Architecture de novo
INTRODUCTION: USING BUSINESS ARCHITECTURE TO DESIGN A STARTUP
Business startup culture has always been contrarian and proudly unorthodox, embracing “disruption” as a first virtue and citing Schumpeter’s “creative destruction” as the essence of modern capitalism. Many veterans of startups will tell you that their business happened organically, as an outgrowth of a central idea, insight or vision and that had little or no need of formalized planning, let alone an architectural or design approach to creating the business.
The startup ‘cowboy’ (I was one of them) will not only tell you that formalization is unnecessary, but that it is overhead that gets in the way of creativity and time-to-market objectives. “Why worry now about trying to describethe business, when I’m trying to make it actually happen? A blueprint for the business can wait until after we are up and running and when there is time to attend to the luxury of an architecture.” They will point to Steve Jobs or Larry Page and Sergey Brin as exemplars of the dauntless entrepreneur, focused on ends and not means, product and not process.
But this “just do it” ethos is based on some basic confusions about the work of the startup and the role of business architecture. A startup isn’t designing just a product; it is designing a business. Every startup will have to identify and resolve basic questions about technology, product, customer, organization, capability, value proposition and other foundational issues. The question is whether it will address these issues in a muddled, accidental and incoherent way, or whether it can – in the disciplined articulation of its own anatomy – build an enduring blueprint for the business that will help it respond adroitly to the changes that lie ahead. Even in the smallest of startups, a rudimentary set of organizing principles, shared by team members and rooted in the strategic vision, will work to minimize the number of all-nighters necessary to pull off the first profitable quarter.
An architectural approach is not only not antithetical to innovation, it is the basis for flexibility and stability in the midst of the frequent and abrupt change that every startup will undergo. Architecting the startup avoids aimless thrashing and provides a scaffolding for creativity. It is a disciplined, structured way of answering the basic existential questions facing every startup:
- What is my strategy for succeeding?
- Who are my customers and what are their pains, gains and current ways of coping?
- What is my value proposition to these customers?
- What requirements must my product fulfill in order to deliver value to my customers?
- What sequence of activities must my business engage in in to deliver value to my customers?
- What capabilities must my business have in order to carry out its activities?
- How do I shape an organization to deliver these capabilities?
- What are the basic business information concepts that will form the basis for my communications, analysis and reporting?
An architecture needn’t be highly formalized or deeply developed to be of great help in clarifying problems and creating a shared perspective across functional areas of responsibility. Whiteboards, napkins and the backs of old envelopes are adequate for first iterations – so long as each person gets a copy. And, because a business architecture is constructed by business members themselves – in the roles subject matter expert, analyst or even rapporteur – the very act of constructing it ensures that it is vetted and ‘owned’ by all relevant parties.
In the pages that follow, I offer a design for a startup business using the tools of business architecture. I hope to show how architecture can provide the entrepreneur with the focus necessary to survive and thrive. Far from being a ponderous exercise in navel-gazing, I hope to show that an architecture need amount to no more than a sketch in order to provide a solid foundation for execution and a powerful tool of analysis.
The substrate for my business design exercise is painfully autobiographical – it is a startup that I started up in 2005, and which failed in 2008, called Portaga. I am therefore an expert in my own subject matter and get to rehash decisions which, with the benefit of hindsight and the acuity of an architecture, might have saved the company. Much as a cadaver is used to teach anatomy and pathology, I will dissect Portaga as it was and was intended to be. The death of Portaga will form an epilog to this paper, should the reader be curious why such a brilliantly conceived business could fail.
This paper is organized as a sequence of business architectural analyses that build on one another, and that reflect the canon of business architecture as promulgated by the Business Architecture Guild®, a non-profit association that has built the intellectual and organizational foundation for the practice of business architecture, and whose members include some of the world’s most respected companies. The paper divides into the following sections, which will be released in sequence, following on the publication of this introduction.
- Strategy– a plan for making a vision real.
- Value– the raison d’être of the business; its final cause.
- Capability – a capacity, ability, potentiality for delivering value.
- Product – the thing or service that is of value to a customer.
- Organization– the home for business capability.
Business architecture (hereafter shortened to “BA”) is ultimately far more comprehensive than just these topics and it aligns with a wide range of business and IT disciplines, but our object here is not BA pedagogy. Indeed, I will gloss over many of the details of business architecture theory and will not discuss its many views and various interfaces to Agile, Customer Journey, Business Model Canvas, Software Development Lifecycle, Microservices, Data Architecture and Enterprise Architecture.
Instead this paper is intended to illuminate the way in which an architectural approach to new business design can be a powerful way of focusing effort, maintaining alignment and configuring a business for success.
Look for the next installment soon! Feel free to contact me or offer your opinion below. In the meantime, please enjoy some other explorations in this subject:
Andrew Carnegie turned the nascent 19thCentury steel industry in the US on its head by using the Bessemer process to burn away carbon from pig iron (which brought down the cost of steel production), and by vertically integrating coal and iron mines, steamships, railways and even bridge-making capabilities.
Lack of focus is the #1 reason for business failure, according to a recent Harvard Business School study by Shikhar Ghosh. See https://www.entrepreneur.com/article/288769. Of course, the reasons for business failure are complex and manifold, but I would attest (from personal experience) that paying attention to the right things, day after day and week after week, is the single most important habit the entrepreneur can develop. What these ‘right things’ are is an outgrowth of a good foundational architecture.
I might therefore admit to some self-reflective, if not outright cathartic motivations for using this as my example.
See: http://businessarchitectureguild.com. From the Guild: “The Business Architecture Guild® is a community of business architects who have come together to build and expand their profession. The Guild is an international, diverse community of business architecture practitioners, beneficiaries and interested parties. We are a collaborative collective where individuals can learn with and from their peers, explore and develop new ideas, and further the practice and discipline of business architecture.”
The Business Architecture Guild counts representatives from The Boeing Company, Federal Express, CGI, Highmark, the USPTO, Nordea Bank, United Airlines and Wells Fargo.
Readers are encouraged to sample the Business Architecture Body of Knowledge, or BIZBOK® guide – a sample of which is at: http://c.ymcdn.com/sites/www.businessarchitectureguild.org/resource/resmgr/BIZBOK_6_5/BIZBOK_Guide_v6.5_Part1.pdf.