Is Enterprise Architecture Suitable for Small Businesses?
Enterprise Architecture (EA) is considered a mandatory tool for big companies, those which can afford the required human and financial resources to use it. But some question that assumption affirming that EA is for SMBs too.
Mike Kavis, an enterprise architect and consultant currently working for a small startup – 20 people - , affirms they are using EA methods because it is valuable to them:
The first thing we did was brainstorm for 2 days on the CEO/founder’s initial business idea. We created a business architecture that we represented visually on one slide. This picture allowed us to describe our business to both technical and non-technical people. By capturing the entire ecosystem of our industry, we were quickly able to analyze our business model and refine it. We were able to determine what parts of the ecosystem we should compete in and what parts we should partner in. Before we built this visual model, we were planning to compete in areas that we shouldn’t have.
Kavis mentions they are not using the whole stack, but are using planning and business elements that make sense, considering their target and available resources:
My company consists of less than 20 full time employees, advisors, and consultants (Size=small). Our culture is comprised of seasoned veterans who are entrepreneurial in nature. We don’t believe in rigid process. Our budget is limited since were are funded by angel investors. We have extremely talented engineers and business people with years of domain knowledge. We don’t see ourselves exiting in the next two three years yet we don’t expect to be here in 20 years either (longevity=medium term). Our desired outcome is to be agile, easily integrate with partners and customers, and to be respected as first class organization. So I analyzed this criteria and came up with the following components of EA that I believed would help us meet our goals:
- Business architecture
- 3-5 year business roadmap
- Portfolio management (prioritizing what we work on and when)
- Various technology visuals (infrastructure, information, etc.)
Commenting on Kavis’ post, Colin Wheeler asks and answers 3 questions:
What is an enterprise?
In the spirit of the OED, we would agree that an enterprise was one or more individuals with a common set of goals.
When do we need architecture?
Enterprise architecture is needed in any enterprise that can see its business in terms of modules or components and architect those.
Should SMBs be doing EA?
The answer to that was very simple…If there is a business value in doing architecture, then they should be doing it. We must remember that enterprise architecture can be done in VERY lightweight methods that can deliver significant value to any enterprise.
In yet another comment, Peter Evans-Greenwood suggests a lightweight approach to EA for SMBs:
EA, as it is currently practiced in TOGAF et al, has no place in SMB. It’s just too expensive. With your average EA team running $1m+ in just salaries, most SMB companies just won’t be able to find the money.
That said, there is definitely growing demand in SMB for smart and agile approach to IT strategy. It just won’t look like traditional EA, once we sort out how to service that demand.
Joe McKendrick, an author and independent analyst, supports Kavis’ idea that EA is not just for the big guys:
EA may be even more critical to small and medium-size companies than their larger counterparts. But there is a misconception that only big companies need EA.
McKendrick quotes IFEAD’s definition pointing to the fact that there is no mention about large organizations in it, concluding that EA applies to any enterprise – seen as an endeavor to reach a goal - :
Enterprise Architecture is a complete expression of the enterprise; a master plan which “acts as a collaboration force” between aspects of business planning such as goals, visions, strategies and governance principles; aspects of business operations such as business terms, organization structures, processes and data; aspects of automation such as information systems and databases; and the enabling technological infrastructure of the business such as computers, operating systems and networks.
Brenda Michelson, a business consultant, hits the nail on the head in a tweet sent to Kavis:
Problem is, many equate EA w/jumbo frameworks & rigid governance, rather than set of values & practices for capability delivery.
If EA is indeed tightly connected to a large framework like TOGAF, then SMBs should have nothing to do with it because they simply cannot afford it. But if EA is a set of practices and values, then it is recommended even for very small business, using what makes sense.
If a SMB thinks it needs EA, it probably needs new management team