Organization_Options_for_Business_Analysis

Organization Options for Business Analysis Draft Version 1.0 Prepared by: Robert Sheesley March, 2005 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Introduction This paper is focused on the discipline of Business Analysis at ABC Company. Part A will identify some of the key issues resulting from the current approaches for executing Business Analysis and the supporting organization structure. Part B will explore options to resolve these issues that take full advantage of already existing resources needed to support a new alignment. For the purposes of this paper, Business Analysis, broadly defined, includes the following activities: • Executing Business Planning o Support of the corporate vision and strategy development (including development of the overall business model and customer value proposition) o Definition of goals and objectives o Definition/scoping of business initiatives o Financial modeling o Roadmap (investment portfolio) development • Defining and Utilizing Business Architecture o Development of Business Architecture models (e.g. business processes) o Definition of business needs (e.g. business requirements and business rules) o Evaluation of Business Architecture for operational improvement opportunities and solution alternatives o Engagement in solution development (at an appropriate level to maintain business ownership and involvement) Business Analysis is not just about executing projects; it is about understanding the business and facilitating the right business decisions. Business Planning and Business Architecture t gether are required in order to set and carry out the o strategic direction of the organization; so it is therefore critical to be aware of and understand how they are designed to work in conjunction with one another. Although recent improvements in approaches and methods have begun to gain momentum, the current organizational structure at ABC Company is not conducive to effective Business Analysis. The options presented in this white paper are designed to resolve this problem. 2 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Part A: Current State of Business Analysis A Historical Perspective The evolution of Business Analysis and the Business Analyst Role Business analysis at ABC Company began as a business-driven practice that was tightly aligned with the business areas, and focused directly on addressing business need. With the introduction of systems technology, the majority of business analysts came to reside in an area known as Service and Systems (S&S). At that time, the S&S structure was effective for dealing with a more simplified technology environment and an IT department that was much smaller than today. However, as technology solutions changed more dramatically during the late 80’s and early 90’s, the decision was made to shift the majority of business analysts from S&S into the Systems department. This brought about numerous benefits, including more rigorous analysis for IT solution development, increased clarity of the business analyst role and more formalized training. This move also led to benefits from bringing increased business knowledge and expertise into the Systems environment. Unfortunately, removing Business Analysts from the business areas caused atrophy in overall business skills and analysis techniques, particularly within business areas where business analysts were moved to Systems. Time-tested and emerging concepts such as N Present Value, Return on Investment, et Business Architecture, Business Requirements, Business Rules and Business Process Management were absent from our collective expertise and ways of thinking. Without resources within the business focused on these topics, they could not be explored, developed and institutionalized into business practice. The Resurgence of Business Analysis Practices Over the past few years, ABC Company has begun to establish business ownership of business analysis, and has increased focus and rigor around Business Planning and Business Architecture. Planning practices such as Portfolio Management and Roadmap development have focused on ensuring that the highest priority needs of the business are addressed, while driving resource and capital investment for IT solution expenditure. The development of a formal business case and cost-benefit analysis is also positively influenc ing prioritization and funding decisions. Furthermore the recent moves toward portfolio-based budgeting of IT hours and resources are another step toward achieving better alignment of business strategy and IT. In addition to Business Planning, Business Architecture is gaining momentum and is becoming recognized as a key enabling practice to aid business strategy and planning. Business areas are beginning to take ownership for the definition and management of their Business Processes, Business Rules, Business Requirements, and information needs. 3 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Current Organization Structure Supporting Business Analysis Today, the activity of Business Analysis is performed in a number of different places across the ABC Company Corporate organization. This complexity in the structure creates inefficiencies in practices, confusion about accountability, redundant roles across business areas and Systems, and overall redundancy in business analysis. A significant number of Business Analysts reside in Systems, conducting both Business Analysis (as defined here) and project support activities. Within the business areas there are also Business Analysts, including the 22 named Business Architects (each representing their business area). Enterprise Business Analysis There are a number of departments or virtual organizations of resources executing Business Analysis: • BTIO Business Architecture exists to assist with setting enterprise direction for Business Architecture, engaging with business area efforts and guiding the development of Business Architecture within business initiatives. Planning & Analysis helps to coordinate the ABC Company Strategic and Operating Planning Processes; in particular, Planning & Analysis provides financial modeling support to business areas. Strategic Resources provides a number of research-related and analysis services on behalf of the business, including market and consumer research, product analyses and knowledge management services. There are a number of additional areas of business analysis and virtual organizations, among which are the named Business Architects (22, each representing their business area) and individuals trained in Human Performance Improvement (HPI). • • • Business Analysis Work in Systems In Systems, there are 925 internal business analysts spread across the various Systems’ functions, with an additional unknown number of external resources performing a Business Analyst role. Within Systems: • • An average of 6.5 Business Analysts are assigned to each Systems project. The percent of time logged by Systems Business Analysts to projects across all project work in 2004 was roughly 8.4 percent of the overall project hours expended. This equates to over 145 Business Analyst FTEs against the approximately 3.5 million hours of business strategic work in Systems. Significant Business Analysis also occurs within Systems, but outside of project work; this can include effort by Systems Project Development (SPD) resources as well as Service BAs, or resources focused on modeling and analysis (e.g. Business Modeling Services, and the • 4 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Requirements Modelers); there is some redundancy across these efforts and with business areas, but the extent to which these Business Analysis activities occur is currently unknown. Business Area Ad Hoc Organization of Business Analysis Lacking enterprise direction—and in many cases, business area funding—a number of business areas have begun to take steps to organize their resources to better execute business analysis. In some cases, this has involved refocusing existing business resources, and in others has required supplementing with Systems resources “on loan” to business areas. Some of the various ways that areas have organized Business Analyst work include: • • Maintaining Business Analysts within the business department itself (e.g. P&C Claims, Human Resources) Utilizing Business Analysts split between Systems and Business, with the majority residing in Systems (e.g. P&C Underwriting, P&C Actuary, Agency) Using only Business Analysts residing in Systems (e.g. Marketing, Legal, Finance, and other general department support organizations) • Specifically, a number of different models have emerged to support Business Architecture efforts: • A formalized Business Architecture and Business Requirements team, organized at the Product Line/Department level (e.g. P&C Actuary, Bank Requirements Team) A formalized Business Architecture and Business Requirements team, organized at the Business Portfolio level (e.g. Agency, the emerging Financial Services model) Formalized roles within the team (i.e. a sub-team) specializing in an element of Business Architecture (e.g. the Business Rules Management team in P&C Claims) Semi-permanent, virtual and team co-location approaches with Systems Business Analyst resources (e.g. PAS, Enterprise Apps, New Jersey I2, and ERP/PeopleSoft). • • • The following Diagram illustrates the currently disaggregated Business Analysis capabilities within the organization. 5 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Business Areas Business Analysis Alignment Current State P&C Business Portfolio Actuary/ Underwriting Claims Financial Services Business Portfolio Agency Business Portfolio Enterprise Business Portfolio General Departments Business Portfolio Business Portfolio Support Enterprise Svcs. Communications Creative Services Learning & Dev. Marketing Ad Services Finance Legal HR Strategic Resources Legend: Business Strategy BE F C G (limited) (limited) E B F CG (limited) E B F C G B E F C G (limited) Mutual Funds Underwriting Life/Health Agency Actuary Claims Bank Strategic Research (e.g. Customer, A Market, etc.) B Definition of Goals & Objectives C Vision And Strategy Development Business Planning D Business Planning (SOP, CBA, etc.) E Definition/Scoping of Initiatives F Financial Modeling G Roadmap Development Business Architecture H I J Business Architecture Development Business Needs Definition Business Engagement in Solution Development Management of Enterprise Business K Architecture Frameworks & Models Business Architecture Training & L Education Management of Frameworks for EIS A ~30 A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J Planning & Analysis B E H (limited across departments) I (limited across departments) J (limited across departments) D F ~14 BTIO Business Architecture H I L J K 6+2 Solution Development Creation of Solution Specification M (e.g. Project Requirements) Systems Business Analysts I M 925+ Business & Information Systems Systems Enterprise Customer Care Systems Require- H ments M Modelers ~18 Systems Skill Center Area Business Modeling Services (BMS) H 4-6 Department Services P&C Systems Financial Services Systems Data & Information Strategies Systems Technology Primary Issues With the Current State of Business Analysis Increased business ownership of Business Analysis is a positive change, and that increasing rigor around B usiness Planning and Business Architecture practices and techniques is vital to the long-term health of ABC Company. However, the current organization structure, roles and responsibilities, skill sets and processes are driving some critical issues that prohibit realizing the potential benefits. The following are the fundamental issues that continue to constrain planning and execution. Issue #1: Poorly Supported Decision-Making Lacking the resources and without an enterprise mandate, many business areas h ave been unable or unwilling to dedicate sufficient effort towards Business Analysis. This has been driven by insufficient resources and lack of focus on Business Planning and Business Architecture. For example, this feedback typifies some of the business area perspectives: “Our business need is captured in Systems project documentation and we can’t recall it for future efforts.” “Business Architecture and business analysis is a big investment and we just can’t afford to spend the time necessary to drive out depth of analysis.” 6 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Unfortunately, insufficient upfront analysis directly impacts the ability to fully understand business needs, develop and evaluate appropriate options, prioritize work and manage execution. As a result, critical decisions—both within the business and Systems—are compromised. Incomplete business analysis leads to poor decisions in the following areas: • • Idea evaluation (e.g. understanding the merits of potential strategies or aspects of a target vision) Prioritization of business initiatives (e.g. “go/no-go” decisions, as well as which business initiatives should be prioritized based on value to the organization or dependencies with other initiatives) Evaluation of solution options (e.g. whether technology is appropriate, which technologies should be pursued, analysis of buy vs. build, evaluation of vendor offerings and software packages, etc.) “In-flight” project decisions (e.g. whether to modify scope, how to address unforeseen circumstances, revisiting original planning assumptions, etc.) • • There are clear evidences of the negative impacts that lack of good analysis has in these areas. Examples include: uncontrollable project scope, large multi-year efforts that cannot be segmented into smaller work packages, frequently extended project timelines and final project costs that far exceed original estimates. While they are not the only contributing factors, poor Business Planning and incomplete Business Architecture are major drivers of these outcomes. Issue #2: Lack of Business Ownership & Accountability Today, the business does not always sufficiently own Business Analysis. Too often, there is reliance upon Systems (or another solution developer) to drive, or “own,” the true business needs; this includes owning the business problems to be addressed and the ultimate outcomes and effectiveness of solutions (whether or not the solutions are technology-related). While in some cases the business has taken increased accountability of solution development, the resources needed to support this ownership change have not been available . Many business areas continue to rely heavily on Systems resources for business activities, including developing business cases, writing business requirements, determining business information needs and even d efining business process. Naturally, this frustrates the ability of the business to assume full ownership of resolving business issues and meeting business needs. Feedback from the business areas highlights this issue: “System’s has all the money and all the people.” “You are shifting work back to the business without budget or people.” “Who owns Business Requirements' Is it Systems BusinessAnalysts or Business-side Business Analysts'” “Who is going to pay for my consultants to help me do this work'” 7 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Creating Business Portfolios to manage Sequence work is an important step in the right direction; however, there is still a major gap in aligning ownership and accountability for Business Analysis and, in particular, Business Architecture. Issue #3: Insufficient Alignment Across Business Areas and Between the Business and IT The business of Insurance and Financial Services has been subjected to rapid market changes and technology has become highly complex and diverse. As a result, Business Analysis at ABC Company has become diffused across the organization and more specialized; many BAs have developed a narrow focus in either a particular area of knowledge, or a particular technique or method. Additionally, coordination across business areas is extremely difficult without utilizing Business Architecture. This all increases the overall complexity of the environment and exacerbates the already difficult task of creating alignment. Today, business areas are neither aligned in a common direction nor synchronized in their understanding of common needs and solutions. Additionally there is a gap in the ability to align technology solution delivery with the strategy of the business (this is an issue that is not unique to ABC Company). These alignment issues are having the following effects: • There is a general inability to tie initiatives or project work back to overall strategy and business need. This leads to the ultimate unanswered question of “Are we focusing on the right work to address our business need'” Definition of solutions and the perspective of the complete business are not aligned; therefore, decisions are made from the perspective of sustaining a single project, rather than to optimize the whole business portfolio Changing business needs (e.g. driven by market or environmental change) creates a disconnect with solutions; neither the business nor Systems is able to determine how the solutions should be impacted. A “vertical” project focus misses the “horizontal” perspective across projects and business areas, so there is little awareness of how activity in one area may have correlation to or benefit for another area; this leads to redundant spending and duplication of processes and services. • • • The impacts of insufficient alignment are being felt. For example , multiple projects coming into Sequencing are each addressing the same exact business needs, business areas are having difficulty building operational and technology roadmaps , it is difficult to identify redundancies or overlaps across enterprise solutions (i.e. ILCs), and dependencies across business areas and/or solutions are not clearly understood. The following feedback and questions underscore the extent of the issue: 8 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. “We found out during sequencing that two other business cases were trying to deliver on the same business need.” (business to business alignment) “How do we identify the redundancies that exist in projects'” (business to business alignment) “We didn’t find out about “their” needs until we got into design.” (business to IT alignment) “Why do we create a business case and then determine our needs'” (business to IT alignment) “Business and IT convergence is usually limited to functional specifications handovers, or project-based virtual team working.” (business to IT alignment) Issue #4: Resistance to New Approaches for Business Analysis Quality Business Planning and the development of Business Architecture directly impact the success of project execution. However, there is still resistance to fully embracing these disciplines. While it i somewhat natural for individuals to resist any change, there are s two key additional contributing factors. First, decision-makers do not see clear enough enterprise-wide commitment, and will continue to operate independently until they do, as evidenced by the following feedback: “This architecture work is a lot of overhead and it won’t sustain itself.” “If I don’t need to get my work sequenced, I’ll just do a service request.” “I’m not going to do this [Business Architecture] until somebody makes me do it.” Second, decision-makers do not believe they have the time, money and resources. However, failing to invest in up-front Business Analysis often (if not always) ends up costing more time and money. Examples include: extended time in the SRA phase trying to uncover business needs; project “false starts”; project scope creep; the i ability to redirect or terminate n projects that cease to prove their ROI; end solutions that do not sufficiently meet business needs. Implications for Not Addressing These Issues Without instilling greater discipline and capabilities for the execution of business-owned Business Analysis, these issues will continue to worsen: • • • • Business Portfolio leads will struggle to understand business needs. It will be difficult to prioritize investments and create meaningful plans and roadmaps. Emerging approaches and best practices for Business Analysis will lose their positive momentum. The benefits of Business architecture will be lost. 9 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. • Individual project efforts will continue to ‘re-invent the wheel,’ spending money time and again on the same work. This need not be the case for ABC Company. Supporting good Business Analysis can improve decision-making, re-instill business ownership and accountability, create alignment across business areas and with solution development, and improve project execution. Grass roots efforts to date have shown that this can be done; now it is the time to provide the resource and organization support required to achieve the long-term benefits. Part B: Options for Re-Organizing Business Analysis The importance of a top-down, business-driven strategy that is supported by rigorous Business Planning and Business Architecture cannot be underestimated if ABC Company is to sustain its competitive position in the marketplace. Business Analysis can no longer be performed once-a-year in support of building business cases or executed only as part of project execution; rather, it must become a continuous, ongoing practice that supports good business decision making. In order to accomplish this objective, a shift in the structure of the organization is required. The total number of people across both IT and business is not the problem. The total amount of money budgeted within the enterprise is also not the problem. There are both the capital and human resources necessary to achieve this cultural change. The problem lies within the allocation of financial and human resources. Three options have been explored for re-alignment of the resources in order to directly address the current state issues surrounding Business Analysis at ABC Company. What they all share is bringing together Business Analysis capabilities from both the business and Systems (depicted below). “Business Areas” Strategic Analysis, Business Planning, Operations Support “Systems” Business Architecture (Approx 10%) Solution Design, Solution Specification, etc. (Approx 90%) Business Architecture [ Today ] Business Analysts 10% Business Analysts Systems Analysts [ Tomorrow ] Business Analysts Bus. Arch. BAs Systems Business Analysts Solution Design, Solution Specification, etc. Systems Analysts Strategic Analysis, Business Planning, Operations Support Business Architecture 10 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Additionally , several key organizing principles shape all three options : • Business analysis should be moved closer to business area strategy and direction-setting; this applies to both Business Planning as well as Business Architecture. The new organization should foster knowledge-sharing, the leverage of expertise and collaboration among the business areas and with Systems. Wherever possible, redundant work and re-work should be eliminated. • • Option 1: Business Analysis Resource Sharing This option maintains the alignment of Business Architects to Product Lines or Departments. A number of Business Analysts from Systems will be aligned in similar fashion, and will be “loaned” to the business for specific assignments or work efforts. This arrangement means that they will remain Systems employees, but work exclusively on their assigned work effort. The following are the key elements of Option 1: • • • • Business Analysis are aligned to individual Product Lines or departments The resources from Systems and their budget remains officially in Systems Systems BAs co-locate with the business (not just the Business Analysts, but Subject Matter Experts, etc. as well) Centralized competency centers establish enterprise frameworks, and play a strong role in developing coordination across business areas Business Area Business Analysts remain aligned with their current departments Systems Business Analysts remain in Systems, but are “loaned” to the business, and co-locate with the business for participation in Business Analysis (both within proje ct efforts and prior to project initiation) BTIO Business Architecture stays roughly the same size, with emphasis on developing enterprise methods/frameworks, coordinating business areas, providing training and education, and conducting enterprise-level analysis Business Modeling Services (or BMS, who currently support modeling efforts while managing some of the modeling frameworks, such as process mapping and context diagramming) remains in Systems, but works more directly with business areas, including significant work prior to initiation of projects Requirements Modelers (who currently work within Systems project efforts to create models and define solution needs) remain in Systems, but become more educated in Business Architecture practices and techniques; they too work both within projects and on work prior to project initiation Option 1 implications for existing groups : • • • • • 11 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Business Areas Option 1: P&C Business Portfolio Actuary/ Underwriting Claims Business Department Alignment Legend: Business Strategy A Strategic Research (e.g. Customer, Market, etc.) B Definition of Goals & Objectives C Vision And Strategy Development Business Planning D Business Planning (SOP, CBA, etc E Definition/Scoping of Initiatives F Financial Modeling G Roadmap Development Business Architecture H I J Business Architecture Development Management of Frameworks for Financial Services Business Portfolio Agency Business Portfolio Enterprise Business Portfolio General Departments Business Portfolio Business Portfolio Support Enterprise Svcs. Communications Creative Services Learning & Dev. Marketing Ad Services Finance Legal HR Strategic Resources BE F C G (limited) (limited) E B F CG (limited) E B F C G B E F C G (limited) Mutual Funds Underwriting Life/Health Actuary Agency Claims Bank EIS A ~30 A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J A B C E F G H I J Planning & Analysis B E H I J D F ~14 BTIO Business Architecture Business Needs Definition Business Engagement in Solution Development Management of Enterprise Business K Architecture Frameworks & Models Business Architecture Training & L Education H I L J K 6+2 ~80 “loaned”/co-located to Product Lines/Departments Systems Business Analysts Solution Development M Creation of Solution Specification (e.g. Project Requirements) I M 925+ Business & Information Systems Systems Enterprise Customer Care Systems Require- H ments M Modelers ~18 Systems Skill Center Area Business Modeling Services (BMS) H 4-6 Department Services P&C Systems Financial Services Systems Data & Information Strategies Systems Technology Option 1: Pros • Improves coordination between business and Systems resources (versus today) • Increases resources dedicated to Business Planning and Business Architecture development (versus today) • Minimizes immediate impact to the organization • Focuses BAs on a specific line of business or department, instilling higher subject matter knowledge Option 1: Cons • Requires a greater number of overall Business Analysts (due to ineffic ient utilization of resources assigned to product lines/ departments) • Doesn’t fully address the current Systems mindset toward Business Analysis, given that the resources still reside in the Systems department • Results in a more difficult job of coordinating across business areas • Provides the least amount of enterprise control and standardization (requiring significant effort in order to coordinate by building influence) • Doesn’t effectively align with Solution Centers in Systems 12 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Option 2: Portfolio Alignment of Business Analysis This option aggregates Business Analysts at the Business Portfolio level. Similar to Option 1, a number of Business Analysts from Systems will be aligned with the BAs from the business, but in contrast to Option 1, these resources will actually move out of Systems and into the business (along with their associated resource budget). A small number of the analysts from Systems will align to the enterprise organization (e.g. BTIO Business Architecture), but most will align directly to Business Portfolios. The following are key elements of Option 2: • • • Business Analysis resources align to the Business Portfolios Systems BAs that are part of the alignment (along with their HR budget) move to the Portfolio to be managed directly by the business Centralized competency centers establish enterprise frameworks, methods and governance, as well as drive enterprise analysis The allocation of resources to each Business Portfolio would likely be based on the percentage of hours allocated to the Portfolio. This reallocation would result in a zero net change for the organization (no more dollars/hours would be allocated to an effort than would have been prior to the cost-shifting). Option 2 implications for existing groups: • • Business Area Business Analysts re-align to Business Portfolios; in many cases this will involve a new reporting structure. Systems Business Analysts will be moved from Systems to the business (this organizational transition includes approximately 10 percent of Systems Business Analysts; those working on true Business Analysis). BTIO Business Architecture will grow modestly , absorbing a small number of resources transitioned from Systems; the primary emphasis is on developing enterprise methods/frameworks, coordinating business areas, providing training and education, and conducting enterprise-level analysis. Business Modeling Services (BMS) is moved out of Systems; resources are either aligned to business portfolios or absorbed into BTIO Business Architecture. Requirements Modelers are split; most remain in Systems, focused on solution specification and design (i.e. translating the requirements of the business into solution definition); a small number are moved into the business. • • • 13 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Business Areas Option 2: P&C Business Portfolio Actuary/ Underwriting Claims Business Portfolio Alignment Legend: Business Strategy Financial Services Business Portfolio Agency Business Portfolio Enterprise Business Portfolio General Departments Business Portfolio Business Portfolio Support Strategic Resources A E H B F I C G J Underwriting A E H B F I CG J A E H B F I C G J Mutual Funds Life/Health A E H B F I CG J A E H B F I CG J H I G J Enterprise Svcs. Communications Creative Services Learning & Dev. Marketing Ad Services Finance Legal HR A Market, etc.) B Definition of Goals & Objectives C Vision And Strategy Development Business Planning Management of Frameworks for Strategic Research (e.g. Customer, Actuary Agency Claims Bank EIS A ~30 D Business Planning (SOP, CBA, etc E Definition/Scoping of Initiatives F Financial Modeling G Roadmap Development Business Architecture H Business Architecture Development I Business Needs Definition J Development Business Engagement in Solution Planning & Analysis B C E B C E B C E B C E B C E B C E (dept. level) B E E (dept. level) D F ~14 E BTIO Business Architecture K Management of Enterprise Business Architecture Frameworks & Models L Business Architecture Training & Education Solution Development M (e.g. Project Requirements) Creation of Solution Specification Capability that has been removed from the area Systems Business Analysts H I L J K ~8-10 ~80 Allocated to Business Portfolios I M ~850+ Business & Information Systems Systems Enterprise Customer Care Require- H ments M Modelers ~15 Systems Skill Center Area 3-5 allocated to BTIO Systems Business Modeling Services (BMS) H 0 Department Services P&C Systems Financial Services Systems Data & Information Strategies Systems Technology Option 2: Pros • Helps remove redundancy across efforts • Optimizes alignment of business analysis to strategic decision-making (i.e. Business portfolio planning) • Drives accountability vertically, as well as horizontally; portfolios will have to communicate and integrate their priorities in order to align with the priorities of the Chairman’s Council • Gains some economies by aggregating at Portfolio level (increasing efficiency of spend on business analysis and execution) • Can be done without a net gain of resources to the organization • Emphasizes building business analysis expertise, while not losing touch with the business (i.e. strikes good balance) 14 Option 2: Cons • Requires a formal shift in resources and budget dollars from Systems to Business Areas • Requires new management of resources at a Business Portfolio level ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Option 3: Enterprise Alignment of Business Analysis This option aggregates Business Analysts at the enterprise level. Resources drawn from both the business areas and Systems will comprise this enterprise capability. As in Option 2, aligning resources will involve shifting both the resources to the enterprise business group along with associated budgets. The following are the key elements of Option 3: • Business Analysis is consolidated into a single function with focus across the enterprise (note: this could be a single function for all Business Analysis, or two enterprise functions, one for Business Planning and the other for Business Architecture). Resources and associated budgets are shifted to the enterprise function. The centralized pool of Bus iness Analysts is dynamically assigned to work efforts across the organization. The focus of enterprise resources is Business Analysis and modeling expertise; Business Analysts work closely with Subject Matter Experts and operations BAs within business areas. Business Area Business Analysts (focused on Business Analysis work) are aligned into the centralized enterprise competency center; operationally-focused Business Analysts and Subject Matter Experts remain alig ned to business areas. Systems Business Analysts will be moved from Systems to the business (approximately 10 percent of Systems Business Analysts, those working on true Business Analysis). BTIO Business Architecture evolves into the enterprise Business Architecture organization, absorbing existing BTIO Business Architecture resources, business area Business Analysts and Systems Business Analysts transitioned to the business; the primary emphases are on driving Business Analysis for all business areas, developing enterprise methods/frameworks and models, executing enterprise analyses, coordinating and prioritizing across business areas. Business Modeling Services (BMS) is moved out of Systems; resources are aligned to the enterprise Business Architecture organization. Requirements Modelers are split; most remain in Systems, focused on solution specification and design (i.e. translating the requirements of the business into solution definition); a small number are moved into the business, joining the enterprise Business Architecture organization. • • • Option 3 implications for existing groups: • • • • • 15 ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Business Areas Option 3: P&C Business Portfolio Actuary/ Underwriting Claims Enterprise Alignment Legend: Business Strategy A Strategic Research (e.g. Customer, Market, etc.) B Definition of Goals & Objectives C Vision And Strategy Development Business Planning D Business Planning (SOP, CBA, etc E Definition/Scoping of Initiatives F Financial Modeling G Roadmap Development Business Architecture H I J Business Architecture Development Management of Frameworks for Financial Services Business Portfolio Agency Business Portfolio Enterprise Business Portfolio General Departments Business Portfolio Business Portfolio Support Strategic Resources A E B F C G Underwriting A E B F CG A E B F C G Mutual Funds Life/Health A E B F CG A E B F CG G Enterprise Svcs. Communications Creative Services Learning & Dev. Marketing Ad Services Finance Legal HR Actuary Agency Claims Bank EIS A ~30 Planning & Analysis B C E B C E B C E B C E B C E B C E E (dept. level) B E (dept. level) D F ~14 BTIO Business Architecture E Business Needs Definition Business Engagement in Solution Development Management of Enterprise Business K Architecture Frameworks & Models Business Architecture Training & L Education H I J K TBD Solution Development M Creation of Solution Specification (e.g. Project Requirements) Systems Business Analysts I M ~850+ Business & Information Systems Systems Enterprise Customer Care Systems Capability that has been removed from the area Require- H ments M Modelers ~15 Systems Skill Center Area Business Modeling Services (BMS) H 0 Department Services P&C Systems Financial Services Systems Data & Information Strategies Systems Technology Option 3: Pros • Optimizes the utilization of expertise and skilled resources; provides the best leverage of expert resources • Drives truly enterprise analysis (“enterprise-driven” architecture); facilitates enterprise-wide prioritization and allocation • Most easily coordinates business areas and identifies commonality and opportunities for sharing and reuse • Best facilitates creation and dissemination of standard models, approaches and best practices • Provides opportunity to address the gap between corporate and the zones (lets corporate reestablish relevance and value) • Yields highest control over business practices 16 Option 3: Cons • Moves Business Analysts further from Business Area strategy development and planning • Diminishes focus on developing business area Subject Matter Expertise ABC Company Business Analysis DRAFT. For Discussion Purposes Only. Summary The following highlights some of the key distinctions among the options: 1 Option 1: “Resource Sharing” 2 Option 2: “Portfolio Alignment” 3 Option 3: “Enterprise Alignment” “Business Areas” Strategic Analysis, Business Planning, Operations Support Business Architecture Business Architecture (Approx 10%) “Systems” Solution Design, Solution Specification, etc. (Approx 90%) [ Today ] Business Analysts 10% Business Analysts Systems Analysts Technical Analysts 1 Systems BAs “loaned” to virtual Business Architecture group; budget and staff remain in Systems 2 Systems BAs are moved into the business along with their budget (and optionally management) 3 Systems BAs are moved into the business along with their budget (and optionally management) “Business Areas” “Systems” [ Tomorrow ] Business Analysts Bus. Arch. BAs Systems Business Analysts Solution Design, Solution Specification, etc. Systems Analysts Technical Analysts Strategic Analysis, Business Planning, Operations Support Business Architecture 1 Business Architects aligned to Product Lines/Departments 2 Business Architects aligned to Business Portfolios 3 Business Architects part of an enterprise group The focus of Business Analysis needs to change; business needs and customer needs have to be rooted in the strategy of the enterprise and have to more effectively drive solution development. Changing the culture, the organization structure and the allocation of funds will reduce the churn that occurs as business and Systems attempt to follow processes for human and capital resource expenditures. It will not be without pain, but the dollar savings for the enterprise is enormous and will grow exponentially as the right resources are grown and business architecture is built within each department. 17