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Realization of strategic intent
through Business Architecture
Yet another year in the life of a Business Architecture Practice
David Stevens, Jason Towley and Troy Nelson
December 6, 2018
© Prime Therapeutics LLC CONFIDENTIAL1
The effective realization of strategic intent remains elusive for many companies.
This session will describe the latest developments in this journey at Prime
Therapeutics, sharing lessons learned in the pragmatic application of business
architecture to the overall investment cycle, from planning strategic initiatives to
managing project scope.
Session Overview
© Prime Therapeutics LLC CONFIDENTIAL2
Our Story Map For Today
Introduction
To Prime
Prime
Context
Business
Architecture
at Prime
S2E
at Prime
(Re)focusing
on the ‘S’
in ‘S2E’
Top
Down
Empowered
Decision
Making
Initiative
Level
Planning
Initiative
Evaluation
Parsing
Initiatives
Next
Steps
Initiative
Mapping
Estimate
Classification
Investment
Evaluation
Investment
Evaluation
Progressive
Elaboration
Prime Therapeutics
5451-F © Prime Therapeutics LLC CONFIDENTIAL4
Our purpose
To help people get the medicine they
need to feel better and live well.
5451-F © Prime Therapeutics LLC CONFIDENTIAL5
18Blue Plan owners
22Blue Plan clients
27+ millionmembers
$23.4 billiondrug spend managed (2017)
320 millionannual claim volume (2017)
3,000+employees
Prime Therapeutics: At a Glance
5451-F © Prime Therapeutics LLC CONFIDENTIAL6
Our culture
Together
AccountableCandor
Purpose
Active
5451-F © Prime Therapeutics LLC CONFIDENTIAL7
Our recognition
Inc. 5000 List of
Fastest Growing
Companies
2017
Top 100 Private
CompaniesMinneapolis/St.
Paul Business
Journal
2017
Fit Friendly
Award American
Heart Association
2016
Fast 50
CompaniesMinneapolis/St.
Paul Business Journal
2017
20 Companies to
WatchTwin Cities
Business Magazine
2017
CFO of the Year
HonoreeMinneapolis/St.
Paul Business
Journal
2017
Business Architecture at Prime
© Prime Therapeutics LLC CONFIDENTIAL9
The Essence of Business Architecture
Source: Business Architecture Guild (Business Architecture Overview)
Source: Accelare (S2E Guide R3.1)
What it is
What it is
used for
© Prime Therapeutics LLC CONFIDENTIAL10
Where Does Business Architecture Fit?
Business Planning
Information Technology
Program Management
Office
Business
Architecture
In the organization
© Prime Therapeutics LLC CONFIDENTIAL11
Where Does Business Architecture Fit?
StrategicPlanning
Business Planning
Investment Planning
EnterpriseAnalysis
Planning Execution Closure
Project PhasesPre-Project Phases
Business
Architecture
In the lifecycle
Strategy to Execution at Prime
© Prime Therapeutics LLC CONFIDENTIAL13
Capability Based Planning
(sort of)
Strategy to Execution Timeline
2013 2014 2015 2016 2017 2018
Enterprise Analysis
definition and piloting
Enterprise Analysis
extended to all projects
Enterprise Analysis
scaling and continuous improvement
Evolving to
Investment Planning
© Prime Therapeutics LLC CONFIDENTIAL14
The Context of Enterprise Analysis
Changing the order of the box cars…
Proposed
Projects
Roadmap
Planning
High Level
Project
Estimate
Selected
Roadmap
Projects
Project
Initiation
& Planning
Project
Business
Case
Project
Execution
Business
Needs
Enterprise
Analysis
Business
Case
Selected
Business
Investments
Project
Packaging
Project
Initiation
& Planning
Project
Execution
From a business case is what is needed to justify a project budget
To a business case justifies investment realized through a project
© Prime Therapeutics LLC CONFIDENTIAL15
Enterprise Analysis in a Nutshell
Business
Problem or
Opportunity
Business
Case
Business
Value
Proposition
Business
Solution
Approach
Business
Investment
Approach
Business
Need
Analysis
Business
Solution
Analysis
Business
Investment
AnalysisEnterprise
Analysis
© Prime Therapeutics LLC CONFIDENTIAL16
EA is underpinned by Business Architecture
© Prime Therapeutics LLC CONFIDENTIAL17
So What Happened to Enterprise Analysis?
StrategicPlanning
Business Planning
Investment Planning
EnterpriseAnalysis
Planning Execution Closure
Some aspects were
embedded in
Planning (in the project)
Some aspects were
embedded in
Investment Evaluation
Class 5 Project Definition/Estimates
• Investment Screening
• High Level Planning
• Detailed Planning
• Project Initiation
© Prime Therapeutics LLC CONFIDENTIAL18
Refactoring the Investment Lifecycle
StrategicPlanning
Business Planning
Investment Planning
EnterpriseAnalysis
Planning Execution Closure
Initiation Planning Execution Warranty
Strategic
Planning
Business Planning
CapabilityPlanning
PortfolioPlanning
Project PhasesPre-Project Phases
Project Phases
Planning Phases
Investment Planning
Investment Evaluation
© Prime Therapeutics LLC CONFIDENTIAL20
The Cone of Uncertainty
Source: Construx
© Prime Therapeutics LLC CONFIDENTIAL21
The Cone of Uncertainty: Estimate Classification
Class 5We know
little
Class 4We know enough
Class 3We know
a lot
Source: Construx
© Prime Therapeutics LLC CONFIDENTIAL
Positioning Class 5 in the Investment Lifecycle
Strategic
Planning
Business Planning
CapabilityPlanning
PortfolioPlanning
Capability
Analysis
Investment
Evaluation
© Prime Therapeutics LLC CONFIDENTIAL
Investment Evaluation
Purpose
● To provide a Class 5 ROM ‘project definition’
● To position the investment request in ‘the portfolio’
- To allow investment screening by Funding Portfolio- To allow delivery planning by Capability Portfolio
Participants
● Business and Technology Architects
● Requestors and Capability Leads
● Portfolio Managers
Approach
● Highly structured but lite and lean
- Value streams with capability impacts- Capabilities mapped to organization and applications- Solution patterns with demand estimate patterns
● Weekly cadence with week(s) cycle time
Investment
Evaluation
SIPOC Diagram
© Prime Therapeutics LLC CONFIDENTIAL
Investment Evaluation in a Nutshell
RequestDevelopment
RequestIntake
CapabilityImpact
Assessment
Complexity& Risk
Assessment
Class 5/ROMSize &
DurationEstimation
Investment Request Evaluation Summary
Capability Impact
Assessment
(the Placemat)
Complexity
& Risk ScoringInvestment Request• Authored by Requestor
• Authored by Capability Lead
• Co-authored with Business Architect
© Prime Therapeutics LLC CONFIDENTIAL25
Investment Evaluation became a bottleneck
• We needed a ROM before anything else could happen
• We needed a ROM more than we needed to clarify scope
Every Investment Request became a project
• Little or no capability level analysis
• Little time for Enterprise Analysis, even on complex requests
No further scope definition until project starts
• Scope and estimate ambiguity causing projects to drift
• Too many change requests too late
Box cars back in the wrong order…
Victims of our own success…
© Prime Therapeutics LLC CONFIDENTIAL
The Cone doesn’t narrow itself
Class 5 Class 4 Class 3
Requirements Requirements Requirements
Design Design Design
Work Work Work
Estimate Estimate Estimate
Better scope clarity = Better estimate
Better scope clarity
=
Better estimate
You must force the Cone to narrow
by removing sources of variability from your project
Source: Software Estimation, Steve McConnell
© Prime Therapeutics LLC CONFIDENTIAL
Progressive Elaboration in a nutshell
ClassificationScope
Document
Estimate
NameEstimate Purpose
Class 5Project
Brief
Rough Order of
Magnitude (ROM)
Investment
Screening
Class 4Project
Definition
Preliminary Budget
Estimate
Planning
Approval
Class 3Project
Deliverables
Budget Authorization
Estimate
Execution
Approval
Class 2Project
Deliverables
Revised Budget
Estimate
(only if needed)
Change
Approval
(only if needed)
Class 1Realized
Project
Final Budget
ActualClosure
© Prime Therapeutics LLC CONFIDENTIAL
Inserting Class 4 in the Investment Lifecycle
Investment
Request
Investment
Execution
Investment
Baseline
Progressive elaboration is a powerful tool to gain and increase
customer satisfaction for both Agile and Waterfall teams…
Waterfall
Agile
InvestmentEvaluation
Initiation Planning Execution
Class 5
Scope &
Estimate
Class 4
Scope &
Estimate
Class 3
Scope &
Estimate
© Prime Therapeutics LLC CONFIDENTIAL
One Size Does Not Fit All…
Scale of Change Summary of Characteristics Project Delivery Path
New or Modified
Business Capability
• Complex changes across multiple
organizations, processes and applications
• Deviates from existing and known solutions
and patterns
Pipe A
Localized Change
(within a Capability)
• Simple process, application, technology
platform or data changes
• Localized to a single context (department,
application, technology)
• Work is similar to work done in the past for
the given context
Pipe B
Standard Activity
(across Capabilities
or within a Capability)
• Repeatable, reoccurring business activities
that require coordination across organizations
• The work is known;
been there, done that
Pipe C
Recognizing the opportunity to refactor processes…
© Prime Therapeutics LLC CONFIDENTIAL30
Raising Our Game on Change Management
A problem well-stated is half-solved…
Feature From To
Initiation
Refactoring
Somewhat mechanical
‘getting organized’ step
Lean team energized about
value proposition delivery
Knowledge
Transfer
Inconsistent and limited
(even no) handover
Collaborative cross-functional
progressive elaboration
Scope
Management
Inconsistent and unstructured
scope statements
Cohesive set of requirements and
design scope statements
Estimate
Management
Inherited and sometimes
dated ROM estimates
Recalibrated estimates based on
current scope definition
Project Definition
Approval
No meaningful approval
of scope baseline
Management approval from both
requesting and delivering aspects
Continuous
Improvement
Sporadic improvement with
limited or no feedback loops
Up and downstream feedback loops
informing improvement cadence
We are improving our downstream processes to deliver projects better
Now let’s look upstream to ensure we deliver the right projects
Over to Jason
(Re)focusing on the “S” in S2E
33
Goal: Leverage Capability Planning and Management as a foundation for planning our business and delivering on Prime’s strategy
Make it real
• Tie everything back to our Strategy.
Make it relevant
• Processes only “stick” when they are aligned to and embedded in how the business truly works.
Make it continuous
• Strategy, initiatives, & investments do not start and finish according to a fiscal calendar – nor should planning.
Make it flexible
• Things will change. We never know everything at the time we baseline the plan.
Business Planning: Move from Strategy to Execution
34
Strategy as a more robust & intentional basis for investment
planning
Strategy
FROMPLANNING & LINKING BOTTOM UP DEFINED PROJECTS
FOUNDATIONAL & ENABLING PROJECTS STRATEGIC PROJECTS
35
Strategy as a more robust & intentional basis for investment
planning
FOUNDATIONAL & ENABLING INITIATIVES STRATEGIC INITIATIVES
Strategy
Priorities & Objectives
Strategy
FROMPLANNING & LINKING BOTTOM UP DEFINED PROJECTS
TOPLANNING STRATEGICALLY DRIVEN TOP DOWN OUTCOMES
FOUNDATIONAL & ENABLING PROJECTS STRATEGIC PROJECTS
FOUNDATIONAL & ENABLING WORK STRATEGIC WORK
36
Executives removing themselves from project-level
governance to focus on top down strategic planning
Top Down Planning
FOUNDATIONAL & ENABLING INITIATIVES STRATEGIC INITIATIVES
Strategy
Priorities & Objectives
FOUNDATIONAL & ENABLING WORK STRATEGIC WORK
37
Govern & hold accountability for
outcomes
Top Down Planning: Executive Focus
Strategic Planning
Where do we need to focus?
What must be delivered?
How much and where do we invest?
What outcomes do we need to achieve?
Performance &
Incentive Goals
38
Management is empowered to prioritize and determine how
to achieve the expected outcomes.
Empowered Decision Making
FOUNDATIONAL & ENABLING INITIATIVES STRATEGIC INITIATIVES
Strategy
Priorities & Objectives
FOUNDATIONAL & ENABLING PROJECTS STRATEGIC PROJECTS
39
Initiative Owners define & justify action to achieve outcomes:• Business Need
• Success Measures
• Key Deliverables, Milestones, & Dependencies
Capability Owners manage a capability plan and determine how to most effectively utilize resources to deliver the initiatives
Capability team executes the work• Programs, Projects, Activities linked directly to
initiatives
Utilizing initiatives to facilitate higher level planning
According to priority based funding
allocations & outcome expectations
INITIATIVES
CAPABILITIES
Initiatives & resources assigned
to primary Capabilities
We are translating strategic intent into a set of initiatives
Now let’s look at how we analyze those initiatives
Over to Troy
Initiative Evaluation
© Prime Therapeutics LLC CONFIDENTIAL42
• BizBok definition: an Initiative is “a course of action that is being executed or has been selected for execution”
• At Prime, an Initiative starts out as an un-funded proposal to meet an assigned outcome.
• Through a prioritization process, get selected, in part or in full, for “investment”
• The pre-Initiative activities are managed via Prime’s Strategic Planning Process; Business Architect receives the output of this process
2019: Initiatives to Investments
Initiatives drive a
structured process
leveraging
architectural models
to define the
changes required
Strategy Objectives Initiatives Investments
Projects & Programs
© Prime Therapeutics LLC CONFIDENTIAL43
• Business Architecture’s role is to parse Initiatives into Architecture
Constructs
– Start with a clear understanding of the objectives and associated course of action
– Identify Value Streams impacted by the Initiative
– Value Streams show the impacted Capabilities
– At Prime, we identify the Organizations that fund, sponsor and/or are impacted by the Initiative
Initiative Decomposition
© Prime Therapeutics LLC CONFIDENTIAL44
An example from a Lemonade stand*
*We actually have a Lemonade Stand scenario built out for use in interviewing Business Architect candidates, training new hires and
educating the company on the value of Business Architecture!
Strategy: Be the Low-
Cost Leader in the
Lemonade Stand
Industry
Objective: Reduce raw
materials costs 20%
Objective: Leverage
100% renewable
energy sources for
stand power
Initiative: Increase yield
per lemon
Initiative: Optimize
supply chain
© Prime Therapeutics LLC CONFIDENTIAL45
Assess Capabilities and Value Streams
People: Limited Production staff
Limited skills / physical strength
Process: Manually slice lemons in half
Manually press and twist lemon on juicer
Manually mix juice with sweetener and water
Information: Lacking data on expected lemon juice yields
Receive
Order
Verify
Inventory
Value Stream: Order to Delivery
Fulfill
Order
Calculate
Amount
Due
Collect
Payment
Deliver
Order
L1:
Production
L2: Lemon
Squeezing
Technology: Manual lemon juicer
Trigger:
Customer
wants
lemonade
Result:
Customer
receives
lemonade
© Prime Therapeutics LLC CONFIDENTIAL46
Initiative mapping will be used to further decompose Capability and Value
Stream changes across Programs, Projects and Sprints
Initiative Planning
Q1 Q2 Q3 Q4
S1
S2
S3
S4
Improve Collection of Yield Data
Project: RFI
Project: Technology Assessment
Project: Pilot
Project: Deploy
S1
S2
S3
S4
Continuous Improvement on
Manual Squeezing Process
Initiative: Improve Lemon Squeezing Capability
S1
S2
S3
S4
Staff Retraining Program
Program: Lemon Squeezing Technology Refresh
© Prime Therapeutics LLC CONFIDENTIAL47
• Today, Prime leverages Waterfall for most program and project delivery
• Modernization of systems driving Prime to adopt more Agile methods
• Doesn’t change the fundamental need to align strategy and execution
• But, it is driving changes to how we think about
o Products – what are “products” and how are they delivered? (map to Value
Streams!)
o Funding of investments – align to Capabilities or Value Streams or both?
o Organizational design – departmental hierarchy grouped by function vs cross-
functional teams aligned to value streams and products
Perhaps we’ll have an update at the 2019 TCBAF Summit!
Looking Forward: Prime’s move to Agile
© Prime Therapeutics LLC CONFIDENTIAL48
Our Story Map For Today
Introduction
To Prime
Prime
Context
Business
Architecture
at Prime
S2E
at Prime
(Re)focusing
on the ‘S’
in ‘S2E’
Top
Down
Empowered
Decision
Making
Initiative
Level
Planning
Initiative
Evaluation
Parsing
Initiatives
Next
Steps
Initiative
Mapping
Estimate
Classification
Investment
Evaluation
Investment
Evaluation
Progressive
Elaboration
Questions?
Our purpose:
To help people get the medicine they need
to feel better and live well
Thank you!
David Stevens
Jason Towley
Troy Nelson
51
David Stevens
David is an insightful and pragmatic thought leader in business architecture with over 15 years of consulting and management experience in both business and technology functions in the healthcare and manufacturing sectors.
He enjoys helping business leaders grasp business opportunities through the aspirational but realistic hybridization of industry best practices always focused at the business problem in hand.
David operates with an ego-less and boundary-less style and excels at bringing together sometimes disparate cross-functional parties in pursuit of a shared vision and common purpose.
He is English but has lived outside the UK for many years, with 15 years in Belgium and now happily at home here in the Twin Cities since moving here with 3M in 2001.
David currently works for a Prime Therapeutics, developing a business architecture practice and leveraging agile techniques to improve strategy-to-execution including investment planning, investment evaluation and effective execution of projects chartered to realize business value.
Jason Towley
Jason Towley is Sr. Director of Strategy and Business Planning for Prime Therapeutics. In this current role, he and his team have accountability for facilitating strategic and investment planning, materials for Board of Directors meetings, competitive intelligence, and investment governance.
Jason has been with Prime since 2004 and served in a variety of roles. Starting in IT, he led the establishment of Prime’s first IT Service Management processes based loosely on the ITIL framework. He later led the development and facilitation of Prime’s first system development and project management lifecycles. These early frameworks were foundations for maturing practices that continue at Prime today. Transitioning out of IT and into the Enterprise Project Management Office, Jason began focusing on and maturing Prime’s investment governance process. This evolved into a need to bring tighter alignment between investment planning, governance, and strategy and his current role leading the Strategy team.
Troy Nelson
Troy Nelson is Director of Business Architecture for Prime Therapeutics. He is a Certified Business Architect and a Member-at-Large member of the TCBAF Board. In his role at Prime, he leads a team of Business Architects defining the investments and changes required to support successful execution of company strategies and delivery of client requests. He is working across Prime’s Agile transformation and technology modernization initiatives, developing new business models and approaches to accelerate Prime’s delivery of value to its multiple constituents.
Speaker Bios