Business Reference Model

Business Reference Model

Business architecture is a fairly budding new area within the architecture job family. In the past decade the practice of business architecture is one than has found a place into most practices, but when analyzed in more depth, we find that the focus and boundaries of the each practice differed greatly. this was the impetus for TOGAF (The Open Group Architecture Framework) to create a reference model for business architecture. The architecture is fairly comprehensive as an industry agnostic model. While this is comprehensive, is the reference model something that can be put into action within an organization?

Some of the key aspects of the model include not only the business areas and their abstractions but also the information flow, which is what is highlighted in the figure below. This reference points out that the environmental factors meet the compliance and regulatory in 3 distinct areas.

One being the Value proposition. The environment and compliance create tensions within the Value proposition affecting the products, services, branding and shareholder value. The balance between these is articulated in the diagram fairly accurately.

 

Another alignment between the environmental factors and compliance converges in Risk. Risk related functions include Financial, Operational, Strategic and Control. This orthogonal cut of the business model affects the aforementioned areas in a critical way. As the business fails to meet it’s consumers needs and/or regulators, risk increases and mitigation strategies (controls) should be in place to isolate the operational impacts. 

 

Finally the last convergence takes form in affecting the operational footprint of the business. This is where a companies core competencies are baked and the business is managed. Again if the Compliance and/or Environmental factors are not met the model describes an ecosystem that becomes disrupted at it’s core. One thing that this model doesn’t seem to take into account is the reciprocal nature of the relationships. As the core is disrupted, the Value Proposition and the Risk areas are also proportionately affected. 

 

Aside from the tactical approach of the model in it’s current form, the model can be extended to include more focused content and augmented to align with any business (at least semantically). The need for something like this, it helps to drive key delighters such as stability, resiliency and agility into a complex business, although the value is most likely lost on a small business. Meeting these overarching goals are analogous to Maslow’s pyramid. If the core things cannot be met, the high value work cannot be accomplished. 

 

[1] TOGAF, 2014, Whitepaper, http://cdn.ey.com/digital-playbook/pdf/Business-Reference-Model.pdf