Defining and Describing Business Architecture

The most fundamental concept of Business Architecture (BA) is that it represents business. BA is one of the domains that comprise Enterprise Architecture (EA) that define the business strategy, governance, organization and key business processes (Klein & Gagliardi, 2010). From the literature review, there are various definitions for BA can be found. In defining BA in term of enterprise, BA is consider as governance structure, business process and business information. In term of architecture aspects, BA can be categorized as an activity and a well-structured documentation of a current and future business environment. Referring to the above definition in both term, BA can be describe as “a blueprint of the enterprise that provides a common understanding of the organization and is used to align strategic objectives and tactical demands” (BIZBOK Guide, 2013) .

Another definition of BA is from The Open Group Architecture Framework (TOGAF), which is it defines BA as the business strategy, governance, organization and key business process information, that closely related to the business environment which is based on business principles, business goals, and strategic driven (The Open Group, 2009). Others have also defined BA as the basic relationship between business entity’s environments with its intent, value, capabilities, processes, and resources including human, Information Technology (IT), knowledge, capital, facility, and material (Strosnider, J. et al., 2002).

Considering on the previous definition of BA, it has several important elements that create a common foundation of business architecture, which is can be categorized with a wide variety of views as illustrated in Figure 1. The foundational perspectives such as: what a business does (capabilities); the vocabulary it uses (information); how a business is organized (organization); how a business delivers value to stakeholders (value stream); and what a business should do to compete and thrive (strategy) (William Ulrich & Kuehn, 2015). All of the answers from these questions are derived from business architecture, which then used to develop plans, make and implement business decisions.

BA is the first activity that needs to be taken in organizational process and required as a prior condition for Enterprise Architecture before any other domain that are Information, Application and Technology Application. BA is widely used to design competitive structures and processes, leveraging on existing strengths, and identify potential business opportunities that will accelerate on the business’s objectives and drive organization’s innovation (FEAPO, 2011) . Figure 1: Business Architecture Ecosystem. (Source: (Ulrich & McWhorter, 2010)

In brief, the concept of BA can be consider as a process to define organization from a business perspective and act as a general practice in order to govern and manage change and transformation in three key areas, which are strategy, operations, and technology as shown in Figure 2 (Hendrickx, Mahakena, Daley, & Von Rosing, 2011). Following are details on three key areas as defined by (Tikkanen, Lamberg, Parvinen, & Kallunki, 2005):

(a) Strategy defines the vision and direction of an enterprise, governing its actions and enterprise structures.

(b) Operations refer to the ongoing recurring activities, which consume resources and capabilities in order to produce the output of the enterprise.

(c) Technology refers to information and technology architecture that consist of an application component, tools and infrastructures implemented on a technology platform.
Among the three key areas that driving the business architecture’s growth, the BA would also identify how effective the organization in building financial analytics and where it can improve the capability and competency from a holistic perspective.