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Perspectives

Creating Elastic Digital Architectures: Part II

2014-06-24


In part I of the two-part series on creating elastic architectures, we covered in detail the four key questions companies must resolve to translate flexible IT service delivery into competitive advantage. We also discussed the best structure for a 21st century enterprise, new capabilities to be gained through increased elasticity, the role of an elastic digital architecture and also the new role and optics for IT.

In part I of the two-part series on creating elastic architectures, we covered in detail the four key questions companies must resolve to translate flexible IT service delivery into competitive advantage. We also discussed the best structure for a 21st century enterprise, new capabilities to be gained through increased elasticity, the role of an elastic digital architecture and also the new role and optics for IT.


Drawing from the theoretical understanding of the role that EDA plays in building elastic enterprises, and from our practical experience in EDA transformation for large organizations, in the second part, we make some key recommendations for extracting value from an EDA and transforming IT.

The process has three important parts:

  • Determining what is to be built in-house vs. outsourced

  • Assessing capabilities current architecture and IT project portfolio in terms of SMAC stack

  • Socializing and communication benefits

Now, let's look at them one by one. Here is how the CIO and management team can specifically address issues of building in-house vs. outsourcing:

  • Think "from the top-down" about how to solve business problems.

  • Keep "core" services in-house. Then, turn over everything else that's non-differentiating (the context) to trusted partners so their teams can focus on innovating or adding value to the business core.

  • Expand the focus to customers, partners and markets. Ask, how can we extend products, reach new markets and build flexible business platforms?

  • Think about how to "broker" what the business needs from inside or outside of the organization.

  • Think strategically about how technological trends can enhance the company's strategy, value proposition and offerings.

Capabilities Assessment and other initial steps:

  • Assess the current architecture of your core systems. Are any of the core systems candidates for becoming business platforms? To what extent does the current architecture of your core and ancillary systems support new standards for interoperability? Examine any current re-architecting efforts in process for their ability to enhance elasticity.

  • Assess the current IT project portfolio in terms of the SMAC stack. How would you rate each project in terms of its support for an EDA? For example, many mobility projects may provide an avenue for EDA, since most mobile providers must support global standards and operate in various mobile industry business ecosystems. The same is true for social and data analytics initiatives.

  • Form a team to begin outlining the elements of an EDA for your company.

  • Then, consider educational activities so that staff becomes familiar with elastic concepts and the structure and function of EDA elements.

    • Last, but not the least, resist the temptation to create a big bang architectural project. The key to EDA is to build on existing strengths and assemble the EDA with a combination of internal and external components and capabilities.

Socializing and communicating benefits

At the strategic level, it is important to socialize and communicate the benefits of increased elasticity in the context of the state of your industry, the state of global competition and customer demands.

  • Begin discussions with key stakeholders to explore what new levels of business flexibility could be provided to the enterprise and, specifically, particular business lines, products and markets.

  • Consider broadening the discussion to include some specific strategic workshops to surface new ideas for competitiveness. Experience shows that companies are often already thinking about forays into new markets, redesigned and enhanced products that enable new levels of partner involvement or participation in business ecosystems.

  • Use the architectural assessment results to identify current architectural limits to the business strategy. How urgent is the development of an elastic digital architecture? What are your competitors doing? Is your industry undergoing transformation?

  • Given the architectural and strategic assessments, what must IT do? To accomplish this, IT needs to develop a plan of action and roadmap.

To remain relevant to the business, IT must create a new "master" elastic EDA comprised of social, mobile, analytics and cloud services. An EDA enables and drives innovation by virtue of its extensibility and flexibility to meet changing business needs. It produces powerful and immediate change when the IT organization can say "yes" instead of "no" to possible business-changing initiatives, such as new business capabilities, products and services.

Figure 1

By exploring options of building services externally, understanding architectural and portfolio-related capabilities and communicating clearly the benefits of transformation, organizations can pave the way for a smooth transition into an elastic enterprise.

Read part I of the two-part series on creating elastic architectures. For further details and some real-life examples, please read our whitepaper 'Creating Elastic Digital Architecture' (PDF). Also visit Cognizant's IT infrastructure services practice for more insights.

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Creating Elastic Digital Architectures: Part II