A report on a flat infrastructure required for a flat world floated past my desk relating of course to Thomas Friedman's book, the World is Flat. It is a very good book, strongly recommend anybody who hasnt noticed the harsh and fast moving winds of globalisation sweeping the globe. But all that is fine, what Friedman doesnt talk about and what people are a bit unclear on as to what kind of structure should a firm adopt so as to take advantage of this flat world at best and at worst, to deal with customers who are operating in a flat world?
Now you will ask me, what do you mean by structure? well, there can be many different dimensions to this structure. You can talk about a tax structure, a legal structure, an organisational structure, an IT structure, a process structure, and so on and so forth. And in a blog post, one cannot go that far. And I am not going to touch the Tax elements. And not the legal bits. And not the HR aspects. Dont know anything about those things, they make my hair hurt. But let me home into something that is the most difficult. Re-arranging your organisation is relatively easy, you just arrange for a matrix organisation so that you have global product or functional responsibilities while you have local/regional/continental client facing dimensions. Or you can just have one or the other, depending upon the size of the company and the products which you offer. Process architecture/structure is a bit more difficult but given sufficient technical support and big fat pipes, you can do it.
But the main challenge comes from having a good IT global firmwide architecture which can help you manage a flat world. Within financial institutions, I have seen this kind of flat world architecture only for similar products or limited scope, like a global system for foreign exchange trading, or for swift processing. Limited product/process architectures. If anybody comes and tells you that its possible to have a single all singing dancing architecture which can do everything, then they are selling you a pipe dream.
While an enterprise architecture looks good on powerpoint or a wall chart, it is almost impossible to achieve in real life. So the best you can achieve for a global financial institution is what I call as a multiple ladder structure. Imagine one ladder and stand it up. One leg of the ladder is one product chain. the other leg of the ladder is another product chain. The rungs are the inter-connections such as a common CRM, a common reporting engine, a common risk engine, a common operations engine, a common confirmations engine, a common payments engine, etc. etc. Now get another ladder and knock out one leg and fix it to the first ladder, so you end up with a ladder with 3 legs. And so on and so forth. Of course, the number of rungs will differ depending upon the product and function but if the world is flat, then your firm has a superimposed grid of this multi ladder structure. If you want to add another country to the firm mix, then extend the legs. If that country has a unique function (like specific reporting requirements, or like switzerland, wouldnt allow data to go outside), then extend/modify the rungs. Best of luck!
Some extracts from this vendor report is given below.
However, while today’s world has now been famously reconceived by journalist Thomas Friedman as "flat"—in terms of the ease with which global competitors can seize opportunities and the ways in which you can reach out with greater ease to suppliers and customers—most likely, your IT infrastructure is still geared to old round-earth notions and priorities. In other words, it’s not as flexible, adaptable and powerful as it should be to keep you competitive. And simply spending more or adding bells and whistles isn’t the answer.
Enterprise architecture addresses a variety of areas and can include:
• Models of business processes, data, systems and technology
• Descriptions of the data that make up these models
• Traceability to the goals and objectives of the organization
• Visible standards upon which the architecture is built
• Ability to visualize and share information easily across the organization
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