Business Architecture (BA) reflects the organisation of the enterprise. It consists like any architecture, of nodes in interconnections which for the enterprise are the business functions and the connections which enable the business flows. In practice, BA denotes the blueprint of the enterprise.
A single page diagram, illustrating the core enterprise business functions and flows, is key for stakeholders to understand the enterprise and align their points of view. Nevertheless, to develop the full Business Architecture, each and every function and flow in the single page diagram has to be further expanded and documented so that the BA is able to support in sufficient detail the needs of each and every stakeholder. An Enterprise Model (EM) consists of the Business Architecture (BA) (i.e. the business logic of the enterprise) and the Technology Architecture and People Organisation which implement and execute the business logic.
The author prefers to use the term “Enterprise Modelling” because too often today “Enterprise Architecture” is confined to IT. Still, when employed in this paper, the term Enterprise Architecture (EA) refers to whole enterprise including Organisation and non-IT technology rather than IT alone.
Also, instead of the term “Business Model (which for the business academia denotes today the specific way an enterprise is organised to return value/profit) the term Business Architecture is preferred.
Why business architecture?
Business Architecture enables the understanding, improvement and further development of the Enterprise. It is the most important layer of an Enterprise Model (EM) because it shapes the technology and people resources that implement it.
Of particular importance is the single page Business Architecture diagram that constitutes the big picture of the enterprise. Without this top level business architecture, stakeholders and architects would keep reinventing the Enterprise components and business flows in each and every discussion and solution project.
Porter’s Value Chain of an Enterprise
At the beginning of the 80s, Michael Porter suggested that any Enterprise consists of two categories of activities:
Primary activities, which are organised in a sequence of activities called Value Chain, consist in the operational processes that deliver the product, such as Inbound Logistics, Operations, Outbound Logistics, Sales, and Services.
Support activities that are all other activities, as, for example, Human Resources, New Capabilities and Product Development, Procurement that support the Value Chain activities.
The GODS extended Value Chain structure
Taking into account the fast pace of change today, the enterprise Development and Governance activities were classified as separate categories in Porter’s Value Chain since they ensure today the competitive edge and survival of the Enterprise. This is how the GODS Enterprise structure came into being. GODS stands for: Governance, Operations, Development and Support. The GODS generic business architecture model is as such an extension of Porter’s Value Chain concept.
Hence, the generic GODS Business Architecture model illustrates the Value Chain and the critical support functions of any enterprise:
The enterprise generic enterprise flows
Thus, essentially, the Operations Value Chain consists of:
Market Research and Planning
Production and Distribution
Sales and Servicing
Hence the generic one page GODS business architecture model for any enterprise, consisting of the main business Functions, Value Chain and Flows is illustrated below:
The GODS One Page Generic Business Architecture
Any Enterprise has to:
research the market to understand the customers segments and demand.
forecast and plan the production according to market predictions.
create demand for products by advertising/marketing the products.
manufacture the products.
sell and deliver the products.
accrue the revenue.
provide after-sales services.
The GODS single page generic Business Architecture diagram expands the GODS Value Chain to illustrate:
Governance functions such as the CEO Office, Legal, Public and Government relations, Corporate Social Responsibility…
Operations Market research and Planning, SCOR functions from Supply Chain to Production and Distribution, and Sales and Services
Development functions such as New Product and Capability Development, R&D…
Support activities such as HR, Finance, IT… which are a constant indeed in most enterprises
Key generic business flows
The Planning Flow that begins with the market research followed by forecasting; this Flow plans all Operational, Development, and Support cycles.
The Demand Creation Flow stimulates the market through various channels.
The Production Flow from Supply to Distribution, (SCOR: Supply Chain Operations Reference) delivers the Products.
The Demand Flow or Sales and Ordering is the process through which the customers obtain the products.
The Revenue Flow charges the customers at sales and orders, invoices and bills them and accrues revenue.
The After Sales/Servicing Flow charges the customers at sales and orders, invoices and bills them and accrues revenue.
A box in the diagram represents a Function, i.e. all activities and information of a certain type.
Flows are illustrated with arrows and boxes/Functions. A Flow is implemented by one or more Functions and interconnections. Business Flows could have been called Value Streams, processes, workflows, or Value Chains, but these terminologies were deliberately avoided since they come from different business domains with various baggage and different meanings.
A function in the diagram is implemented by people and/or technology/IT part of the overall Enterprise Architecture.
Enterprise stakeholders, beside customers and partners/suppliers, government… are not illustrated in the picture to avoid cluttering. Still, the enterprise interacts with such external stakeholders as the labour and capital markets to acquire resources and is affected by regulators and competitors.
GODS and the generic one page Business Architecture are free to use and change for own purpose with attribution under a Share Alike Creative Commons licence.