A business architecture is a part of an enterprise architecture related to corporate business, and the documents and diagrams that describe that architectural structure of business. People who build business architecture are known as Business Architects.
Business architecture bridges between the enterprise business model and enterprise strategy on one side and the business functionality of the enterprise on another side.
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The term "business architecture" is, first of all, an architecture and used to refer to an architectural organization of an enterprise or a business unit, architectural model or profession. A formal definition of the first meaning is defined by the Object Management Group's Business Architecture Working Group as follows:
Business Architecture articulates the functional structure of an enterprise in terms of its business services and business information. The business capability is ability to perform certain business functionality and deliver business results or values. The business capability is provided by business services that state "what" the organization does while the business processes implement business functionality and define "how" the organization can execute its capabilities. By following the governance and articulating business information, the business architecture considers all internal and external actors to an enterprise (including its customers, suppliers, and regulators), to ensure that flow in and out of the enterprise are captured.
In order to develop an integrated view of an enterprise, many different views of an organization are typically developed. The key views of the enterprise within the business architecture are:[2]
In addition to the above views of the enterprise, the relationships connecting the aforementioned views form the foundation of the business architecture. This foundation provides the framework that supports the achievement of key goals; planning and execution of various business scenarios; and delivery of bottom line business value.[2]
Business Architecture is a disciplined approach to realise business models and to serve as a business foundation of the enterprise to enhance accountability and improve decision-making.
Business Architecture's value proposition, unlike other disciplines is to increase functional effectiveness by mapping and modeling the business to the organization's business vision and strategic goals.
Business Architecture directly realizes business strategy. It is the foundation for subsequent architectures (strategy embedding), where it is detailed into various aspects and disciplines. The business strategy can consist of elements like strategy statements, organizational goals and objectives, generic and/or applied business models, etc. The strategic statements are analyzed and arranged hierarchically, through techniques like qualitative hierarchical cluster analysis. Based on this hierarchy the initial business architecture is further developed, using general organizational structuring methods and business administration theory, like theories on assets and resources and theories on structuring economic activity. Based on the business architecture the construction of the organization takes shape (figure 1: strategy embedding). During the strategy formulation phase and as a result of the design of the business architecture, the business strategy gets better formulated and understood as well as made more internally consistent.
The business architecture forms a significantly better basis for subsequent architectures than the separate statements themselves. The business architecture gives direction to organizational aspects, such as the organizational structuring (in which the responsibilities of the business domains are assigned to individuals/business units in the organization chart or where a new organization chart is drawn) and the administrative organization (describing for instance the financial reconciliation mechanisms between business domains). Assigning the various business domains to their owners (managers) also helps the further development of other architectures, because now the managers of these domains can be involved with a specific assigned responsibility. This led to increased involvement of top-level management, being domain-owners and well aware of their role. Detailed portions of business domains can be developed based on the effort and support of the domain-owners involved. Business architecture therefore is a very helpful pre-structuring device for the development, acceptance and implementation of subsequent architectures.
The perspectives for subsequent design next to organization are more common: information architecture, technical architecture, functional architecture. The various parts (functions, features and concepts) of the business architecture act as a compulsory starting point for the different subsequent architectures. It pre-structures other architectures. Business architecture models shed light on the scantly elaborated relationships between business strategy and business design. We will illustrate the value of business architecture in a case study
Rows 1 & 2 of the Zachman Framework deal with Business Architecture discipline.
Modeling standards of the Object Management Group (OMG), including the Unified Modeling Language (UML), Model Driven Architecture (MDA) and the Business Process Modeling Notation (BPMN), enable powerful visual design, execution and maintenance of software and other processes, including IT Systems Modeling and Business Process Management.
The OMG established the Business Architecture Working Group[3] (BAWG) in December 2007 to pursue the development of standards to support the Business Architecture community. The group has begun an effort to catalog business scenarios and to capture a library of business techniques that will be used to isolate and prioritize areas of work. This initiative has as a key part of its mission the interlinking and unification of existing standards to accommodate the demands for integrated end-to-end business analytics. The BAWG conducted a Business Architecture Information Day on September 23, 2008 in Orlando at the OMG's quarterly Technical Meeting as part of an outreach effort to bring interested practitioner and vendor organizations into the standards process.
The Open Group Architecture Framework of the The Open Group is a community-based effort for describing methods and tools used by architecture. It is being developed and continuously improved by the Open Group, a consortium of interested individuals and companies involved in information technology.
Although the Open Group limits their framework to be used to develop Information Systems only, their framework includes “Business Architecture” as one of the four "domains" of architecture. The other three domains are Application Architecture, Data Architecture and Technology Architecture. TOGAF describes business architecture as "the business strategy, governance, organization, and key business processes".[4]
A Business Architecture describes the functional aspects of the business domain instead of the IT domain. TOGAF defines four dimensions, three of which can be considered relevant to Business Architecture:
A framework for denoting Business Architecture is the xBML (eXtended Business Modeling Language) framework. This framework advocates the following Business Architectural components:
Additionally, xBML provides a detailed "instruction set" (or formal rule set) that enables the practitioner to build content for the framework in a consistent, repeatable and verifiable manner. There are approximately 55 rules that ensure consistency in output generated, unlike other frameworks available.
Industry reference models are frameworks or models that provide a best practice off-the-shelf set of structures, processes, activities, knowledge and skills.