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IT is crucial for business, which is why IT departments need to become more closely interconnected with a company’s business organization. Modern enterprise architecture is driving this development. Enterprise architects and CIOs from companies in various business sectors presented their strategies and projects at the “EAM – Pointing the Way Forward for the Digital Transformation” conference in Berlin, which was organized by the Cross-Business-Architecture Lab in cooperation with Inside Business. All conference participants agreed that the topics they need to focus on are data analysis, the cloud, agile work processes, and rapid response to change.

It’s all about data: “IoT is driving the data supply, while AI is driving data demand,” said Dr. Karsten Schweichhart, Data Economy Executive at Deutsche Telekom AG and Member of the Board of CBA Lab, in his opening address at the conference. “If data is the new key raw material, then all dimensions of conventional raw material processing apply to the way we use it. This means we need to mine and refine data, and we can also trade it.”  As Schweichhart pointed out, these are the activities that IT organizations now need to perform in order to successfully address the challenges associated with the digital transformation.

In terms of enterprise architecture, this means that enterprise architects can no longer limit their focus to addressing technology and governance issues but must instead work to establish forward-looking business architectures that best support the achievement of short and long-term corporate goals. The data needed for this is provided by enterprise architecture management (EAM) organizations. This new approach also allows enterprise architects to address issues such as data architecture, data analysis, agility, and business optimization. If they work together with the business organization while doing so, they can explore new technologies and identify potential new business segments where these can be applied. EAM thus becomes both a mindset and a toolbox for the digital transformation.

Not all business and industrial sectors have made the same progress here, however.  “You can compare the various sectors to explosives that have fuses of different lengths,” Matthias Kohl, Head of the Digital Factory at DAK-Gesundheit, said at the conference. “Some sectors have already lit their digital transformation fuse, so to speak, while other have yet to do so. The only thing that’s certain is that everyone is going to have to light the fuse at some point.”

Data is everywhere

A fuse has certainly already been lit at Munich Airport. “We’re kind of like a small city with airplanes,” said Michael Zaddach, CIO of Flughafen München GmbH, in his keynote address. “Operating an EAM organization here and highlighting how all the different systems are connected is a huge challenge – but digitalization always involves challenges. As Zaddach pointed out, due to the complexity of the systems involved and the critical infrastructure (KRITIS) standards that have to be met, automation can only be effective to a limited extent in EAM, which among other things shows where different types of data are located and how data-to-data communication occurs. Here, you need to have transparency and discipline with regard to the documentation of the system landscape and the processes that are support by the system in each case.

“We can use EAM as an effective response to the tremendous digital pressure to change,” Zaddach explained. This makes sense, as air traffic is increasing, IoT is becoming more important, B2B connections are increasing, and airplane passengers also now expect to be able to use state-of-the-art communication solutions and apps. “We need to take action; otherwise we’ll be overwhelmed,” said Zaddach, adding that these days it’s possible for the airport to offer new services, make its processes more efficient, guarantee security, and meet KRITIS requirements. The technology is there, “but it’s not always easy to bring together all the people involved in various projects and ensure they’re all on the same page.”

Moreover, every CFO’s dream of reducing costs is not going to come true in such a situation. “Costs will increase; there’s no way to avoid that,” said Zaddach, who himself dreams of a “digital twin of the airport with a slider control unit that lets you show what will happen if one thing or another occurs, and how you need to respond in each case.”

Doing everything wrong with EAM – and then suddenly everything works

At the conference, the giant mail-order company OTTO also presented a good example of how to manage the digital transformation. OTTO’s digital transformation is being driven by competitive pressure, particularly from Amazon.  

EAM enables technology to be used to not only make a company like OTTO a better retailer but also to change its business model. That’s why OTTO is now in the process of transforming its purely retail operation into a platform business. “This involves a completely different business model, which means that the way we define good IT and architecture has also changed completely,” said Thomas Greutmann, Head of Enterprise Architecture at OTTO, at the conference. Now everything revolves around the pace of change, as Greutmann also pointed out: “Being efficient is not enough to win in our market – we can only win if we are able to change rapidly.”

Greutmann described his mindset as follows: “We no longer work with big defined plans; it’s more like we operate in a sketch mode, just like building architects do sometimes in order to figure out exactly what they will need for the actual job.” In other words, these days an incremental bottom-up approach is used that has individual teams working on specific topics and issues – with architects always contributing their expertise on an equal footing and ensuring that all networks operate smoothly. Greutmann offered an example here: “In terms of platform development, we had five or six iterations or sketches that then served as a basis for architects and the teams to jointly draw a picture that showed why platforms are important for our technology.”

At the same time, not all traditional architecture approaches have disappeared, as Greutmann also explained: “Knowing the entire landscape with all of its branches and interfaces, and understanding how the different elements interact with one another, is still very helpful for us.” Indeed, when addressing major cross-sector issues, such as the EU General Data Protection Regulation, it’s important to know how many business assets, properties, products etc. you have that are relevant in terms of data protection, and where these are located.

Doing is like wanting – just more extreme

DAK has been employing an enterprise architecture management approach for four years now. It was moved to do so by the increasingly complexity of its business operations that had been brought about by mergers and the digital transformation. DAK, which is a health insurance company, is using EAM to ensure it can better meet customers’ expectations relating to mobility, time-independent service and various services, transparency, and clarity.  “Today’s customers are mobile and expect to be able to access services at any time,” said Matthias Kohl, Head of the Digital Factory at DAK-Gesundheit, in his conference presentation “Doing is like wanting – just more extreme.” “They also expect us to be heavily service-oriented, transparent, clear about what we offer, and highly flexible. Customers want to be able to use digital services for everything that’s available on the company website, and also in the form of apps.” However, Kohl also pointed out that more and more internal processes need to be digitalized as well, and also made leaner and faster.

All of this is putting pressure on established IT departments, which therefore now need to develop new and agile work methods. Kohl’s mindset is as follows: “We have a ship and now we need to get employees up to speed on how to run it.” For Kohl, agility, minimal hierarchies, and collaborative platforms are the engines of development here – and also aspects that motivate employees. After all, “you shouldn’t moor a speedboat to a tanker if you want to pick up speed.

Ultimately, EAM creates the transparency we need to help with our decisions and monitor our progress within the framework of the digital transformation.”  Nevertheless, not everything can be extracted from existing data, which means expert assessments and opinions are still needed.

Old on-premises system meets the cloud

Elenie Richter, Chief Architect IDM & Organization Data Management at EnBW Energie Baden-Württenberg AG, says that “virtually no products or processes exist anymore that are not related to IT in some way. IT is the product now, since companies like ours can hardly make money anymore with electricity.” In her presentation at the conference, Richter described how EAM is enabling EnBW to survive in a multi-cloud universe. Old on-premises systems are no longer sufficient for meeting the new requirements of the digital transformation, according to Richter. Instead, the use of cloud services is the only way to ensure rapid adjustment to fast-changing situations and permanent adaptability, flexibility, and scalability. “You can’t do predictive maintenance with our on-premises solutions, for example,” Richter pointed out.

EnBW now faces a challenge in that “an old on-premises system is meeting the cloud.” For enterprise architects, this means that “digitalization, IoT, and the cloud are triggering waves of modernization that are actually moving faster than we can process them.” According to Richter, it’s now nearly impossible to document everything down to the smallest detail: “Instead, we have to focus on what’s really important. The key issue here is to get system structuring and appropriate separations, decoupling, and dependencies under control.”

At the end of the conference, Dr. Johannes Helbig, Chairman of the Board of CBA Lab, explained why the event was so important: “EAM is an issue that never goes away because architects are the ones who understand how everything is connected. Nevertheless, all the speakers here have made it clear that the role of EAM has changed in the digital transformation. Whereas the focus in the past was on cost efficiency and governance, EAM now needs to deal with new disruptive technologies, new business models, and a new and more extensive focus on the customer.” Helbig also pointed out that in this situation every company has its own set of requirements and its own drivers of change that need to be responded to quickly: “Mail-order companies need to keep pace with Amazon, smart-home appliance manufacturers like BSH Hausgeräte GmbH want to offer their customers platforms on which products themselves become platforms, and KRITIS companies need infrastructure that is truly sustainable.”  

While summing up the conference, Helbig also quoted a conference participant: “He told me that for him the event ‘was EAM for adults.’ This short but sweet statement made me very happy because I interpreted it as true praise for the quality and professional nature of the event itself, the topics covered and, of course, the people who attended the conference.” Dr. Schweichhart had the following to add: “There were so many creative and interesting ideas here that everyone left the conference feeling that they’d gained something.”