Enterprise

Enterprise Architecture (EA)

(wiki)

Definition

• Rigorous description of the structure of an enterprise, which comprises
  • composition of enterprise components (business entities),
  • externally visible properties of those components
  • relationships (e.g. the behavior) between them.
  • terminology
  • relationships with the external environment
  • guiding principles for the
    • requirement (analysis)
    • design
    • evolution of an enterprise.
  • enterprise goals
  • business process
  • roles, organizational structures, organizational behaviors
  • business information
  • software applications and computer systems.
• Practitioners of EA or "enterprise architects."
  • Are people responsible for developing the enterprise architecture and is often called upon to draw conclusions from it.
  • By producing an enterprise architecture, architects are providing a tool for identifying opportunities to improve the enterprise, in a manner that more effectively and efficiently pursues its purpose
• Collection of Artifacts represent the EA.
• The UK National Computing Centre EA best practice guidance[5] states
  • An EA takes the form of a comprehensive set of cohesive models that describe the structure and functions of an enterprise.
  • The individual models in an EA are arranged in a logical manner that provides an ever-increasing level of detail about the enterprise: its objectives and goals; its processes and organization; its systems and data; the technology used and any other relevant spheres of interest
  • "architectural vision": a description of the business that represents a "target" or "future state" goal.
    • "transitional architectures": a set of intermediate steps are created that illustrate the process of changing from the present situation to the target.

Scope and Method

• The scope of an enterprise architecture
  • Public or Private Sector organizations
  • An entire business or corporation
  • A part of a larger enterprise (such as a business unit)
  • A conglomerate of several organizations, such as a joint venture or partnership
  • A multiply outsourced business operation
• Methods of Enterprise architects
  • What do they do?
    • business methods
    • analytical techniques
    • conceptual tools
  • Why?
    • to understand and document the structure and dynamics of an enterprise by producing artifacts: lists, drawings, documents and models
    • To describe the logical organization of
      • business functions
      • business capabilities
      • business processes
      • people organization
      • information resources
      • business systems
      • software applications
      • computing capabilities
      • information exchange and communications infrastructure within the enterprise.

Frameworks, Areas of practice (and Domains)

• An enterprise architecture framework bundles tools, techniques, artifact descriptions, process models, reference models and guidance used by architects in the production of enterprise-specific architectural description.
• Why Divide into Domains?
  • allows enterprise architects to describe an enterprise from a number of important perspectives.
  • encourages the contributions of many individuals and allows the practice as a whole to make good use of individual domain-specific expertise and knowledge.
  • enterprise architects can ensure a holistic description is produced.

Spewak's Enterprise Architectural Practice (EAP)

• Level 1: EA
• Level 2
  • Domain: Business Modelling
  • Domain: Current Systems and Technology
• Level 3
  • subordinate domain: Data Architecture
  • Applications Architecture
  • Technology Architecture".
• Level 4
  • "Implementation" or "Methods" level, which deals with "how" to migrate the Enterprise to match the new model.[7]

The Open Group Architectural Framework TOGAF

• Business Architecture
• Information Systems Architecture
  • Information Architecture
  • Applications Architecture
• Technology Architecture

The Strategic Architecture Model

• Flexible division into up to ten domains covering many aspects of an enterprise from its objectives and goals through its projects and programmes to its software applications and technology.[9]

The popular Model

• Business:
  • Strategy maps, goals, corporate policies, Operating Model
  • Functional decompositions (e.g. IDEF0, SADT), business capabilities and organizational models expressed as enterprise / line of business architecture
  • Business processes, Workflow and Rules that articulate the assigned authorities, responsibilities and policies
  • Organization cycles, periods and timing
  • Suppliers of hardware, software, and services
• Information:
  • Information architecture - a holistic view on the flow of information in an enterprise
  • Data Architecture- describes the way data will be processed, stored , data flows and used by the projects teams that will use it
  • Master Data Management, is the authoritative, reliable foundation for data used across many applications and business processes with the goal to provide a single view of the truth no matter where the data is located
  • Metadata - data that describes your enterprise data elements
  • Business Intelligence Analytics & Reporting BI (Business Intelligence) is a broad category of applications and technologies for gathering, storing, analyzing, and providing access to data to help the organization users make better business decisions.
    • Activities of decision support systems, query and reporting, dashboards , scorecards ,statistical analysis, forecasting, and data mining.
    • Reporting Data Stores ( Operational Data Store (ODS), Datamart and DataWarehouses)
  • Data Quality helps identify, analyze, improve, and measure the data quality and data integrity issues and improvement efforts
  • Data models: conceptual expressed as enterprise information architectures, logical, and physical
  • Data Life Cycle Management Processes to govern how to create, classify, update, use, distribute, and archive, and obsolete data and information
• Applications:
  • Application software inventories and diagrams, expressed as conceptual / functional or system enterprise / line of business architectures
  • Interfaces between applications - that is: events, messages
• Technology:
  • Inter-application mediating software or 'middleware'.
  • Application execution environments and operating frameworks including applications server environments and operating systems, authentication and authorisation environments, security systems and operating and monitoring systems.
  • Hardware, platforms, and hosting: servers, datacentres and computer rooms
  • Local and wide area networks, Internet connectivity diagrams
  • Intranet, Extranet, Internet, eCommerce, EDI links with parties within and outside of the organization
  • Operating System
  • Infrastructure software: Application servers, DBMS
  • Programming Languages, etc. expressed as enterprise / line of business technology architecture.

Benefits from describing the architecture of an enterprise

• improve the effectiveness or efficiency of the business itself.
• Innovations in the structure of an organization
• centralization or federation of business processes
• the quality and timeliness of business information
• Ensuring that money spent on information technology (IT) can be justified

Relationship to other disciplines

• information technology governance
  • Related process in organizations such as Dubai Customs and AGL Energy who have implemented a formal enterprise architecture process as part of their IT management strategy.
• business optimization Addresses areas such as
  • business architecture
  • performance management
  • process architecture performance engineering
  • IT portfolio management
  • metadata management.
• holistic design practices
  • Design Thinking
  • User Experience Design

Enterprise Resource Planning (ERP)

(Wiki)

• Definition and Characteristics
  • An integrated system that operates in real time without relying on periodic updates.
  • Integrates internal and external management information across an entire organization
  • Automate activities with an integrated software application.
  • Facilitate the flow of information between all business functions inside the boundaries of the organization and manage the connections to outside stakeholders.[1]
  • Using a common database, which supports all applications.
  • A consistent look and feel throughout each module.
  • Installation of the system without elaborate application/data integration by the Information Technology (IT) department

Considerations

• Organizational Processes involved
  • Finance/Accounting:
    • General ledger, payables, cash management, fixed assets, receivables, budgeting, consolidation
  • Human resources
    • payroll, training, benefits, 401K, recruiting, diversity management
  • Manufacturing:
    • Engineering, bill of materials, work orders, scheduling, capacity, workflow management, quality control, cost management, manufacturing process, manufacturing projects, manufacturing flow, activity based costing, product lifecycle management
  • Supply chain management:
    • Order to cash, inventory, order entry, purchasing, product configurator, supply chain planning, supplier scheduling, inspection of goods, claim processing, commissions
  • Project management:
    • Costing, billing, time and expense, performance units, activity management
  • Customer relationship management:
    • Sales and marketing, commissions, service, customer contact, call center support
  • Data services:
    • Various "self–service" interfaces for customers, suppliers and/or employees
  • Access control:
    • Management of user privileges for various processes
• Software Components
  • Transactional database
  • Management portal/dashboard
  • Business intelligence system
  • Customizable reporting
  • External access via technology such as web services
  • Search
  • Document management
  • Messaging/chat/wiki
  • Workflow management
• Benefits with Implementation of Industry Best Practices
  • Reduces time–consuming project tasks such as configuration, documentation, testing and training.
  • Reduces risk by 71% when compared to other software implementations.[11]
  • Eases compliance with requirements such as IFRS, Sarbanes-Oxley, or Basel II.
  • Help comply with de facto industry standards, such as electronic funds transfer. (Procedure can be readily codified within the ERP software and replicated with confidence across multiple businesses who share that business requirement.)
• Modularity Pros and Cons
  • Differentiation: Some modules allow automation, and are common modules used by all (e.g. finance) while some are specific (e.g. HR)
  • the greater the number of modules selected, the greater the integration benefits, but also the greater the costs, risks and changes involved.
• Scope of Systems integrators (bring unique knowledge on process, equipment, and vendor solutions for connectivity to Plant Floor Information)
  • Direct integration—ERP systems connectivity (communications to plant floor equipment) as part of their product offering. Vendors to offer specific support for the plant floor equipment that their customers operate. ERP vendors must be expert in their own products, and connectivity to other vendor products, including competitors.
  • Database integration—ERP systems connect to plant floor data sources through staging tables in a database. Plant floor systems deposit the necessary information into the database. The ERP system reads the information in the table. The benefit of staging is that ERP vendors do not need to master the complexities of equipment integration. Connectivity becomes the responsibility of the systems integrator.
  • Enterprise appliance transaction modules (EATM)—These devices communicate directly with plant floor equipment and with the ERP system via methods supported by the ERP system. EATM can employ a staging table, Web Services, or system–specific program interfaces (APIs). The benefit of an EATM is that it offers an off–the–shelf solution.
  • Custom–integration solutions—Many system integrators offer custom solutions. These systems tend to have the highest level of initial integration cost, and can have a higher long term maintenance and reliability costs. Long term costs can be minimized through careful system testing and thorough documentation. Custom–integrated solutions typically run on workstation or server class computers.
  • Standard protocols—Communications drivers are available for plant floor equipment and separate products have the ability to log data to staging tables. Standards exist within the industry to support interoperability between software products, the most widely known being OPC[13]

Implementation

• Scope
  • Changes to staff work processes and practices.[14]
  • three types of services are available to help implement such changes
    • Consulting
    • Customization
    • support.[14]
  • Implementation time depends on
    • business size,
    • number of modules,
    • customization,
    • the scope of process changes, and the
    • readiness of the customer to take ownership for the project.
  • Modular ERP systems can be implemented in stages. The typical project for a large enterprise consumes about 14 months and requires around 150 consultants.
• Methodology Selection
  • Methodologies
    • Software Development
    • Project Management
    • Organizational Change Management
    • Business Process Management
    • Quality Management
  • Factors for consideration (Article)
    • Size of the implementation
      • Affects Financial perspective (cost) and organizational perspective (users impacted).
    • Personnel Capabilities
      • People on the project team (Business, internal IT, Implementation Partner) have necessary abilities and training to successfully apply a selected methodology to an ERP implementation.
    • Risk
      • Customer experience with ERP implementations? Selection of a methodology within acceptable risk-adverse limits (ex. iterative).
    • Business IT Relationship and Culture
      • Realistic assessment of the relationship between the business and the internal IT organization. (If the relationship does not foster effective collaboration or there is a known alignment challenge then an iterative approach should be considered.)
      • Iterations provide a dramatic increase in feedback over sequential software development, thus providing much broader communication between customers/users, and developers.
    • Business Model Dynamic
      • The more dynamic a business model is the greater opportunity for evolving requirements with methods that are rapid and flexible. Traditional approaches that focus on a reasonable stable set of requirements may not be the best choice.
    • Assumptions for a Methodology
      • As stated earlier every methodology is based upon an “environment”. It is very important that you understand the basis for the methodology as well as determine the assumptions made. Making an objective evaluation of the methodology will determine its advantages, challenges, and assumptions made.
  • Process Preparation
    • linking current processes to the organization's strategy;
    • analyzing the effectiveness of each process;
    • understanding existing automated solutions.[19][20
  • Configuration and Customization
    • Customization is always optional, whereas the software must always be configured before use (e.g., setting up cost/profit center structures, organisational trees, purchase approval rules, etc.)
    • The software was designed to handle various configurations, and behaves predictably in any allowed configuration.
    • The effect of configuration changes on system behavior and performance is predictable and is the responsibility of the ERP vendor. The effect of customization is less predictable, is the customer's responsibility and increases testing activities.
    • Configuration changes survive upgrades to new software versions. Some customizations (e.g. code that uses pre–defined "hooks" that are called before/after
      • displaying data screens) survive upgrades, though they require retesting. Other customizations (e.g. those involving changes to fundamental data structures) are overwritten during upgrades and must be reimplemented.
  • Extensions
    • Establish need for features such as: archiving, reporting and republishing; capturing transactional data, e.g. using scanners, tills or RFID access to specialized data/capabilities, such as syndicated marketing data and associated trend analytics.
  • Data migration
    • Identify the data to be migrated
    • Determine migration timing
    • Generate the data templates
    • Freeze the toolset
    • Decide on migration-related setups
    • Define data archiving policies and procedures.

ERP Solutions Vs Special Purpose Applications

• Advantages
  • ERP integrates myriad processes by which businesses operate saves time and expense. Decisions can be made more quickly and with fewer errors. Data becomes visible across the organization. Tasks that benefit from this integration include[25]:
    • Sales forecasting, which allows inventory optimization
    • Order tracking, from acceptance through fulfillment
    • Revenue tracking, from invoice through cash receipt
    • Matching purchase orders (what was ordered), inventory receipts (what arrived), and costing (what the vendor invoiced)
  • ERP systems centralize business data, bringing the following benefits:
    • Eliminate the need to synchronize changes between multiple systems—consolidation of finance, marketing and sales, human resource, and manufacturing applications
    • Enable standard product naming/coding.
    • Provide a comprehensive enterprise view (no "islands of information"). They make real–time information available to management anywhere, any time to make proper decisions.
    • Protect sensitive data by consolidating multiple security systems into a single structure.[26]
• Disadvantages
  • Customization is problematic.
  • Re–engineering business processes to fit the ERP system may damage competitiveness and/or divert focus from other critical activities
  • ERP can cost more than less integrated and/or less comprehensive solutions.
  • High switching costs increase vendor negotiating power vis a vis support, maintenance and upgrade expenses.
  • Overcoming resistance to sharing sensitive information between departments can divert management attention.
  • Integration of truly independent businesses can create unnecessary dependencies.
  • Extensive training requirements take resources from daily operations.

List of ERP Software Packages

(Wiki)