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BTOES Insights Official
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March 23, 2022

Enterprise Architecture Live - SPEAKER SPOTLIGHT: Utilizing EA and business capability modeling to drive strategy and strategic technology investments

Courtesy of Financial services Company's Sandip Dhummad below is a transcript of his speaking session on 'Utilizing EA and business capability modeling to drive strategy and strategic technology investments' to Build a Thriving Enterprise that took place at Enterprise Architecture Live.

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Session Information:

Utilizing EA and business capability modeling to drive strategy and strategic technology investments

In today's world, where agility & time to market is considered gold for a product; companies requires a holistic digital transformation. Having a consistent, common language between business and technology takes care of 50% of the problem. Business capability map not only help in establishing a common language but also drives a future business vision, technology strategy, roadmap and future technology investments.

  • We always think about investing in applications and infrastructure rather than to investing in capabilities, which cut across silos 
  • Transforming an organization to a capability driven IT organization is way more difficult to implement than it sounds 
  •  Capability-based IT strategy and strategic technology investment helps meet business outcomes. At the same time it helps define a systematic process for defining future/transition state and evaluating various options

Session Transcript:

I do a brief introduction on our first speaker, Sandeep ....

He's an Enterprise Architect with extensive experience leading organizational wide technology transformation initiatives.

Just that first line, I will tell you, he's a member of our tribe.

Just eat deep in the process, defining target state, enterprise, architect your vision, understanding business requirements plans, and converting them to strategic roadmaps for technology organizations.

He has worked across a wide variety of different portions of this space, including leading, leading groups of thought leadership, people together to exchange those fantastic ideas, these, to find an executed enterprise wide IT strategies, programs and roadmaps like Cloud, API, DevOps, et cetera.

So as you can imagine, he's proud member of our tribe.

He's a developer evangelist, led multiple communities of practice, and it does workshops and consulting in his own organization and around the world. So without further ado, I'd like to introduce Sandeep ....

Thanks, Chris, nice to be on this conference.

I would like to start with the, with a question, you know, there are, how many companies would be there in the world.

Hundreds. Thousands.

Hundreds of thousands, million.

You know, there is a large number of companies out there, All these companies, they are basically working striving for one goal, and their one goal is to be successful.

What drives the success of these companies is starting with an excellent reason, great strategy, great fitness model.

Great education, and last but not less, the great team of people.

But, you know, what drives or what powers all of these great things is the Capability modeling.

Now you might be wondering, you know, how is that possible?

Let us take an example, No, black batty CEO.

He told that, you know, we did nothing wrong but you know, we are business fail.

Why does it fail because they fail to recognize the changing needs of the capabilities. The users where now the introduction of an i-phone users were more interested in getting highly interactive user interface and that those are the capabilities that they need to deliver in, time and desolate cause bear witness to pay.

So with that, you know, today our Be happy to present a topic on utilizing EA and with this capability modeling to drive a Strategy and Strategic Technology investment.

Sandip Dhummad img-1With that, you know, just quick introduction of myself, as Chris talked about on Sunday, Enterprise Architect Cloud Architect.

Here is our brief agenda.

So what we're going to talk about today is basically, we'll start with introduction, what do you witness capability?

What is strategy, how everything works, Then, we will talk about, we will talk about how a business capability modeling can drive strategy and also drive strategic investments.

Let us start with business capability. What is business capability?

Business capability defines.

What is your business for?

Business governability defines what your business is trying to do. What value of your business is trying to add to the people's life?

Now, the one important thing that I would like to mention here is that I used word go up.

Business capability does not mean how it does not mean who the reason why this give a very don't mean how or who, because how do you go about implementing a business strategy?

Or capability that varies from time to time.

And who does that, Who helps you realize that? That also changes all the time?

So, but be the core capabilities or the core things that you as a business offer to your customers, that don't change.

The change in how and who is because of the changing need and changing environment.

Big business.

Now you might be wondering, OK, this capability is all about God.

What is that big? A great thing about Cuba.

Well, the first and foremost, with this capability house, define a common language between business and technology.

Know how much of time that goes behind, defining that common language, so that business and technology starts speaking the same thing, you know, this capability helps there.

It adds, it adds there and it helps avoid any confusions that that happens during the effective, that that happens during the communication. It enables the effective collaboration between business and technology.

There are three types of business capabilities.

The number one is good capabilities.

As the name suggests, they are core code, you have witnessed, these are the capabilities that huh basically provide the value to your customer.

They, respect it most.

Are looking forward for it.

This supplemental capabilities are the capabilities which are built on top of core capabilities.

They are important, but, you know, the India they are good to have.

But core capabilities are the real value that your customers are looking forward from you.

Enabling capabilities are the capabilities, which are foundation for building the core capabilities.

Let me take an example for this.

Know, if you are an investment bank, your core capabilities would be your, how you go about helping your customer to the investment, all their asset and their money, so that they can get more return out of it, that, those are the core capabilities.

This supplemental capabilities in the investment banking is all the applications and the user interfaces that you vary to help your customers get to get to their portfolio and manage their investment portfolio, tojo, supplement, and capabilities.

Btog CTAThe enabling capabilities are the eyeball and a bore applications which are, you know, investment book of Record and Accounting, book of record that that enables or that powers the actual investment activity. So those are the enabling capabilities.

Now, the next thing here is strategy. What is strategy?

Well, you know, there are so many different definitions out there about strategy.

I would say that the simple way of defining strategy is, Strategy is a framework for making decisions, and that's it.

Now, when I say strategy is a framework for making decisions, you know, there are so many people, they get confused with strategy and the planning.

And I'll give you an example, right?

If you talk to somebody, some people who say that my strategy is, I didn't do number X, I'll do X, Then after that, I will do Y And then after that, I'll do the, Well, there are those steps, are not exactly a strategy.

That's your plan plan of executing a strategy that you had decided to go with.

So, there is a difference between strategy and planning.

Now, the question is, you know?

Is that there are only elite group of people? Those who are part of a think-tank, they do a strategic thinking, and we all don't get a chance to do a strategy work.

Well, that's not true.

We think about strategy all the time.

Just to give you an example, right? Again, state strategy is just the framework for making decisions. Like every Thanksgiving, you know, you have this question.

I went to visit my parents and how should I go? Oh, Go in, reject them!

There are different modes of transportation that you can take You can either you drive, you'll fly, or you can take a train ride.

Well, how would you go about deciding that?

Usually what we do is that they think about these things across multiple criteria: one example, you know, the speed at which I want to reach to my destination, the convenience that I want to help during my journey, and the cost of the journey.

And based on these Gradate, yes, you decide that how you want to visit your bags, this is nothing but making a strategic decision. So, we do strategic thinking in our life all the time.

Now, what is business strategy?

So, you know, there's a lot of bad out there on Internet about, you know, what is business strategy?

There are so many different definitions, it will be the godfather of business strategy or the strategy, Michael Order.

What he said is that business strategy is all about going all about defining that differentiating capability.

All about defining the unique activity is a unique proposition that you want to put in for your customer. He did not say that. The strategy is all about being best.

He said that business strategy is all about being different now, you might be surprised or wandering, Why is that? I mean, isn't it as a business to be successful? I have to do the best. I have to have its best business strategy.

Well, the answer is that if you try to be a bask in the thing which is common across, they industry, then you know, you don't have a competitive edge.

That means you are in the constant threat of losing your business, as well as losing your customers, but if you are a unique, if you have those different capabilities that you offer to your customer, your growth can be sustainable for a longer duration of time.

Now, board is not now, you know, it's also important to know what is not a business strategy.

So sometimes people say that you know the best practices or doing a business is my strategy. Well that's not a strategy. Those are best practices.

Sometimes people say that our business strategy is downsizing our witness or restructuring our witness. Those are also not a strategy.

These are basically an action plan that you want to implement for growing your business but your witness strategy should be rewarding the unique differentiating capabilities to your customer.

That should be a good strategy.

Now, let's talk about, you know, probably the EA and the business capability Modeling can help drive the strategy. The strategy that we talk about, right?

The strategy of being successful by being unique.

So let's start with an example.

Here, as you see on the screen, I have a capability modeling.

Define for a financial institution. The name of this financial institution is called ABC Bank.

Now, as any financial institution, this ABC Bank has these core capabilities: They do an investment banking.

They also do a commercial and witness banking, meaning, like, you know, giving loans to the witnesses, and they do a retail banking like providing services, banking services to the individuals like us.

They also provide a wealth management and insurance.

Now, this is fine, That's the level one capability modeling of a financial institution.

In general, what is the goal of a financial institution?

The goal of a financial institution is to provide higher rate of return, then establish bench mark, but better customer service.

To further simplify this, a goal of a financial institution is that, But avoid your, the higher percentage on your investment that you make.

What is the strategy that they use for achieving this goal?

Those are called investment strategy.

So the, the bankers and the brokers which are working for this financial institution, they help implement this investment strategy.

Now, what are those differentiating capabilities that used to be part of the investment strategy traditionally?

Though, traditionally speaking, the Number one differentiating capability used to be a diversification of portfolio.

Now, those who know finance and finance domain, they all know that there is an NPT modern Portfolio Theory. This is the theory that came in in late nineties, early 2000.

Copy of Email Graphic Virtual Conferences (3)And the theory basically talks about that you should not put all your eggs into one basket.

You should diversify your portfolio across multiple, different No, the positions or the different, you know, the investment takers.

And, the second thing that they talk about that, if there are two different investment, they both basically promise you to go give you a higher rate of return. You should choose the one that has the lower risk profile.

And that's the diversification of portfolio.

The second differentiating capabilities of these financial institutions was that solid current research and analytics because these companies dry on analyzing the financial market data, as well as the financial data of various different companies, and making the right decision on which company that they should be investing for.

Now, the question here is that these differentiating capabilities, are they new? No, they are not new. They are there for a long time.

What does that mean?

That means that every financial institution on a street has mastered in this differentiating capabilities for so many years.

So that means if you want to really make money employing these traditional differentiating capabilities, you have to be really good about it.

And that's why, if you look at our stock market, they say that stockmarket, today's, in today's world, the stock market is highly efficient.

What do they mean by that?

They mean that it's very difficult to make money more than the benchmark.

Like, you know, if S&P Index is earning 70, showing you a 7% rate of return on an average, it's very difficult to make more than 7% rate of return until and unless you have you had really mastered in these differentiating capabilities.

So the question is that, is that sustainable? Maybe not.

So, the next thing, next thing comes into play, is that, what is that investment strategy that Martin, Financial Institute institution should, and Blackboard?

Well, did the modern day, differentiating capabilities, could be using an AI and ML technique for doing robot? Now, you might say that, well, what's the value rotating is going to add? Value, you know, the investors are doing trading doughboys robot, also being training.

Robot trading is not just about replacing and trader with a computer.

It's not about increasing the capacity of or a number of traits that you can do with the stock market by employing more number of computers, embed your number of traders, is all about doing an attribution analytics.

So what these guys do is that they try to look for the pattern that they are highly successful. Traders, generally employ for making more money.

They're trying to emulate the same pattern through these robots so that, in that way, you know, they can tie trying to scale that one very good trader into multiple computers.

That's what the differentiating capabilities.

that can help you make a lot of inverse return on investment.

The other thing is, you know, you can use AI and ML technology, putting continuous risk management.

Usually the risk monitoring and risk management used to be, you know, a daily or, you know, periodically that daily risk management or monitoring, basically cause a lot of complaints in 2008, Lot of losses.

No, there are some companies, they could not manage the risk proper, they, they they went out of business, as we all know.

The second differentiating capabilities that you can employ in today's board is employing an alternate data.

As we all know, that, in the last year, you know, there are some social groups.

What they did was they basically rally the stocks like GameStop, very high number.

They all collaborated through our social media and they all invested. They started making strategic investment into that company to basically, highly impact that stuck.

So, having said that, in today's world, the financial institutions should pay a lot of attention to these kind of, you know, social media, web, analytics data, mobile analytics data, credit card, manual data, all these alternate investment.

You know, there's so many such kind of alternate investment alternate data that's available to the financial institutions today, The companies.

they can make the best use out of this, they, again, succeed better than others in today's world.

The third thing is, most of the people in today's world, they are basically doing a very thorough analysis of the company and making sure that the companies are environmentally and socially responsible.

And these are called sustainable investment and that's why, you know, these days there's a new ESG index that came into picture, people are making investment based on ESG index of a company.

So what I'm trying to say here, is that the business strategy, and also the IT strategy of a company, which isn't usually derived from a business strategy.

They should always look for the accurate differentiating capability, and they should plan their entire IT strategy and the business strategy around these differentiating capabilities.

And those who are really focused on these, and they can be successful in defining the strategy clearly, and implementing them fast enough, they've become successful.

But, the bottom line is that the code behind everything that we talked about is the capability modeling. Being able to model these capabilities, and driving, using that capability for driving your decisions.

Now, the next question is that how can eat healthier?

Well, typically, if you look at the organizational structure.

The engineering team is responsible for building an application.

They are very much involved in their day-to-day task of building the applications and the supporting the applications, the the other people, like, you know, business analysts and the big technology product managers and people like that.

They know witnesses well, because they can interface with witness, and then they can help define some of the business capability.

In the Enterprise Architect, they are in that position. They kind of become allies. And, or the bridge between a witness.

And the technology organization, and they can help define this capability modeling effectively.

So, that it becomes a common language for entire organization, and at the same time, this capability modeling is at the level, that, it can be consumed and being used by the development team. So that they can act on it.

So having said that, the the The biggest advantage, that Enterprise Architect has is that, they have this outside in and inside out view. So they know the market well, They can basically help drive this capability model very well.

On top of that, they can also go further down.

They can help categorize these capabilities into, you know, as we were talking about, core capabilities, which is, like, kind of differentiating, or strategic capabilities, versus supplemental skip over it is an enabler.

And they bet this categorization can really help drive where to do, what kind of investment in your IT roadmap.

They, because it is a technical role, they can also go level, detailed down.

They can, they can define this business capability detailed enough, such that the engineers can consume them. Fun example.

Here, there is one with this capability called trading, that's one of the core capabilities of investment banking.

As we all know, they, they, the way you do the trading, it really depends on the asset class.

So, for example, have you do a training, and what kind of tools and technologies that can you, that you can use for doing a trading for stocks and bonds?

Screenshot (4)Is it different compared to how you do it for the Canadian investments?

So, having said that, the enterprise architects can drive this capability model. So, the capability model that I have on the screen is three level capability model.

They can even take it further down, so that you know, they can even how defined at the application level, re-usable component, and services level, and that will help all the engineering team to visualize that what a business is trying to achieve, and this will drive the IT roadmap significantly.

Now, defining your capability modeling is not enough, As we all know, that what capability modeling does is that it just don't support what we're looking for.

That capability model, and identifying the important capabilities they're on in which we have investment, that's one part of the story.

The other part of the story is that, using this information, and building a long term IT strategy.

So, as we all know, that ... model would define, the current given reduced adulate, this strategy and the target state.

What enterprise architecture do is that they can very quickly help out, take a look at all the applications and the systems that we have within our organization, to the current state assessment of them, And try to compare that reason with the targeted capability, and basically do a gap analysis, Try to come up with the things which are missing out.

And this information is very critical and important for IT Road Mapping and strategy.

Uh.

And not only that, it also helps drive the future investment, like, where, how much money we should be spending, and in which order, and what should be my priority. It also helps define that.

So, B, the long-term IT strategy.

basically, how's, how's come up with, and long-term IT roadmap, which is a strategic roadmap.

Now the next question is, you know, how the EA and capability modeling can help drive strategic technology investment.

So, this is very important question, you know, this is very important thing, that, yes, we know that, you know, capability modeling is great to have, and that basically powers a lot of our business strategy, an IT strategy. And the Roadmap basically provides us a clear vision and direction what we need to do.

But I think the thing, the bigger question here, is that, how can we get the best out of business capability modeling for our organization. There's so many different use cases of business modeling, here, I would like to talk about three use cases, which are major, which are key from an enterprise architect, sustained point of view, as well as from the organizational standpoint.

The number one is that, we can use capability modeling for defining an effective IT project, portfolio management. As we were talking about in previous slide. You know, the business capability modeling can help define the IT strategy. An IT strategy can help define the IT roadmap.

The roadmap basically translates into a project portfolio every year, what projects that we should take upon, and what projects we should be executing, and what projects we should not be executing.

Because sometimes, defining what project we should not be more important than defining what project should be security. It's all done through the, can be done through the capability modeling.

The next thing is, know, we can use this capability modeling for reducing an application's sprawl through application, Portfolio Manager, rationalization.

We can do the same thing at the technology level. We can do just the technologists crawl through technology portfolio rationalization.

And these two rationalization can help organizations do a lot of money, lot of money in wastage.

Now, let's start with, number one, Use Case, Effective IT Project Portfolio Management.

Let me ask you one question.

How, wonder, what are the different matrix that you would use for defining the success of your senior management team.

And, in case of technology, let's talk about, you know, CTO, Chief Technology Officer, how would you define the success of the CTO? What are the KPIs, What are the matrix that you can use for a while? There are so many different metrics that people talk about, and it's all about, you know, how much of the agility he brought into the organization. He or she brought into the organization.

How much of the innovation that, you know, CTO is trying to drive in the organization, how efficiently and effectively manages the budget and drives the IT strategy.

And likewise, you know, on and on there are so many different things that you can consider to define that.

Well, there is one more important KPI that I feel is should be considered as well.

And that KPI could be, that, you know, what, what we can do is, we can see the, the strategy thinking, whether it's been implemented or not, by looking at, last by year, IT budget, spending on the projects.

And aligning those projects, or the initiatives against your company's IT strategy, and see how well they align to help build those differentiating capabilities.

four, driving your business strategy.

This is the very important KPI that can help drive the effectiveness of the senior management team, like CTO, as well as the KPIs, as well as your IT strategy and roadmap.

Yours.

I have seen, you know, the typical observation is that teams prior prioritizing the project, you know how the project management portfolio management goes, right? Every year witness comes with different ideas of different tools or applications that they want to build.

Sandip Dhummad img-1These tools and applications that they are asking for is based on their need offer given date.

They, they are not necessarily being strategy.

There is no guarantee for that.

So, usually, what we end up doing is that, know, if they thought IT strategy defined in the road mapping exercise already done, people tend to spend a lot of money on the projects or building the capabilities through the projects, which are really not differentiating.

Just, let us take an example here.

So, as you see, in this diagram, you know, there are these two capabilities, call regulations and compliance.

This company has spent significant amount of money behind this to keep building these two capabilities.

Well, it's understandable.

Because Adopted 2008, there were so many different regulations that has been imposed on so many companies across the USA and then also, you know, across the world for managing the, you know, the, the, the financial regulations.

And that's why it's not at all obvious, That company would spend a lot of money on how to spend a lot of money in implementing these capabilities, or strengthening these capabilities, rather.

But, the question is that, you know, is that word going to, how did you get companies succeed?

Providing the better value to your customers with your customers.

What they are looking for is, they are looking for you doing, being efficient, on more efficient on trading so that you can provide higher rate of return, do your customers.

You should also be strategically focusing more on pumping money behind research, that's these two capabilities on top.

So that you can employ more on leveraging AI ML techniques and alternate investment data, as well as ESE index, part of your investment strategy.

That's where you should be spending more money.

Now, the thing is, that, if the capability modeling basically host, you, visualize this very easily, if you have done it effectively beforehand.

The other thing that business capability modeling helps you do it, This capability modeling can also help you manage your resources effectively.

Fun example, they, the technology companies, their main reason main capability is the resource, if you think that resources are the people they try, they basically contribute heavily to the success of the company.

Now, if the companies are not employing their best talent behind the capabilities, that's gonna help them provide more value to their customer, then, you know, obviously, the company will not have a competitive edge compared to other companies who are doing better at managing the resources and then you know, they started as he goes segment.

So, Capel Ready Modeling, mapping your resource strategy with your capability modeling, can also provide you that perspective that, you know, how effective is your resource strategy strategy?

Second use case, employing witness' Capability Modeling, poor application portfolio rationalization so that you can use the applications but all.

So, what we had done was, you know, in one of the previous engagement in one of the companies that I had worked for.

And what we had done was we came up with this framework called Application Portfolio rationalization Framework in that framework.

What I would do is, you know, I'll walk you through the entire story entire journey, how we tackle this uh, and then what framework that we implemented.

But, at Highgate, well, what we had done was, we looked at each, and every application, analyze that application, with six different dimensions, like business architecture assessment.

Trying to think that What are the capabilities this application is trying to implement?

How well it has been implemented, what is the maturity of implementation, et cetera.

The technology architecture assessment, Trying to see the solution architecture, as well as the technology architecture of this application, and then, see how well it aligns to the enterprise principles and best practices, as well as strategic initiatives.

Data architecture, also assessment the same way as technology.

The, we also want to see that how well this application is aligned to the enterprise and strategic initiatives.

Um, we also did the financial assessment of the application trying to figure out that how much of the money that we spend behind this application versus the value for store customer or to our user and then organize just an architecture. That's all about, you know, the resourcing thing that we just talked about.

We looked at all the applications with these six different dimensions.

Try to basically through these applications through the rationalization process, we will talk about, you know, what is it as the next slide? But, we basically drew them through the rationalization process and, in the end, what we had done was we came up with the the, you know, the app disposition like, you know, decide What we want to do with this application. Do you want to retain this application and tolerate? Do you want to maintain or evolve?

Copy of Email Graphic Virtual Conferences (3)Do you want to retire or replace? Do you want to re-engineer, or do you want to create new applications?

The end result of this exercise or that ve got an application portfolio that is highly efficient. There is a very low applications, prowl, meaning with a very low number number of application.

They are implementing the same, similar, same or similar capability, and these applications are built with the modern architecture so that you know, they are aligned very well with the Enterprise and Strategic Initiatives Agile IT Strategy.

Now let's take a look at the rationalization process.

So rationalization process or vertically, a six step process.

What we are, you know, so, as you say, that at very high level, you know, we looked at the PR strategy, Look at the capability definitions. The API strategy is all about defining a strategy, what we want to do with an applications. We will elaborate a little bit more on API strategy. Next slide. And then you define the capabilities. That's a capability modeling we are talking about at the organization level. That third step is App capability Analysis, where, you know, we try to compare an application with the capabilities.

And fourth step is that, based on the applique isn't capability modeling analysis, and aligning that to the capability definition or capability dictionary, that we have trying to come up with an API roadmap, what we want to do with this app, because do you want to keep it protected?

And if you want to retire pretending to, which applications, once we define the API roadmap, we hand it over to a product team. Product team, basically, define an actionable product roadmap, where, you know, they defined, how they're going to go about retiring this application.

And then in the only if we decide to return an application that is an app retirement plan, that comes out to be.

Now, API strategy so what we had done what, we came up with three prong, strategy, build, Maintain, and Mature.

So the idea here is that, rather than building one of these bulk applications, catering to one or many of one or small number of capabilities, build a strategy platform, and use this tragic platform for providing the capabilities that user is looking for.

There might be some application that those are costs application where you don't have a lot of control, or there are some critical applications, but has a technical debt. Like, you know, our build applications build long time ago.

You may want to just maintain it, rather than spending a lot of money behind it.

And then, eventually, you want to replace it, or, you know, take it out of this, and build it on the platform.

And the other other group of applications would be, would be the state where that you want to make sure if the application is catering to a strategic capability and is in good shape.

In terms of, you know, this architecture, technology architecture, data architecture, then what you may want to do is that you want to invest into that application, make it more modern cloud native architecture, API for site architecture, versus cloud portable, and, you know. Also avoid vendor lock in.

So, this was our strategy.

And then, you know, what we had done was we kind of assign different app disposition, do this strategy.

So you know it says that if any application that is marked as new or retire, that means they should go or consolidate with a platform that we're building.

Now, the third phase of the, that, you know, the API process or the app capability modeling, what we had done was, we had built up a highly interactive, rich dashboard and these dashboards basically based on the capability modeling that we had defined before and how does this dashboard help us do the application capability analysis.

So let's take a look at this. This graph here, it says zero point twenty eight capabilities, but what does that mean?

That means that there are less than one chip already implemented in an application. So you can see that, you know, that very high up sprawl, and as you see here, is but obvious FMT eight capabilities that this company has an out of that 204 applications.

The next thing is that, you know, low yield high maintenance. These days you know, the retail banking is kind of going away.

I don't know, last time when I went to a retail banking center, even though the only thing that I was going to retail banking is for my check, for depositing magic, that has been digitized for many years.

So you know, in this app this company has 24.4% applications supporting retail banking.

Business practice.

So, what we are trying to say is that this is, this is an area where you should work on.

You should try to consolidate a lot of this application, introduce lot of waste, which is not being used and, you know, lean out this portfolio. Because it's not yielding you lot of money. The return of investment is very less.

The third thing is that highly imbalanced board product portfolio.

Now, for investment banking, know, you would like to invest more on the research and trading, which is the front of this application. Here, you can see that there are a lot of back Office application, Like 77 of them.

A lot of tasks that we do in back Office or mundane trivial task.

Every bank on a street does this. There is no, there is no advantage, is not a differentiating capability.

They should try to avoid these applications by consolidating them into one platform or maybe outsourcing them into some, you know, software as a service offering.

The other chart view that we heard was this view basically talks about that there are less number of capabilities. A lot of applications, like, you know, front office, had about 72 applications and 19 capabilities.

So what this tells me is that, you know, we should, we have a lot of applications crawling this area.

The same way, there might be a non optimized application portfolio.

What does that mean? Is that, you know, the business applicant, the business, commercial and business banking. They have about 35 release and 100 plus applications.

That's a non optimized. Because, you know, typically this, this volume is not that high.

So by looking at these observations, we figured it out that we have to do three things, you know, app consolidation, portfolio optimization and high yielding product portfolio.

That's what we if we achieve this, we can basically streamline our application portfolio to become more efficient.

Now, the next question is that if we wanted to do an app consolidation, how can we go about deciding it again, but Netscape already comes in to help you?

What we had done was we created this network. But every line, A, between application, basically represents that they have a similar capability.

And the weights of the line represents how many of these capabilities are similar between F one and F two, as you see in this diagram, they are highly correlated applications.

What does that mean, is that you can replace either App with other application, like in this case, maybe I'll replace App to without one.

The other view is that we are created or do you know, because capability modeling also has this strategy capabilities.

And that basically helps us to come up with this strategic plan.

We created this nice thank you chart where, you know, I have all these obligations on on the, uh, left-hand hand left-hand side.

They are mapped to capability and then try to map these existing capability to autologous Tech platform.

And this kind of gives us very high interactive visual view on how what application should be retired or replaced with, what is the strategic platform that we're building?

So very bad.

The last thing that I would like to say and thus the this is from McKinsey, is that what McKenzie say is that the company, they implemented effective capability building program.

They have 4.1 times more likely success rate compared to other companies.

Thank you so much.

I was having trouble finding my video. But thank you very much. And you quoted.

I love the fact that you brought up the McKinsey Company, quote, There's a, A quote that we all are dealing with, which is that about 70% of all business transformations fail.

Screenshot (4)Right. So this isn't the time before you even get to business transformation. You have to understand what your enterprise architecture and is going to do and how it's going to function.

I think it's fantastic that you can speak from background of experience in doing this. We've only got literally two minutes. So, let me go through, I've got several questions, but let me see if I can go through one.

Um.

Well, OK, this isn't obvious, it's a big level question. But, let me ask you, anyway.

If you had to describe them concisely, what are the major ... Read and Write? What are the major challenges you faced while implementing the application portfolio rationalization strategy? How did you get people to let those things go?

Now, as we talked about, the API strategy was basically three things will maintain and mature.

No, everything starts with the people.

What people will do is that, you know, people don't like their applications to be flagged as a main thing. I'm talking about the technology side. So I'm talking about internal and external, right. The business users and external to me.

Technology organization is internal.

Right.

So the technology organization, they don't like that upticks them to be flagged as maintain or to be retired.

Right, So that's the constant struggle that you have to deal with it. The same thing goes with the business user, because that's more impounding impact, right?

Because it lets users, even though there are only two users using that application, and that's costing you a lot of money, they don't want to retire just because this is the tool, that they invested for it, and they love that. They want to They want for themselves.

So, getting everybody to, on the same page, I think, you know, and then, making them understand the strategic initiative, I think, you know, we had to do a lot of evangelization, of, I keep it pretty modeling to the internal like, you know, technology side as well as external, the business user side.

And getting everybody to an agreement that, OK, these This is the strategic roadmap, and these are the strategy where we should be going for And these are the things that has to merge, are the mode because these are the best So, I think, you know, the data, the the biggest hurdle getting everybody on the same page on that strategic thinking.

Know, I think about getting them on the same page and influencing people, and I remember from my days, this is a black belt in GE.

We used to say, You can either demand that they do it.

You can give them data to to prove why they should do it.

Or you can demonstrate why it should be done.

Now, maybe there are other ways to, but I like the fact that those three things started Ds. Then there's that magic portion of getting them all on the magic potion, getting them all in the room. And influencing fantastic. Sandeep.

I want to make sure we're, at the end of the end of the time, your contact information will be available at the end of the presentation and the replay. So, anyone who wants to contacts and deep on additional questions, unfortunately, we turn it off content for Q&A today on this presentation. And that's fine, because they can reach out to you. So thank you very much for presenting. We'll see everybody at the top of the hour, We'll start off our next session, which is a Journey Story Within our Business, and I'm hope you're all looking forward to that. I will see you at eight which is 10 10 Eastern Time later in the morning, Sandeep. Again, thank you very much. For your time.

Thank you.

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About the Author

more-Mar-14-2022-03-26-07-07-PMSandip Dhummad,
Director, Enterprise Architecture,
Financial services company.

 

Enterprise Architect with extensive experience of leading organization wide technology transformation initiatives, defining target state enterprise architecture vision, understanding business requirements/plans and converting them to strategic road map. Experience of defining EA operating & engagement models for enterprise in today's agile world. Published international/national conference papers. 

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