Enterprise Architecture Enabling Process Governance For Agility, Compliance And More

Dr. Mathias Kirchmer, Managing Director and Co-CEO,BPM-D Affiliated Faculty, Program for Organizational Dynamics, University of Pennsylvania
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Dr. Mathias Kirchmer, Managing Director and Co-CEO,BPM-D Affiliated Faculty, Program for Organizational Dynamics, University of Pennsylvania

Dr. Mathias Kirchmer, Managing Director and Co-CEO,BPM-D Affiliated Faculty, Program for Organizational Dynamics, University of Pennsylvania

Agility and Compliance are Key Success Factors

Organizations must continuously adjust to a changing market environment with new or modified client requirements. Customers demand more and more individualized products and services – fast and at a reasonable price. Only highly agile companies can successfully compete in such an environment. In addition, organizations must internally comply with more and more legal requirements and company standards. In industries such as financials, healthcare, pharmaceuticals or energy, the management of compliance with permanently changing laws and regulations is becoming a key challenge. While enterprise-wide agility and compliance are not the only values a successful business needs to deliver, this value-pair has become a key success factor for most companies. Agile technologies, such as intelligent automation or robotic process automation (RPA), only provide appropriate results if they are managed accordingly. Same is true for compliance and standardization solutions.

Process Governance for Agility and Compliance

Business processes structure an organization into end-to-end value streams with an external starting event at the beginning and a result of value for a customer at the end. Each process has to deliver the appropriate level of agility and compliance. There may be processes where mainly agility counts, for example, when it comes to client negotiations and discussions. In other processes, for example in the finance area, compliance aspects dominate, making agility and related creativity less required. Hence, processes and supporting applications have to be managed towards the appropriate level of agility and compliance. This requires ownership of such business processes and the necessary empowerment to make things happen. This means that the right process governance must be in place.

  Enterprise Architecture is a well-defined approach to create the transparency for conducting analysis, design, planning, and implementation, using a comprehensive approach at all times, for the successful development and execution of strategy   

Governance in general relates to procedures and decisions that seek to define actions, grant power and verify performance. Process governance enables the value-driven management of end-to-end business processes, supported by an overall “process of process management”. A process owner decides based on the performance of the processes when improvements are necessary, initiates the right projects and controls the success so that business processes deliver the results required by an organization’s strategy. This means, this person is responsible for the definition and achievement of the required agility and compliance. Both values need to be defined in the context of the specific process and operationalized through key performance indicators (KPI). The agility of the “order-to-delivery” process of a home improvement store, for example, could be measured through the delivery cycle time. However, this would lead to a situation where the bathroom equipment could be delivered much earlier than needed – which could cause significant challenges for the client. The more appropriate KPI would be the delivery variance around the target date. Once the KPIs are defined, the process owner needs the appropriate information about the process itself to control it and launch corrective actions when necessary. This is where enterprise architecture (EA) comes into the picture.

Enterprise Architecture enables Effective Process Governance

EA is a well-defined approach to create the transparency for conducting analysis, design, planning, and implementation, using a comprehensive approach at all times, for the successful development and execution of strategy. This means EA can deliver information for the entire enterprise, but also for individual business processes. An important usage scenario of a value-driven EA is the support of process governance. EA delivers the necessary information about a process in the appropriate structure, the right quality using the best-suited tools necessary to enable process governance for agility and compliance – and possibly other values.

EA enables process governance through the information based on a suitable architecture framework, such as the Architecture of Integrated Information Systems (ARIS), answering the following questions about a business process relevant to manage agility and compliance:

What are the expected deliverables of the process, why do I need it? What’s the right degree of agility and compliance and how do I measure it (“deliverable view”)?

Who (people, departments, enterprises, etc.) is involved in the process and with that engaged in necessary improvement activities (“organization view”)?

What functions are carried out within the process to understand if those functions should be changed, eliminated, or completed to achieve agility and compliance goals (“function view”)?

What data is needed or produced in the process as basis for the management of agility and compliance (“data view”)?

How do all those aspects fit together, that means who is doing what by means of which data to produce which deliverables and in which logical sequence are the functions carried out as basis to identify relevant workflow changes (“control view”)? Who is involved in agility and compliance relevant functions and what’s the related data used?

What technology supports the different “views” as basis to identify digital and other technology requirements (“system view”).

The combination of the answers to these questions allows the process governance organization, especially the process owner, to identify the right actions and launch the appropriate improvement initiatives to achieve and maintain the appropriate agility and compliance.

Enterprise Architecture and Process Governance as part of a Process Management Discipline

This interaction between EA and process governance, the prioritization and execution of resulting projects as well as the use of appropriate methods, approaches, and technologies is organized through the discipline of process management. This is the overall management discipline, which transfers strategy into people, and technology based execution – fast and at minimal risk. EA, governance and other related processes are part of the overarching process of process management, implementing the process management discipline. This discipline can then be used in a basic version to support the realization of agility and compliance, but it can also be extended to support more goals an organization’s strategy requires through continual use of the powerful combination of EA and process governance.

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