André Christ is co-founder of SAP LeanIX co-founder. His keynote at the SAP Transformation Excellence Summit in Frankfurt, summarized here, focused on how enterprise architecture (EA) supports and drives business transformation in a volatile market.
The pandemic and its broad economic impact, from unemployment to supply chain disruption, are gradually fading into the past. Yet, the global economic situation remains uncertain and even volatile.
Back in July, we saw a Crowdstrike update go wrong and crash computers and businesses, including major airlines, all around the world. In August, the Japanese stock market experienced its biggest drop since the 1980s, roiling markets everywhere. And Germany, long Europe’s strongest performer, currently has the slowest growing economy in the G7.
Against this backdrop, however, we see momentum in the enterprise architecture market. Although EA as a discipline has been around for decades, businesses across industries have come to realize the value in the mapping, modeling, rationalizing, and optimizing of the IT landscape that EA makes possible.
As an indicator of EA’s growing importance, consider what's happened in just the last six weeks or so:
- we saw some long-expected consolidation in the relatively crowded EA market with Bizzdesign announcing a merger with Mega International and Software AG
- this was followed closely by ServiceNow rebranding its application portfolio management product as ServiceNow Enterprise Architecture
- at the end of last month, EA vendor Ardoq announced a joint solution offered in partnership with process mining company, Celonis
- this came shortly after Ardoq announced the purchase of a process modeling company, ShiftX
Why Enterprise Architecture And Why Now?
The answer to the question of why enterprise architecture is suddenly on the rise lies, in part, in the volatility I just mentioned. For companies to adapt to the rapid, unexpected changes in markets and geographies, not to mention the emergence of revolutionary technologies, such as generative artificial intelligence (AI), they must become more agile.
In most cases, this means they must transform, from the way they go to market and interact with customers all the way down to the processes and technological infrastructure they depend on to run as a business. Yet, business transformation poses significant challenges because it can be complex and expensive.
As companies invest in new technologies, they also need to invest in the development and implementation of new processes and workflows. All of this, in turn, demands greater investment in employee enablement, and IT budgets get eaten up entirely by increasing operational costs with nothing left over to invest in innovation and transformation.
Brute force will not resolve this situation by working more hours and throwing more and more money at the problem. Every company has budgetary limits and, right when the need for more people and more investment is greatest, companies are trying to rein in budgets and rationalize their workforce.
If you can’t outwork the problem, you have to outsmart it, and that means, first and foremost, becoming ever more data driven. Only with streamlined access to reliable data from across your organization can you apply that data and the insights it contains to process and performance improvement.
Performance improvement means automation, and automation increasingly means AI. Not only will data help you identify opportunities for automation, but effective automation and dynamic applications of AI in turn demand a continuous flow of data.
The Right Tool For Enterprise Architecture
For companies to tame the complexity I’ve described and ensure the optimal integration of technology, data, and processes, they must streamline and modernize their enterprise architecture. The beauty is that, as you make your enterprise architecture more standardized and efficient, you free up money for other things.
That is, you can use the money you save through efficiency to finally fund ongoing transformation and innovation projects. We could call this the virtuous circle of EA.
Realizing this kind of ongoing, game-changing value requires the right EA tool, and, naturally, I believe we've created exactly that tool at SAP LeanIX. We've unlocked value with our use-case focused approach, including:
- Application portfolio assessment
- Application rationalization
- ERP transformation
- Technology obsolescence risk management
- Business transformation
- AI governance
- IT sustainability
Dealing with these use cases means applying a standard pattern to them. From our perspective, this pattern starts with the creation of a trusted inventory of applications, IT components, and other IT assets.
Once you've documented what your IT landscape consists of and mapped the connections between its elements, you can begin deriving architecture insights, such as:
- Is everything fit to purpose?
- Where are opportunities for rationalization and modernization?
- Where do we find obsolescence or compliance risk?
From these insights, it’s a natural step to architecture recommendations:
- What business capabilities will my architecture need to support in the future?
- What would a more agile or adaptive architecture look like?
- How must my architecture change to accommodate emerging tech like AI?
AI Efficiency, Human Control
Once you have your recommendations, you can take action to move from strategy to execution through a guided transformation process. You develop and execute on a roadmap, tracking progress along the way and the impact once you’ve arrived at your destination.
One way we've made this faster and simpler for enterprise architects is to power that entire journey with artificial intelligence (AI) capabilities. For example, we're making it easier to quickly create a trusted inventory with our AI-powered inventory builder, which can create an inventory for an image, a diagram, or even a PDF.
Of course, we've still ensured that enterprise architects remain in control of the process. Our AI capabilities will merely make suggestions on the best courses of action and the final choice remains with you.
Building a trusted inventory isn’t just about efficiency or productivity gains through automation. It also depends on the robust integration and correlation of diverse data sources and data types like software bills of materials (SBOMs), and all these integrations and automations must serve the same end: continuous data quality improvements.
The key to providing quick access to actionable architecture insights is meeting users where they are with AI-enhanced UX. We also do this by simplifying navigation through the inventory, as well as by extracting best practices from anonymized data and sharing this directly in the tool.
Tracking EA Decisions And Performance
To serve the organization, it should be clear how decisions about architecture recommendations are made. For this reason, we've added the ability to track and document architecture decisions within SAP LeanIX.
All of your EA data lives in the tool. Your principles and decision-making processes should be documented there as well.
One thing worth mentioning in this regard is the upcoming release of our executive dashboard. While it's critical to get as much consistent and reliable data into the tool as possible, it’s even more important to get practical, actionable insights out of it, and not simply for enterprise architects and IT teams, but for the leaders of the company as well.
SAP LeanIX will not only inform transformation, but also guide it, helping to monitor progress and ensure the achievement of transformation goals. One way we do this is through seamless linkage with agile tracking tools like Jira, but we've also gone one step farther by formalizing the transformation process in LeanIX with a transformation fact sheet.
To support these and other innovations, we've increasingly focused on enhancing the performance of SAP LeanIX. For an EA tool to deliver consistent value, it must be easy to use, but this isn’t only about an intuitive UI.
It’s also about ensuring that the tool works the way customers want it to work. There’s no point in aggregating more and more high-quality EA data if you can’t access it or quickly apply it to the vision you seek to realize.
EA Matters
What I said last week in Frankfurt and what I’ve tried to convey in this post is how SAP LeanIX empowers businesses to transform by creating a leading enterprise architecture tool. As I trust you’ve seen, this isn't a theoretical question, but one we're answering practically with the capabilities and performance of our solution.
Twelve years ago, we set out to create the best EA tool and worked closely with our customers to deliver on that promise. Our commitment to continue on this course has only been strengthened.
To illustrate what I mean, and as I have said before, we devote 70% of our product development budget today exclusively to what I’ll call 'agnostic' EA capabilities. We devote the remaining 30% to development focused on deeper integration with the SAP ecosystem.
In conclusion, I'll say this very simply: EA matters, more than ever before. Because we want companies to get the most from their EA practice, we've built and will continue to evolve a leading EA tool that improves EA, fosters collaboration, enhances decision making, and above all, powers holistic business transformation.
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