Enterprise architects can assume various roles in driving innovation within their organizations. There is a growing demand for an architectural perspective on innovation, particularly as large organizations have become increasingly complex. In such environments, innovation can be challenging due to coordinating numerous moving parts, often without a clear overview. This is where enterprise architecture can deliver significant value, providing the strategic insights and structure needed to navigate and manage complexity effectively.
We see three key roles for architects in innovation:
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Most established organizations have grown organically over the years, adding departments, functions and systems piecemeal without thinking about the larger impact of these additions.
Moreover, even if there was a sound and mature architecture practice involved in the evolution of the enterprise, the architectural choices of the past may no longer be adequate in the present days, especially as the enterprise is trying to move forward into the future. For example, a common architecture principle is “reuse before buy before build”: rather than creating something new, we need to reuse what we already have because duplication of functionality is needlessly expensive, leads to data inconsistencies, et cetera. Makes sense, right? Well, maybe not always.
Applying this principle has often led to large, centralized systems that try to be everything to everyone. Those systems usually started out small. Then, a new requirement that was perhaps covered for 80% by that system but required 20% new functionality. It is much better to extend the existing system a little than to buy something else, right? Let’s just switch on this extra module from the vendor, or add another table to the database. However, every extension becomes gradually more complicated since you must consider the impact on the entire system.
So we need to do away with these monoliths. Let’s introduce service orientation and do everything with microservices: Fine-grained, lightweight, loosely-coupled functional elements with clear, standards-based interconnections. Let’s also organize our agile ‘two pizza’ teams around those services and have them innovate locally. That will make life much easier. Well, maybe not always…
All too often, microservice landscapes devolve into a similarly complicated mess of dependencies, connecting everything to everything else. Formerly, this mess may have been hidden inside the belly of your big legacy system. We can now see it more clearly, which is undoubtedly progress, but change becomes progressively more difficult because of all the interdependencies we have introduced.
Moreover, ensuring data consistency across such a web of services is no easy task. Performance may become an issue because of the network communication between all these services. And if every team is free to choose their technology stack (as some agile proponents want to have it), you can imagine the resulting complexity and risk for the enterprise. Finally, how do you know that what these individual teams have decided contributes to desirable business outcomes for the enterprise?
Once you consider these aspects, it becomes evident that solid architecture is as relevant as ever if you want to innovate and keep innovating. Classical principles around coupling and cohesion of systems still apply. From their ‘big picture’ perspective, architects can help decide where to integrate or separate the parts of your business and IT landscape. From a business level downwards, thinking about autonomous business capabilities helps you partition your architecture in independently evolving and innovating parts. Approaches like pace layering let you understand and guide the different speeds of change in the various parts of your landscape.
Concepts like the above not only help in reducing complexity and thereby enhancing flexibility and agility, but also in explicitly shaping space for innovation. Where could you create room for exploration and uncover potential business value, without introducing undue operational or financial risk? And there is much more in the toolbox of the architect that helps their organizations foster innovation and change. We believe that smart, enterprise-wide insights and collaboration support successful corporate innovation efforts. For example:
You need to realize, though, that the days of ‘big design up-front’ are over. Enterprise architects can no longer design a fixed target state far into the future. The world around us just changes too fast and our stakeholders’ needs change accordingly. Rather, by providing just-enough, just-in-time decisions and guidance through ‘intentional architecture’, architects can help organizations stay flexible and innovative.
The lifespan of today’s big enterprises continues to decline. As a result, large private and public organizations spend billions of dollars annually on innovation to become invincible. Numerous brainstorm sessions, hackathons, shark tanks and substantial capital investments in start-ups still embody today’s search for the next big thing. When it comes to investing in new ventures, very few investments generate an ROI of 10x or greater multiple. This means that for large organizations, innovation becomes a volume game. While a lot of effort and creativity is put into ideation (generating and collecting innovative ideas), we believe coordinating the lifecycle of a creative idea is an equally indispensable part of the innovation puzzle that organizations face.
Design thinking techniques have proven valuable in increasing the odds for innovation success. Successfully bringing new products and services to market requires organizations to invest in testing the desirability (do customers want it?), feasibility (can we build it?), and viability (does it make financial sense?) of new ideas. However, despite their high potential, many innovative ideas never make the expected return on investment. Why?
When it concerns existing organizations (excluding startups), scaling innovations is a daunting challenge in the 21st century. Business strategy, products and services, digital technologies, and fluid organization structures and networks, have become advanced ecosystems that are not always easy to change.
Next, we recommend our customers think about three practical areas of improvement when it comes to achieving a (more) successful innovation practice, resulting in more successfully implemented business innovations. In all these areas, architects are uniquely positioned to add business value with their knowledge of the organization’s strategy and (complex) structures, increasing the ROI of many innovation efforts.
Make sure your organization doesn’t invest in homeless ideas. Actively score ideas and innovation projects (that often live in innovation funnels managed by innovation teams) based on the business strategy. Following the timeless advice of Mintzberg and Waters, we’d advise our customers to combine deliberate strategic change (top-down approach to ensure strategic value and look around corners) with emergent strategic change (bottom-up approach to collect ideas from employees). Creating Strategic Idea Portfolios together with innovation teams based on strategic goals can be a great start.
Use Business Capability Maps that are related to the innovation ideas captured in your organization’s idea portfolios (or: libraries). Work with the owners of these ideas to construct a business view of the proposed innovations. This will enable the creation of innovation insights at a business level, for example by mapping the organization’s strategic goals on business capabilities and comparing that against the number of ideas for that specific business domain. Another effect of doing this is that it will put the architects (and also the internal strategy/management consultants) in a position to advise on suitable ambidextrous organization structures to make a new venture work, as many large organizations are simply not wired to scale innovation and create breakthrough growth.
Let’s say that a business line in your organization is working on a great innovation project that will bring a new product to market. The first testing results for this business idea are promising, as customer feedback is very positive. To test for feasibility (can we build it?), architects can estimate the complexity of such an initiative. This results in an Innovation Portfolio Analysis, indicating the current (estimated) desirability and feasibility for each innovation effort, combined with an idea of the effort (e.g., in project budget or time) needed to implement the innovation. This will provide decision-makers in innovation processes (e.g., CxOs, Innovation Leaders, Portfolio Managers) with a clear risk profile for each ongoing innovation effort to decide whether to start, stop or continue.
Innovating Innovation: it’s the architect’s turn!
When successful, architects can provide executives, innovation leaders and innovation teams with smart insights that support better innovation decisions. We believe there is an opportunity for architects to innovate innovation.
(Teams of) architects have pretty unique and deep business & IT knowledge, and with their ‘horizontal’, broad perspective, they can see the opportunities and impact of trends where others focus more on the deep but narrow details. In our first installment in this series, we argued that architects can help their enterprises become more innovative by shaping space for innovation, spotting trends, and analyzing their opportunities and impact. Our second post discussed the role of architects in ensuring a coordinated innovation approach, focused on the potential business value of innovation. Together, this gives you room for and a grip on innovation.
Fight the “shiny object syndrome” and become a true innovation champion.
In many organizations, we see people run after the latest shiny bauble. You know how it is: some manager says, “IoT is hot, we need to do something with that,” and people start running. Real business impact, however, requires deep insights into not just the (often technological) innovation itself but, first and foremost, into its potential business benefits (and risks!). This requires a combination of knowledge of both an enterprise’s business and IT, something that architects are uniquely positioned to offer.
The next step is to proactively engage with management in initiating innovation based on these insights and unlocking the true value of these innovations. This way, architects can become a trusted adviser of management on innovation.
In our previous blog, we showed how you can manage a portfolio of innovations based on feasibility, desirability, strategic fit, and adaptability, using architecture-based analyses to score ideas along these axes. You need a balanced portfolio of low-risk, low-return and high-risk, high-return innovations: tweaking existing processes just a bit in order to squeeze out the last drop of efficiency is not enough, but aiming exclusively for ‘loonshots’ and ignoring day-to-day improvements isn’t a good idea either. Based on the evaluations we mentioned, architects can trigger the right innovations at the right time. With their broad overview of existing and planned developments in the organization, they can initiate innovations that fit the business context and are well-timed, for example, to piggyback on other changes or to take advantage of short-term market opportunities.
Finally, architects can play a key role in innovating the innovation processes in organizations. Successful innovation and change is not confined to some department of experts in an ivory tower. Instead, it requires collaboration between many roles within the enterprise, engaging and convincing all manner of employees and other stakeholders, and bringing together bottom-up, top-down, and lateral ideas. Again, architects, with their broad knowledge and contacts in the organization, can play a key role in facilitating this.
Moreover, you cannot manage innovation using whiteboards, sticky notes, and beer mats alone, especially not in larger organizations with inputs from numerous angles and many moving parts that need to be coordinated. Successful innovation requires the proper support: a shared space for innovation management. This requires an enterprise architecture tool that brings together the contributions of individuals and teams from across and beyond the enterprise to reinforce each other.
Managing Consultant & Chief Technology Evangelist at Bizzdesign
Marc contributes to Bizzdesign’s vision, market development, consulting, and coaching on digital business design and enterprise architecture. He also spread the word about the Open Group’s ArchiMate® standard for enterprise architecture modeling, which he has been managing the development of. His expertise and interests range from enterprise and IT architecture to business process management.
Product and Innovation Manager
Matthijs Scholten is responsible for Bizzdesign’s innovation portfolio, product vision, and product roadmap. Leveraging his consulting experience in complex business transformation projects and his passion for people, design, and technology, Matthijs puts his creativity into innovating Bizzdesign’s leading enterprise SaaS platform.
