Business Ecology Initiative & Service-Oriented Solution

Michael Poulin

Business Organization for Dealing with Clouds

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I could not omit Hollis Tibbetts' BLOG "Cloud should be "top down", SaaS "bottom up"? Huh?" because it reflects on the idea of Cloud adoption top to bottom.

It is not clear, however, from this BLOG or from the referred article of David Linchicum who is responsible at the top for making a corporate strategy for adopting Clouds, and SaaS particularly. Yes, as Hollis says, "Anybody with $25 to spend and 15 free minutes can create another new data silo for their corporation". Moreover, we hear more and more frequently that this "Anybody" is a Business Unit (BU) and the decision is made within the Line of Business and without considering IT involvement. Following Hollis, "Central IT (as a general category) has failed us here - and for the most part are still way behind the curve."

So, we are getting into a situation where an enterprise business agrees with decentralised IT capabilities owned by different BU. This business, probably, does not understand yet that separated SaaS solutions will need an integration sooner or later and this will cost additional money but there are no principle objections on this extra cost.

An acceptance of this overall picture illuminates the major mindset shift in an enterprise concept and organisation. From our previous experience, we know that if there would not be something with more power than just a corporate policy of control over Cloud engagement, i.e. something that would enforce his policy, the company with such Cloud-exposed BUs is looking for troubles of disbalance, efforts and product duplication, waste of resources and the inability to operate as a single unit in the market. We were in a similar situation about 20 years go already but with different vendors than Cloud ones.

In the book "Architects Know What Managers Don't" I offer the solution for these problems - both the split of IT and centralised coordinating mechanism that kerbs selfish BUs and preserves integral corporate interests other any others. However, the principal difference from the nowadays situation is in that in my model there are no hierarchical administrative structures in the enterprise and the IT resources are distributed not per product or geographic locations. Instead, the book describes a four-part organisational model of an enterprise based on functional Business Architecture.

The model includes: a C-executive level, a Cross-Functional Cross-Divisional Management Unit (CFCDMU), a family of semi-independent BUs, each of which provides certain business function or service, and a realm of compositions of business functions/services that may form enterprise products and/or services, external and internal. Each BU (representing a Business Service) manages its on IT resource while there are shared IT resources under the supervision of the CFCDMU [Business Architecture and Enterprise Technical Architecture belong to the CFCDMU]. Regardless how much or little money a BU has earned, the CFCDMU controls all resources to be spent on the transformation of the functional landscape of the company in transition to the strategic goals. Details of the Business Architecture that such organisation implements are described in the book.




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In this blog, Michael Poulin writes about business and technology ideas, concepts, methodologies and solutions leading to service-oriented enterprise, the primary instrument for obtaining business objectives in fast-changing environments.

Michael Poulin

Michael Poulin is an enterprise-level solution architect working in the financial industry in the U.K. and the United States.

He specializes in building bridges between business needs and technology capabilities with emphasis on business and technical efficiency, scalability, robustness and manageability. He writes about service orientation, application security and use of modern technologies for solving business problems. He contributes to OASIS SOA standards as an independent member and is listed in the the international "Who's Who of Information Technology" for 2001. View more

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