships. Cloud
computing is not an incremental variant of classic outsourcing.
It is more fundamental, and your organization must be ready
for it. If it’s not—if it blindly pursues the cloud without the
clarity of an SEA and with the organization arrayed as it has
always been—then you can expect less than pleasing results.
Your company could move all or some of its computing to
a cloud and simply compare the costs of cloud versus in-house
computing, but that would be missing the larger potential. You
might just be trading one source of computing
for another in support of redundant or inefficient business processes. If your enterprise takes
the time to create an SEA that includes both current and desired state scenarios, it can optimize
the entire business, not just the technology.
Strategic enterprise architecture, along with
maturity in these other capabilities, can help
you answer questions such as the following:
What information do we need that we aren’t
getting? How can we get it?
What information could we have with the
resources of a cloud or grid? Would this give
us the basis for a new strategic thrust?
How would we benefit from more
sharing of information internally and
externally? Would a cloud enable this?
Is anyone managing each process end
to end? How does a process interact or
interfere with others? What effect does
each process have on customers?
Faisal Hoque is the chairman and CEO of BTM
Corp. ( www.btmcorporation.com). BTM
innovates new business models and enhances
financial performance by converging business
and technology with its products and intellectual property.
Please send ques-
tions and comments
on this article to