Digital Transformation and Disruption – A Conversation with Sriram Sabesan

By The Open Group

The term “disruption” has been the de rigueur description for what’s been going on in the technology industry for a number of years now. But with the pressures of a digital economy facing all industries now, each is being disrupted in numerous ways.

Although disruption is leading to new and better ways of doing things, it can also be devastating for businesses and industries if they choose to ignore the advances that digitalization is bringing. Companies that don’t want to be left behind have to adapt more quickly than ever—or learn to disrupt themselves.

Sriram Sabesan, a partner with Conexiam, believes that a certain amount of disruption, or mitigations to disruptions, can indeed by architected by an enterprise—if they have the foresight to do so. We spoke with him in advance of his session at The Open Group San Francisco 2017 event to learn more about how enterprises can architect their own disruptions.

We’ve been hearing a lot about disruption over the past few years. How do you define disruption and what is the disruption curve?

Disruption normally happens when you don’t anticipate something and the change suddenly occurs on you.  In fact, the changes have been happening, but no one has taken the time to connect the dots. To give an example, let us consider an individual holding a mutual fund, which has significant stakes in property and casualty (P&C) insurance businesses.  The impact of a shared economy (Uber, Lyft, Airbnb) is that the number of ‘owners’ is likely to stay flat or see marginal increase.  This cascades into a smaller number of insured people, hence diminished revenue for the insurance provider.  This impacts the stock valuation of the P&C companies, finally, impacting the individual owning the mutual fund with interest in P&C sector.  And that’s a foresight people might not have. This is not about crying ‘wolf,’ but about mitigating potential risk to an asset—at every step of the chain.

Let us take another example. Most manufacturing businesses hold reasonable stock of spare parts to their machinery.  Even at home, we hold metallic clips, nails, etc.  With 3D printing, one may be able to reuse the raw materials—sheet metal or plastic or whatever they’re trying to manufacture for the main product to create the spare-parts.  At home, we don’t have to stock clips, pins or nails—but raw material.  3D printing impacts the businesses that are producing these products todays.  Some positively (example e-Nable – http://enablingthefuture.org/) and some in unknown ways.

It is about walking the chain.  The company adopting a new technology or approach may not be the one getting impacted.  It may not be about the industry vertical that is adopting a new model.  It’s mostly likely the cascading effect of people taking part in the diluted chain that are impacted. It’s a system of systems game.

The Disruption Curve is based on product maturity ‘S-curve.’  Familiarity breeds contempt and raises expectations.  As people get used to do something in a certain way, some start to notice the little annoyances, and others want to do things differently or better.  For businesses, it is the necessity to create a new revenue model.  The next S-curve is born when the old S-curve approaches its top end.  The best definition is given by Prof. Clayton Christensen from Harvard Business School. However, the simplest interpretation could be ‘an unexpected change to the way one does things or when someone is unseated.’  For this topic, I think everyone is trying to improve their personal productivity, including better disposable income, a dose of vacation or a personal moment for themselves.  Any and all of these will cause a disruption.

In your opinion, what have been the biggest industry disruptions to occur in the past 10 years?

Most of the changes happened in isolation in the past.  There was no significant combinatorial effect that could transcend multiple industry verticals like today.

Google disrupted search; Amazon disrupted in-store purchase models; Netflix  the DVD rental market.  They all leveraged the internet. Google was able to capture and connect contents of websites, scanned copies of books, triggering the birth of  ‘big data’.  And Amazon on the other side, when they started having too many products, they couldn’t have an ecosystem that could support the enterprise across the globe and they came up with the AWS system. What they made internally, they also made a commercial, external facing product. Skype changed telephony; Paypal changed money exchange. 

Growth in metallurgy and medical sciences evolved from the foundations laid in the later half of last century.  Growing human body parts in lab, implantable devices, etc. The last decade made remote, continuous monitoring of human behavior and health possible.

But the biggest change is that all these companies discovered that they actually depend on each other.  Netflix on AWS, AWS on fiber optic cable owners, both of them on the last mile internet service providers, etc.  That realization, and the resultant collaboration via open standards is the biggest of all.

All of them changed some of the fundamentals of human-to-human interaction and human-to-machine interaction.  The new model made any individual able to provide a solution rather than waiting for large enterprises to initiate changes.

Who have been the most influential disruptors—is it just the usual suspects like Uber or Airbnb or are there others disruptors that are having a greater influence on industries that people are less aware of?

It depends on the vertical. As I said before, the past decade has been limited to a single vertical.

If you think about tax filing, Intuit has been the most influential in that area with Turbo Tax. They made a lot of things easier. Now you can take a picture of your W2 and 80% of your filing work is completed. Using another product, Mint.com, they became a personal finance advisor in a non-intrusive way—working with your banks, investment accounts and credit card accounts.  PayPal and Square are disruptors in the ecommerce and money movement sectors.

Each vertical had its own set of disruptors, not everyone came together. But now more and more people are coming together because the services are so interdependent. Apple with its iTunes changed the whole music industry. Amazon Kindle for books.  IBM with its Watson is changing multiple verticals.

Medical devices are also undergoing a lot of change in terms of things that could be planted in human beings and monitored wirelessly so it can give real-time information to doctors. The most common human behavior is to visit doctors when we are not healthy. Doctors don’t have data points on the transition from a healthy state to an unhealthy state, what happened, why it happened. Now they can monitor a person and behavior continuously. I recently read about an emergency room operation that used the data from a FitBit to figure out what happened to a patient and treat the patient very quickly. They saw the transition and the data points stored in the device and were able to diagnose the patient because the patient wasn’t conscious.

So, I guess, there are more unusual suspects and players.  To name a few: Khan Academy and Open Courseware in education, e-Nable for exoskeletal structures, derivatives of military’s ‘ready-to-eat-meals’.  There are also new products like ‘Ok Google,’ ‘Alexa’ and ‘x.ai’ which combines several aspects.

Your talk at The Open Group San Francisco advocates for an “architected approach” to disruption. Can disruption be architected or is there a certain amount of happenstance involved in having that kind of impact on an industry?

There is some element of happenstance.  However, most of the disruptions are architected.

An enterprise invariably architects for disruption or reacts rapidly to mitigate disruptive threats to sustain a business.  There are some good examples that go unnoticed or written off as the natural evolution of an industry.

I believe Qantas airlines was the first to realize that replacing seat mounted inflight entertainment (IFE) units with iPads saved at least 15 pounds per seat.  Even after adding 40% more seats, eliminating these devices reduced the overall weight of a Boeing 777 by 7%.  Simply by observing inflight human behavior and running test flights without IFEs, airlines architected this change.  The moment the savings was realized, almost every airline followed.  This is an example of architected change.  As regulators started accepting use of wifi devices at any altitude, compliance work done at the gate, by the pilot and maintenance crew also switched to hand-held devices.  Less paper and faster turnaround times.  Savings in weight resulted in lower overall operating cost per flight, contributing to either lower prices or more cargo revenue for the airline.

Every enterprise can anticipate changes in human behavior or nudge a new behavior, build a new business model around such behaviors.  Apple’s introduction of touch devices and natural interfaces is another example of well-architected and executed change.

There are parts of a business that need significant effort to change due to cascading impacts, say an ERP system or CRM or SCM system.  Even shifting them from on-premise to cloud would appear daunting.  However, the industry has started to chip away the periphery of these solutions that can be moved to cloud.  The issue is not technical feasibility or availability of new solutions.  It is more about recognizing what to change and when to change.  The economics of the current way of doing things balanced against cost of change and post change operations will simplify decision making.  The architect has to look outside the enterprise for inspiration, identify the points of friction within the enterprise, and simply perform a techno-economic analysis to architect a solution.

Sometimes a group of architects or industries realize a need for a change.  They collectively guide the change.  For example, consider The Open Group’s new Open Process Automation Forum.  What would normally appear to be disconnected verticals – Oil and Gas, Food Processing, Pharmaceuticals, Fabric and Cable manufacturers have come together to solve process management problems.  Current equipment suppliers to such companies are also part of the forum.  The way the forum works will lead to incremental changes. The results will appear to be natural evolution of the industry but the fact that these folks have come together can be called a disruption to an otherwise normal way of operations.  With this, there is the possibility of collaboration and mutual learning between operations technology and information technology.

I know of car companies, insurance companies and highway management companies who started silent collaboration to explore solar panels embedded on the road and live charging of automobiles.  An extended ‘what if’ scenario is the use of GPS to identify the availability of solar panel embedded roads matched with driving behavior of the car owner to make a decision whether the charge on the car’s battery can be used as source of power to reduce the burden on the electric grid.  Last month I read an article that the first solar panel road is a reality.  For metering and charging of power consumption, this may not be much of a disruption.  But other adjoining areas like regulations, parking privileges, toll charges will be impacted.  It is a question of how soon the players are going to react to make the transition gradual or suddenly wake up to call them disruptions.

Is it possible for established enterprises to be the arbiters of disruption or is that really something that has to come out of a start-up environment? Can an architected approach to disruption help established companies keep their edge?

Yes and no. The way most companies have grown is to protect what they’ve already established. A good number of organizations operate under the philosophy that failure is not an option, which implies that taking risks has to be reduced which in turn stifles innovation. They will innovate within the boundaries and allowances for failures. Start-ups have a mindset that failure is an option because they have nothing else to lose. They are looking for the right fit.

To be an arbiter, start-up or established enterprise, take a page from the research on Design Thinking and Service Blueprinting by Stanford University.  It provides a framework for innovation and possibly disruptions by any organization – not just the start-ups.  Progressive’s telemetry device is just the beginning.  Once the customers understand the limits of privacy management, all insurance companies will change the way they rate premiums.  Just learn from the rapid changes the TSA made for full-body scanners.  Scanned images rapidly changed from close to real body shape to a template outline.  Customer outrage forced that change.

Some big enterprises are actually working with start-ups to figure out what changes the start-ups want to do, what kind of pain points they’re offsetting. There are companies who work with an agenda to change the operating model of the whole industry. 

In the U.S., one can look at CaptialOne, Amazon (the retail business, not AWS), MegaBus, and Old Navy for creating new business models, if not a complete disruption.  Expedia created GlassDoor, and Zillow; Expedia was founded on making search, comparison of competitive offers and decision-making simple. The bottom line is whether the philosophy with which an enterprise was created has become its DNA, resulting in new verticals and value creation in the eyes of the investors.

It is possible to have an architected disruption approach moving forward but it comes from a place where the company defines the level of risk and change they’re willing to bring. At the end of the day, public companies are under constant pressure for quarterly results so big changes may not be possible; but they may be doing small incremental things that morph into something else that we cannot easily see.

Is architected disruption a potential new direction that Enterprise Architects can take as either a career path or as a way to show their continued relevance within the enterprise?

Yes. Let me qualify that. As things stand today, there are three kinds of architects.

Architects who guide and oversee implementation—people who have to make sure that what has been planned goes according to plan. These architects are not chartered to create or mitigate disruptions.  It is the task that is given to them that distances them from effecting big changes.

The second kind of architects focus on integrating things across businesses or departments and execute with the strategy leaders of the company.  These architects are probably on the periphery of enabling disruption or mitigating impacts of a disruption using an architected approach. These architects often react to disruptions or changes.

The third set of architects are trying to provide the strategy for the company’s success—creating roadmaps, operating at the edges of corporate charter or philosophy, thinking about every moving part within and outside the enterprise. They are on the watch out for what’s happening in human behavior, what’s happening in machine behavior and what’s happening in automation and trying to modify the portfolio quarter by quarter, if not sooner.  It is tricky for these architects to keep track of everything happening around them, so it is normal to get lost in the noise.

With the right attitude and opportunity, an architect can create a career path to move from the first kind to the third kind.  Having said that, let me be clear, all three kinds of architects are relevant and required for an enterprise to function.

Is there a role for standards in architected disruption?  

Yes.  The standards provide a buffer zone to limit the impact of disruption.  It also provides a transition path to adopt a new way of doing things.

The standards help in a couple ways—The Open Group sets standards for Boundaryless Information Flow™.  At the end of the day, no business is an island. So when a payment or financial e-commerce transaction changes from a bank to a PayPal account to a mobile wallet or a phone number, you need to have certain communications protocols, certain exchange standards to be defined. What kind of failure mitigation one needs to have in place needs to be defined—that’s one.

Second is supporting management decision makers—CEOs, COOs. We have to provide them the information that says ‘if you do this within this confine, the possibilities of failures go down.’ It’s about making it easier for them to decide and take on a change effort.

The standards provide a framework for adopting the change as well as a framework for helping management decisions mitigate risk and for making an ecosystem work well together.

Are there any other ways that disruption can be planned for?

One way is to look at the business patterns, the economic indicators that come along with these patterns.

Would Uber have survived in the mid-to-late 1990s? Probably not, because of the growing and more affluent economy. The economic pressure of the late 2000s diminished total disposal income so people were open to certain changes in their habits. Not only were they open in their thinking about socializing, they were open to penny-pinching as well.

There are parts of businesses that are hard to change, like the logistics management and ERP systems of an airline; clearing house operations of banking systems; cross-border, high-value sales.  There are parts of the business that can change with minimal impact.  Gartner calls this concept Pace-Layering.  We have to look for such layered patterns and make it easier to solve.  And the growth part will be complemented by what’s going on outside the enterprise.

There are a lot of examples of products that were way ahead of their time and for users to imagine / accept the change, and hence failed.  Uber or Ford, despite following different approach to deliver their product to the market, focused on the problem of mobility, the economic and social climate, and were willing to innovate and iterate. Oxo products, for example, though they cannot be technically classified as disruptors, changed the way we look at kitchen tools.  Oxo focused on user research and product fit.

So the winning formula is to focus on market and customer needs.  Start with accepting failure, test like there is no tomorrow. And at the hint of a tipping point, scale.

@theopengroup #ogSFO
by-the-open-groupSriram Sabesan leads the Digital Transformation practice at Conexiam.  He is responsible for developing best practice and standards in the areas of Social, Mobile, Analytics, Cloud and IoT (SMACIT), Customer Experience Management and governance.

Over the past 20 years, Sriram has led teams specializing in system engineering, process engineering and architecture development across federal, technology, manufacturing, telecommunication, and financial services verticals. Managing and leading large geographically distributed teams, Sriram has enabled clients develop and execute strategies in response to shifts technology or economic conditions.

Sriram has been an active member of The Open Group since 2010 and is on The Open Group Governing Board.  He has contributed to the development of Open Group standards, snapshots and white papers. He is an Open Group Certified Distinguished Architect and is certified in TOGAF® v8, Scrum Practice and Project Management.

Sriram holds a Bachelor of Science degree Mechanical Engineering and Master of Science (Tech) in Power and Energy.  Sriram also received his Diplomas in Financial and Operations Management in 1998.

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Looking Forward to a New Year

By Steve Nunn, President & CEO, The Open Group

As another new year begins, I would like to wish our members and The Open Group community a happy, healthy and prosperous 2017! It’s been nearly 15 months since I transitioned into my new role as the CEO of The Open Group, and I can’t believe how quickly that time has gone.

As I look back, it was at The Open Group Edinburgh event in October 2015 that we launched the IT4IT™ Reference Architecture, Version 2.0. In just the short time since then, I’m pleased to report that IT4IT has garnered attention worldwide. The IT4IT Certification for People program that we launched last January—one of the first things I had the pleasure of doing as CEO—has also gained momentum quickly. Wherever I have traveled over the past year, IT4IT has been a topic of great interest, particularly in countries like India and Brazil. There is a lot of potential for the standard globally, and we can look forward to various new IT4IT guides and whitepapers as well as an update to the technical standard in the first few months of this year.

Looking back more at 2016, there were a number of events that stood out throughout the course of the year. We were excited to welcome back Fujitsu as a Platinum member in April. The Open Group global reach and continued work creating standards relevant to how technology is impacting the worldwide business climate were key factors in Fujitsu’s decision to rejoin, and it’s great to have them back.

In addition to Fujitsu, we welcomed 86 new members in 2016. Our membership has been increasingly steadily over the past several years—we now have more than 511 members in 42 countries. Our own footprint continues to expand, with staff and local partners now in 12 countries. We have now reached a point where not a month goes by without The Open Group hosting an event somewhere in the world. In fact, more than 66,000 people attended an Open Group event either online or in-person last year. That’s a big number, and it is a reflection on the interest in the work that is going on inside The Open Group.

I believe this tremendous growth in membership and participation in our activities is due to a number of factors, including our focus on Enterprise Architecture and the continued take up of TOGAF® and ArchiMate® – Open Group standards – and the ecosystems around them.  In 2016, we successfully held the first TOGAF User Group meetings worldwide, and we also released the first part of the Open Business Architecture standard. Members can look forward to additions to that standard this year, as well as updates to the ArchiMate certifications, to reflect the latest version of the standard – ArchiMate® 3.0.

In addition, our work with The Open Group FACE™ Consortium has had a significant impact on growth—the consortium added 13 members last year, and it is literally setting the standard for how government customers buy from suppliers in the avionics market. Indeed, such has the success of The Open Group FACE Consortium been that it will be spinning out its own new consortium later this year, SOSA, or the Sensor Open Systems Architecture. The FACE Consortium was also nominated for the 2017 Aviation Week Awards in Innovation for assuming that software conforming to the FACE technical standard is open, portable and reusable. Watch this space for more information on that in the coming months.

2017 will bring new work from our Security and Open Platform 3.0™ Forums as well. The Security and Architecture Forums are working together to integrate security architectures into TOGAF, and we can expect updates to the O-ISM3 security, and OpenFair Risk Analysis and Taxonomy standards later in the year. The Open Platform 3.0 Forum has been hard at work developing materials that they can contribute to the vast topic of convergence, including the areas of Cloud Governance, Data Lakes, and Digital Business Strategy and Customer Experience. Look for new developments in those areas throughout the course of this year.

As the ever-growing need for businesses to transform for the digital world continues to disrupt industries and governments worldwide, we expect The Open Group influence to reach far and wide. Standards can help enterprises navigate these rapid changes. I believe The Open Group vision of Boundaryless Information Flow™ is coming to fruition through the work our Forums and Working Groups are doing. Look for us to take Boundaryless Information Flow one step further in January when we announce our latest Forum, the Open Process Automation™ Forum, at our upcoming San Francisco event. This promises to be a real cross-industry activity, bringing together industries as disparate as oil and gas, mining and metals, food and beverage, pulp and paper, pharmaceutical, petrochemical, utilities, and others. Stay tuned at the end of January to learn more about what some prominent companies in these industries have in common, in addition to being members of The Open Group!

With all of these activities to look forward to in 2017—and undoubtedly many more we have yet to see—all signs point to an active, productive and fulfilling year. I look forward to working with all of you throughout the next 12 months.

Happy New Year!

by-steve-nunn-president-and-ceo

by-steve-nunn-president-and-ceoSteve Nunn is President and CEO of The Open Group – a global consortium that enables the achievement of business objectives through IT standards. He is also President of the Association of Enterprise Architects (AEA).

Steve joined The Open Group in 1993, spending the majority of his time as Chief Operating Officer and General Counsel.   He was also CEO of the AEA from 2010 until 2015.

Steve is a lawyer by training, has an L.L.B. (Hons) in Law with French and retains a current legal practicing certificate.  Having spent most of his life in the UK, Steve has lived in the San Francisco Bay Area since 2007. He enjoys spending time with his family, walking, playing golf, 80s music, and is a lifelong West Ham United fan.

@theopengroup @stevenunn

 

 

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TOGAF® User Group Meetings

By The Open Group

Since its inception more than two decades ago, TOGAF®, an Open Group standard, has grown to become the de facto global framework for creating Enterprise Architectures.

Thousands of companies worldwide have adopted and adapted TOGAF to transform their businesses. Facts about TOGAF include:

  • 80% of the Fortune Top 50 companies use TOGAF
  • Over 60,000 individuals hold certifications in TOGAF 9
  • TOGAF users are based in 120 countries
  • Greater than 60 accredited training courses available globally

The Open Group wants to ensure that TOGAF maintains its momentum worldwide and realizes that doing so cannot be done without capturing the voices beyond the The Open Group members.  Additionally, there is an increase in the number of licensed TOGAF professionals who want to follow up their training with a forum for discussion and sharing. Thus, there is an opportunity to provide TOGAF Users to easily Share, get Enlightenment, and Express their needs (’SEE’ TOGAF).

The starting off point for The Open Group was to begin hosting TOGAF User Group Meetings, which move in a direction where users get more involved in their structure. With these meetings, The Open Group gets an opportunity to Harvest ideas on use, Educate users, have Access to larger user base and broader set of Requirements (‘HEAR’ about TOGAF use).

The User Group Meetings are open to all interested people and are free to attend.

So there is a win-win for TOGAF Users to meet. This part of the story is yet to be written!

For the upcoming TOGAF® User Group Meeting in San Francisco, CA on January 30, 2017, please visit here.

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Digital Transformation and Business Architecture (Part 3 of 3) – Presented by Dr. Giovanni Traverso, Huawei

At The Open Group Shanghai 2016 summit, we invited Dr. Giovanni Traverso, Chief Business Architect of HUAWEI Service Strategy and Architecture Practice, to give a keynote speech “New Open Business Architecture (O-BA) to Support the Construction of Digital Business and Smart Government”.

Huawei was a Diamond Sponsor of this summit, is a Platinum Member of The Open Group and is participating in the creation of the O-BA standard, whose first part was launched in July 2016 as a Preliminary Standard.

Giovanni, who is leading this effort within Huawei, presented Huawei’s perspectives on Business Architecture coming from best practices.

This is part three in a three-part series.

Part #3 – Business Architecture Answers the Business Questions

When undertaking our transformation efforts we need to answer, in a structured way, the inherent business questions, such as:

How to ensure a common understanding of the transformation within the organization? How to align an organization and its constituents towards the goal? Do we have the necessary skills and what changes should we drive, even in our organization’s culture? How to unleash technology-driven innovation to lead business model innovation, as well as the other way round? How processes and organization are going to be impacted? How to identify priorities? What about dependencies and risks?

More importantly: how to focus investments and ensure that the desired business outcomes will be achieved?

How our partners and channels are going to be impacted? How our customers/users’ experience is going to be impacted?

The O-BA standard reflects industry best practices addressing the business view of a transformation.

There are several techniques to uncover the capabilities that a business requires. Any of them will try to combine the business stakeholders’ views in a holistic picture.

For a digital business sake, as discussed in my first post, we want to start from the intended customer experience and make it our baseline.

By The Open Group.png

The relevant customer journeys – tailored to customer personas – represent the main value stream which is the backbone of the whole story.

Along with the customer’s perspective, we will align the relevant value streams of the other stakeholders, including their pursued goals.

Then we will analyze them and uncover the capabilities that enable each stage of the value streams and their respective relationships (e.g. information exchanges).

Capabilities will be mapped to organization and then we will identify respective enablers such as technology, application, process, information, skills.

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Business Architecture builds the overall picture and connects the dots in a logical a traceable framework, generating blueprints that represent the current state, future state and possible intermediate steps of a transformation. In this way we can find answers to our business questions.

O-BA describes a typical transformation lifecycle providing a framework for two dimensions of traceability: vertical (from strategy to competitive assessment to investment to implementation and outcomes) and horizontal (across different domains of the organization/ecosystem).

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While O-BA is meant to be the overarching framework for a transformation, technology, data and application architectures complete the view according to TOGAF®, an Open Group standard.

By The Open Group.png

Diagrams like the one reported below show the overall transformation and traceability across business objectives (customer’s being on top), capabilities and their interconnections allowing to achieve the objectives, metrics that audit capabilities, applications and relevant investments enabling the desired capabilities. In a closed loop, business architecture provides a framework to control the return on investment from a complex transformation.

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More details on this example are given in the linked whitepaper produced by Huawei and published by The Open Group: https://www2.opengroup.org/ogsys/catalog/W166

The O-BA is an initiative in the Architecture Forum of The Open Group, driven by six Platinum Members (Capgemini, Hewlett Packard Enterprise, Huawei, IBM, Oracle, Philips) It intends to standardize a common understanding of Business Architecture, reflecting the best practices in the industry (most notably with a contribution by the Business Architecture Guild).

Members of The Open Group can download this presentation at http://www.opengroup.org/public/member/proceedings/Shanghai-2016-08/Presentations/Giovanni%20Traverso-Keynote4.pdf

The Open Group Shanghai 2016 event proceedings are available for members here.

@theopengroup

by-the-open-group

Giovanni Traverso
• 28 years in telecom business, Product Management, R&D Management, Business Unit GM and Transformation Management
• Now leading the Enterprise Architecture team at Huawei Global Services, Standard and Industry Development Dept.
• Certified Business Architect (CBA)
• Contributor to The Open Group Open Business Architecture (O-BA) Standard and the Business Architecture Body of Knowledge (BizBOK)

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Digital Transformation and Business Architecture (Part 2 of 3) – Presented by Dr. Giovanni Traverso, Huawei

At The Open Group Shanghai 2016 summit, we invited Dr. Giovanni Traverso, Chief Business Architect of HUAWEI Service Strategy and Architecture Practice, to give a keynote speech “New Open Business Architecture (O-BA) to Support the Construction of Digital Business and Smart Government”.

Huawei was a Diamond Sponsor of this summit, is a Platinum Member of The Open Group and is participating in the creation of the O-BA standard, whose first part was launched in July 2016 as a Preliminary Standard.

Giovanni, who is leading this effort within Huawei, presented Huawei’s perspectives on Business Architecture coming from best practices.

This is part two in a three-part series.

Part 2 – Business Architecture Enables the Digital Transformation

 

So how to approach such complexity of changes without losing sight of the business intents? How to answer the business questions about investment, risk and assurance, responsibilities, relationships, impacts?

In order to answer our business questions we need a discipline that identifies the components of a business and their relationship. Components and their relationships define architecture, so here comes the “Business Architecture”.

Digital business requires the Business Architecture practice to be open and agile. Open means that it should look beyond our organization’s boundaries, be centered on customer experience and projected towards its industry ecosystem, besides internal focus. Agile means that it should decompose the business into loosely coupled and highly cohesive components, so that the architecture is modular and changes can follow business opportunities incrementally, quickly, limiting risks and mastering dependencies.

The O-BA standard, reflecting industry’s best practices, fulfills these requirements being based on Value Streams and Capabilities.

Capabilities represent the modular components of a business, while Value Streams represent the value creation mechanism that delivers value to the business stakeholders, enabled by those Capabilities. On a macroscopic level the whole thing determines the organization’s unique characteristics that in the O-BA are called “competences”.

How do we apply Business Architecture?

In my previous post, we discussed how digital transformation regards Experience / Operations / ICT Infrastructure. This implies that changes have to happen consistently on three fields: Offering (products/services own and in partnership), Business Practice (processes, skills, organization, information), ICT.

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According to this view, technology evolution sustains capability increments, which sustain product and services evolution along with the interactions with ecosystem and customers (determining the customer experience).

This structure unleashes digital business innovation.

In a top-down way, a new business model can be decomposed into required capabilities that will be developed, pulling-in certain technologies.

In a bottom-up way, technology evolution can enable/automate new capabilities that will be made available for business. So we have a bidirectional channel that connects and catalyzes innovation however it is originated.

On the other hand, this structure fits with agile delivery.

The digital ICT branch of an organization can build microservices (reflecting a shared capability map) exposed through APIs, while the Lines of Business (or partners) can rapidly consume them creating service chains that realize a business service or automate some process.

For example, a digital service operator can leverage geo-location technology (already built-in) to create an analytic app that, combined with other existing capabilities, allows to send customized ads to users, generating quickly incremental revenues at marginal cost.

Building upon existing capabilities that are well identified allows to generate new services dynamically “on-demand”, thus enabling the business to set the pace, as opposite to traditional monolithic ICT constructions.

Modern business architecture, based on capability maps, is essential to guarantee coordination so that the benefits of DevOps techniques and the API economy can be applied at scale. That is, without losing sight of the business sense and priorities because capabilities are defined by the business, shared in business language, translated systematically into application, information, technology, process, organization and skills.

Members of The Open Group can download this presentation at http://www.opengroup.org/public/member/proceedings/Shanghai-2016-08/Presentations/Giovanni%20Traverso-Keynote4.pdf

The Open Group Shanghai 2016 event proceedings are available for members here.

@theopengroup

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Giovanni Traverso
• 28 years in telecom business, Product Management, R&D Management, Business Unit GM and Transformation Management
• Now leading the Enterprise Architecture team at Huawei Global Services, Standard and Industry Development Dept.
• Certified Business Architect (CBA)
• Contributor to The Open Group Open Business Architecture (O-BA) Standard and the Business Architecture Body of Knowledge (BizBOK)

 

 

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Filed under Business Architecture, Digital Transformation, Open Business Architecture (O-BA), The Open Group, The Open Group China, Uncategorized

The Open Group Open Process Automation™ Forum

Recently, a new Forum commenced operation in The Open Group, the Open Process Automation™ Forum. This new Forum is focused on developing a standards-based, open, secure, interoperable process control architecture.

The first Members Meeting of the Forum was held in San Francisco, CA, November 16-17, 2016. The industry turnout for this initial meeting was impressive with 57 individuals from 30 different organizations attending.

Forum membership (as of December 7, 2016) includes the following companies:

ABB Fujitsu nxtControl
Accenture
Aramco Services Georgia-Pacific Praxair
ARC Advisory Group Process Systems Enterprise
Aspen Technology Hewlett-Packard Enterprise
ATE Enterprises Honeywell International, Inc. Radix
Huawei RealIRM
BASF Relcom
IBM RTI
Cirrus Link Solutions Inductive Automation
Cisco Intel Schneider Electric
Conexiam Invista Shell
Curtiss-Wright Siemens
Koch Industries
Dow Chemical TATA
Lockheed Martin
Emerson Process Yokogawa Electric Corporation
Ernst & Young Merck & Co.
ExxonMobil MITRE
Mocana

 

A bit of history about this initiative:

ExxonMobil has been describing the need for a new standards effort in the process control automation area for several years. In early 2016, having seen how a similar Open Group standards effort transformed the avionics industry, ExxonMobil approached The Open Group to potentially initiate a new open standards activity. From March to September 2016, ExxonMobil and staff of The Open Group worked to build a “coalition of the willing” comprising end-users in the process control-using industries, and their key suppliers. During this time, several public outreach meetings were held including face-to-face meetings and webcasts to build interest and identify early participants. As the incubation work proceeded, it became clear that there was interest from at least seven different industry sectors who use similar systems from the same community of suppliers in their process manufacturing environments:

  • Food and Beverage
  • Mining and Metals
  • Oil and Gas
  • Petrochemical
  • Pharmaceutical
  • Pulp and Paper
  • Utilities

During the first Members Meeting, a few things quickly became very clear:

  • There are common pain points spanning multiple sectors, such as aging control systems and the need for more rapid technology insertion, which the proposed standards effort can address to the benefit of customers,
  • There are common pain points shared by suppliers in current business models,
  • The supplier community is eager to work collaboratively on an open standard for process control, and,
  • The participants had a common understanding that a “win-win” outcome providing benefits to end users and suppliers is essential, and the members of the Forum are keen to deliver on this.

During the meeting, the scope of the standards effort was discussed, the Forum organization was created, and interim leadership roles were identified for the Forum and for specific work groups. Interim co-chairs for the Forum will be Don Bartusiak of ExxonMobil and Trevor Cusworth of Schneider Electric. The Business work group described a number of specific sub-groups in the areas of outreach, business guide development and certification. An Enterprise Architecture work group was formed, as was a Technical workgroup. The Technical workgroup conducted a pain points brainstorming exercise that will be useful in shaping and defining the technical standard. In addition, the Forum is working on a standards landscape document, which will survey other standards for possible incorporation into the “standard of standards” that we expect to create. Outreach and engagement with other standards organizations is currently being discussed and planned.

A great deal of progress was made in a short period of time, and the members are eager to move forward quickly with development of the technical standard, marketing and outreach activities, and consideration of a certification program. During the meeting, it was also clear that the proposed standard could be transformational in a way that is positive for all industry participants. The word “renaissance” was used (and embraced by the participants) to describe the potential impact of this standards effort on the industry at large.

Launch events are being planned to coincide with The Open Group San Francisco 2017, January 30 – February 2 and the ARC Industry Forum meeting in Orlando, February 6-9, 2017.

Last but not least, we encourage customer organizations, suppliers, academics, systems integrators, and others who want to help influence the direction of the standards development to become members and get directly involved. Details on how to join may be found here.

For those who want to track the progress of this initiative, we have established an open LinkedIn group for the Forum, and will use this to communicate upcoming events and ongoing progress. To follow, join and/or invite others who may be interested, please click here.

The website for the Open Process Automation Forum is accessible here.

Presentation about automation to improve reliability and productivity

http://www.opengroup.org

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Digital Transformation and Business Architecture (Part 1 of 3) – Presented by Dr. Giovanni Traverso, Huawei

At The Open Group Shanghai 2016 summit, we invited Dr. Giovanni Traverso, Chief Business Architect of HUAWEI Service Strategy and Architecture Practice, to give a keynote speech “New Open Business Architecture (O-BA) to Support the Construction of Digital Business and Smart Government”.

This is part one in a three-part series.

Part 1 – The Digital Transformation Challenges

Huawei was a Diamond Sponsor of this summit, is a Platinum Member of The Open Group and is participating in the creation of the O-BA standard, whose first part was launched in July 2016 as a Preliminary Standard.

Giovanni, who is leading this effort within Huawei, presented Huawei’s perspectives on Business Architecture coming from best practices.

The O-BA standard focuses on transformation as a discipline to support business decision-making and bridge business and ICT. It does so on one hand, by aligning all aspects and actors of a transformation with business vision and goals while, on the other hand, answering the business questions regarding structural investments, especially in ICT.

Giovanni’s speech introduced the O-BA standard and illustrated how it can serve governments and businesses striving to become “digital”.

First, we should characterize what is digital transformation is about. According to Huawei practice, digital business entails three constituents driving (left to right) and enabling (right to left) each other: experience, operations and (ICT) infrastructure. Each one of these involves its own challenges that have to be addressed holistically.

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Experience is the ultimate front-end between a digital business and its users, customers, partners, employees. Digital businesses deliver experience to them through products, services and their combination, individually or as part of an ecosystem. In order to help focus, Huawei has encoded the key principles of experience as “ROADS” (Real-time, On-demand, All-online, DIY, Social).

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For example, customers of digital service providers typically will learn about new services through their social network, will want to be empowered to subscribe and consume their services in real-time when they need it, typically through app or portal.

Operation had been revolutionized by digital disruptors in terms of agility, personalization, innovation speed. Thanks to digital technologies, operations are going to be automated, simplified, precisely informed, promptly reactive and even predictive. The new mode of operations is open and collaborative, goes by fast cycles delivering incremental functionality, which allows for adaptive “fail-fast” approach with limited risk.

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For example, Amazon makes a production change every 11 seconds, Google deploys over 2 billion containers each week, Netflix launched simultaneously in 131 countries (source: state of DevOps report 2015).

ICT Infrastructure is consistently pushed to become open, resilient, self-healing, scalable.

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Business Architecture coordinates all these evolutions, ensuring that investments will actually deliver the desired business outcome. Beyond decision-making, Business Architecture can also facilitate the actual execution of the new agile service delivery model. We will discuss this in the next post.

Members of The Open Group can download this presentation at http://www.opengroup.org/public/member/proceedings/Shanghai-2016-08/Presentations/Giovanni%20Traverso-Keynote4.pdf

The Open Group Shanghai 2016 event proceedings are available for members here.

@theopengroup

by-the-open-group

Giovanni Traverso
• 28 years in telecom business, Product Management, R&D Management, Business Unit GM and Transformation Management
• Now leading the Enterprise Architecture team at Huawei Global Services, Standard and Industry Development Dept.
• Certified Business Architect (CBA)
• Contributor to The Open Group Open Business Architecture (O-BA) Standard and the Business Architecture Body of Knowledge (BizBOK)

 

 

 

 

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Filed under Business Architecture, Huawei, O-BA Standard, Open Business Architecture (O-BA), Standards, The Open Group, The Open Group China, Uncategorized