Transformative initiatives should be based on enabling capabilities, using architecture elements to define requirements and improve agile delivery.
Marketers and product managers are enabling enticing and optimal customer insights. Their organizations use various agile methodologies in the hope of speeding things up; yet most of them struggle in delivering results on time and within budget.
Enterprise and business architecture can unravel and prioritize customer journey initiatives by identifying and focusing on the problematic and enabling capabilities of their organization using a “Personal Loan” customer journey map example.
It is important to base transformative initiatives on problematic enabling capabilities that are focused on important applications and their databases. This requires the use of architecture elements to define requirements precisely, with epics and user stories commonly used in agile projects to accelerate planning and lower the number of scrums.
Transformative Initiatives Based on Problematic Enabling Capabilities
The problematic enabling capabilities in the example, shown in Figure 6, indicate that the bank is generating an abnormally high number of errors while fillings personal loans for its customers. Therefore, the bank is instigating the “Lowering Errors in Personal Loan Filling” initiative as shown in Figure 7. This initiative consists of 4 sub-initiatives that should have a positive effect on the 4 problematic enabling capabilities as followed:
- The sub-initiative “Increasing the Accuracy of the Account/Agreement Interest Determination” should positively impact the “Account/Agreement Interest Determination” capability
- The sub-initiative “Automation of Loan Filling and Disbursement Process” should positively impact the “Financial Transaction Disbursement Management” capability
- The sub-initiative “Increase the Precision of the Description and Value of Collaterals” should positively impact the “Collateral and Loan Pairing” capability; and
- The sub-initiative “Increase the Accuracy of Client Scoring” should positively impact the “Client Risk Scoring” capability.
After examining gap items for each one of the 4 problematic enabling capabilities in the “Lowering Errors in Personal Loan Filings” gap analysis, a specific strategic outcome needs to be established for each one of its impacting sub-initiative as shown in Figure 8 below. The 4 strategic outcomes in this example are as followed:
- The strategic outcome of the sub-initiative “Increasing the Accuracy of the Account/Agreement Interest Determination” could be “Calculate the Account/Agreement Interest Determination Based on Client Risk Scoring and Collaterals”
- The strategic outcome of the sub-initiative “Automation of Loan Filling and Disbursement Process” could be “Limit Human Intervention of the Loan Filing and Disbursement Process at the End for Final Approval”
- The strategic outcome of the sub-initiative “Increase the Precision of the Description and Value of Collaterals” could be “Have Less than 5% of Collaterals Valued at Least than 90% of Capital Loan”
- The strategic outcome of the sub-initiative “Increase the Accuracy of Client Scoring” could be “Establish Client Risk Scoring on 2 Independent Credit Scoring Agencies”.
It’s only at this stage that an organization should examine the current and future software applications that are or could support the problematic enabling capabilities and the databases used by these applications to build various scenario roadmaps, as shown in Figure 9 below. In this example, the “as is” current state are shown with the full lines indicating the use of current databases for each currently used application supporting the problematic enabling capabilities. In one of the two scenarios (without blockchain), the following could be delivered based on the example:
- The Application Asset “Bank Credit Line/Customer Credit Line/Customer Security Line” now uses the “Risk Management Database”.
- The Application Asset “Risk Management and Compliance Application Package” now uses the following databases: “Client Database 2”, “Public Collateral Registration Service”, “Client Risk Scoring Service 1” and “Client Risk Scoring Service 2”.
- The application asset “Consumer Banking” does not use the “Consumer Banking Database”, but instead the “Client Database 2”.
In brief, it involves the use of more databases by 3 supporting applications, shown by the dotted lines. A similar diagram could be built for the blockchain scenario.
Delivering Optimal Customer Journeys
Most chief digital officer and their corresponding Scrum teams within an organization perform some common functions. They design user interfaces, develop software for apps, websites, and automated journey steps, analyze and measure customer interactions data, oversee the back-end support of the organization’s sales and customer services operations, and provide customers with marketing insight to ensure that branding is embedded throughout the customer journey, without any architecture at the planning stage. In an article entitled “Digital Transformation Using Enterprise and Business Architecture” the author states “90% of corporate leaders view digital as a top priority”, and yet “83% of leaders struggle to make meaningful progress on digital transformation.” If agile teams were to start incorporating architecture at the planning stage, the number of leaders struggling to make any meaningful progress in their digital transformation would be much lower.
Defining a detailed and very useful user story, as described in Figure 10 above, based on an architected customer journey would accelerate greatly its delivery. Most of the words used in this user story are made up of detailed elements defined and structured within the business and enterprise architecture of the company, including capabilities, stakeholders, value streams, information concepts, and business processes. Gathering the information to complete this user story using a business and architecture model will be completed at a quicker pace and at a lower risk of failure. Furthermore, building relevant requirements, epics and users stories using the organization’s business and enterprise architecture will allow business analysts to waste less of their time and the business stakeholders’ time from which they need to extract knowledge from.
Enterprises use more and more various agile methodologies in the hope of speeding things up with the pursuit of optimal customer journeys. Yet most of them struggle in delivering these journeys on time and within budget. To make meaningful progress in their digital transformation, corporate leaders need more than agile approaches. Agile teams need to start incorporating architecture early on at the planning stage of their initiatives. Focused business and enterprise architecture allow corporations to prioritize better at the planning level, cut time lost building relevant epics and user stories, and finally lower significantly the number of sprints necessary to complete their projects.