Building a Business Architecture Practice:
TIAA-CREF's Journey through Building a
Business Architecture Practice 03/20/2013
Shawn Furgason Senior Director
Business Architecture
2
TIAA-CREF Fast Facts
Institutional Retirement, Health Savings, Executive
Compensation, Planned Giving, Endowments, etc.
Individual Retirement (403b,401k,IRA),
Educational Savings, Insurance, Brokerage, Banking/Lending, Health
Savings, Trusts, Annuities, etc.
Asset Management Global Equities, Fixed Income, Real Estate,
Institutional Investing, Alternative Investments, etc.
1 As of September 30, 2012.
3
Vision 2020 – The Case For Change
Vision 2020 is TIAA-CREF’s long-term strategic plan to grow the company
through the end of the decade and beyond.
• Changing client demographics
• Offer products / services supporting a greater range of financial needs
Expand the products / services to the broader not-for-profit market
Employees at not-for-profit institutions we do not
currently serve
Households and families of current and future
participants
Diversify our offering building our relationship
across more of our participants
Realizing Vision 2020 required significant business
transformation and new ways to work across lines of business
4
Our Business/Technical Challenges Traditional Portfolio Planning Created Barriers to Realizing Vision 2020
Business
Drivers Vision and Objectives
Project
Level
Activities
Business Case/Initiation
Requirements
Design
Develop/Test QA
Implementation/Support
• Duplication of capabilities
• Insufficient strategic/operational funding
to delivery required capabilities
• Too much focus on foundational vs.
distinctive capabilities
• Increase in technical debt
• Project portfolios are
developed based on
individual Line of Business
requirements
• Projects are justified, funded
and executed based on their
own merit
Socializing the component based design was a key turning in point in
shifting the conversation from how to what we do as a business.
5
Business Architecture: Key to Achieving V2020 Capabilities Centric Execution Portfolio
Business
Drivers
Business
Architecture
Vision and Objectives
Business Strategy
Business Model
Business Capabilities
Business Process
Information Architecture
Information Management Reference Architecture
Applications Reference Architecture
Infrastructure Reference Architecture
Technical
Architecture
Project
Level
Activities
Business Case/Initiation
Requirements
Design
Develop/Test QA
Implementation/Support
Portfolio
Management Capability Portfolio People Information Technology Process
6
Business Architecture Was Born
• Enterprise Architecture Introduces Component Based Design
– IBM’s Component Business Model (CBM)
Socializing the component based design was a key turning in point in
shifting the conversation from how to what we do as a business.
7
TIAA-CREF shifts from the CBM to Business Capabilities Map
• The CBM never resonated with
business leaders
– Too abstract
– Separation of Plan, Control, Execute
• Developed a multi-tiered Business
Capability Map (BCM)
– Functionally organized
– Vetted with a broad cross section of business
• Applied the BCM
– Every project undergoing an Enterprise Architecture Solution Definition Review
– Produced historical capability investment heat maps
– Produced the first forward looking portfolio investment heat map
Servicing & Recordkeeping
Investment Management
Enterprise Services
Business Management
Products & Services Management
Financial
Mgmt
Marketing and Sales Management
Client
Relationships & Experience
Risk Mgmt
Level 1
Servicing & Recordkeeping
Investment Management
Enterprise
Services
Business Management
Product & Service Management Financial
Management
Marketing, Sales & Distribution Channel Mgmt
Client Relationships &
Experience
Risk Management
Servicing
Strategy
Client
Relationship
Strategy
Investment
Strategy
Risk
Management
Execution
Risk Planning
Governance
Product Development
LifecycleProduct Strategy
Servicing
Management
Servicing & Recordkeeping
Administration
Investment
GovernanceTrading & Settlement
Information Technology
Product Portfolio
Management
Marketing,
Sales &
Distribution
Channel
Strategy
Marketing
Execution
Marketing,
Sales &
Distribution
Channel
Oversight
Sales
Delivery
Distribution
Channel
Execution
Human Resources
ManagementFacilities Management
Enterprise Strategy and Planning
Procurement
Management
Client
Relationship
Analysis
Client Experience
Financial
Strategy &
Planning
Risk
Management
Oversight
Financial
Execution
Financial
Oversight
Level 2
Enterprise
Services
Human Resources Management Facilities Management Information Technology
Human Resource Strategy
Facilities Mgmt & Operations Technology Delivery & Operations
Technology Strategy & Planning
Document, Image & PrintTalent and Resource Mgmt
Resource Acquisition & Retention
Procurement Management``Vendor and
Partner Strategy
Sourcing & Procurement
Vendor and partner
Management`
Servicing & Recordkeeping
Investment Management
Business Management
Product & Service Management Financial
Management
Marketing, Sales and Distribution Channel Mgmt
Client Relationships &
Experience
Risk
ManagementProduct Development LifecycleProduct Strategy Product Portfolio
ManagementProduct & Service Portfolio
Strategy
Product & Service Contribution Strategy
Product & Service Sourcing Strategy
Product & Service
Sourcing
Product & Service Dev, Configuration & Pricing
Product & Service Filing
Product & Service Profile
Product & Service
DeploymentProduct & Service Performance
Tracking
Product & Service Lifecycle Oversight
Financial Strategy &
Planning
Capital & Reserves Strategy
Accounting & Allocation Strategy
Treasury & Cash Strategy
Risk Strategy
Corporate Risk and Controls Strategy
Portfolio Risk Strategy
Compliance and Regulatory Strategy
Marketing, Sales
& Distribution
Channel Strategy
Branding & Competitive Positioning Strategy
Marketing & Sales Strategy & Planning
Distribution & Channel Strategy & Planning
Marketing
Execution
Market Research & Analysis
Marketing & Advertising
Campaign Planning & Execution
Marketing, Sales &
Distribution
Channel Oversight
Distribution Channel Effectiveness, Oversight &
Management
Marketing Advertising & Campaign Effectiveness
Sales Effectiveness,Oversight & Management
Client Relationship
Strategy
Client Experience
Client Relationship
Analysis
Client Relationship and Experience Strategy
Segmentation Strategy and Planning
Client Advisory Service Strategy
Client Activities & Events
Communications and Correspondence
Client Advisory Services
Touch Point Handling
Client Profile
Client Lifecycle Management
Client Value Management
Client Service Performance Management
Touch Point Management
GovernanceEnterprise Strategy and PlanningExternal Relations
ManagementBusiness Performance
ManagementPolicies , Architecture & Standards Governance
Enterprise Business Strategy & Visioning
Continuous Process Improvement
Sales Delivery
Sales Execution
Sales Enablement
Servicing Strategy Servicing
Management
Product Delivery & Servicing Performance Mgmt
Product Delivery & Servicing. Audit & Exception Handling
Eligibility, Enrollment & Delivery Oversight
Servicing & Recordkeeping Administration
Plan, Product, Portfolio & Service
Performance
Plan Lifecycle Management
Contributions &
Remittances
Benefits, Payouts &
Claims
Eligibility, Enrollment & Entitlement
Billing & Collections
Positions & Balances
Accounts & Contracts
Lifecycle Mgmt
Statements & Reports
Investment Strategy
Investment Philosophy
Investment Planning
Investment Strategy
Investment
GovernanceAllocation & Trading
Oversight
Portfolio Performance Analysis & Oversight
Portfolio Performance Benchmarking
Trading, Settlement and Asset Management
Portfolio Asset Allocation & Balancing
Investment Decisioning &
Trading
Research & Analytics
Investment Ops, Custody, Clearing
& Settlement
Investment Perf. Reporting
Investment Valuation
Investment Accounting
Transfer Agency
Risk Management
Execution
Risk Management
Oversight
Product Risk Management
Market &Credit Risk Mgmt
Operational Risk Mgmt
Legal
Security &Privacy Mgmt
Fraud Detection & Mitigation
Actuarial &Underwriting
Portfolio Risk Oversight
Corporate Risk Oversight
Compliance Oversight
Financial Execution
Financial Oversight
Treasury & Reserves Management
Finance & Accounting Controls
General Ledger Operations
Internal Mgmt / External Reporting
Accounts Payable
Treasury & Cash Flow Operations
Financial Performance Measurement & Reporting
Strategic Planning
Distribution
Channel
Execution
Distribution Channel Profile
Distribution Channel Compensation
Enterprise Business Strategy Development
Case & Exception Handling
Product Delivery & Servicing Strategy & Design
Product Delivery & Servicing Cost Strategy
Product Delivery & Servicing Policies & Procedures
Loan Fulfillment
Budgeting, Planning & Forecasting
Accounts Receivable
Legal Strategy
Audit and Process Assurance
Regulatory Compliance
Audit Oversight
Legal OversightAsset
ManagementAcquisition & Disposition
Level 3
Level 4
Business Component Names Associated Capabilities
Touch Point Handling
• Manages all inbound and outbound contact handling activities between the company and all applicable parties (including exceptions)
• Records interactions with clients via one or more access channels & the internal actions taken as a result
• Manages the classification and activities of internal/external client interactions
• Administers all client interaction routing per established client handling rules
• Handle the client dialogue and provide response• Authenticates user credentials
Business stakeholders must be able to see and
describe their business using the model to accept it.
8
IT & Business Partner to Develop Business Architecture
• The CIO and COO Partner to develop Business Architecture
– Institutionalize Capabilities Orientation
– Establish a Center of Excellence
– Integrate into Business Cadence
– Strategy -> Execution Linkages
• Partnered w/ Booz & Co
– Capabilities Driven Strategy
– Coherence Concept
– Distinctive Capability System
– Resonated w/ Executives
– Resisted by Sr. Leaders who
were more focused on closing
gaps in foundational
capabilities
Right to
Win
How are we going to create value for our customers in this market?
What do we need to do well to deliver that value proposition?
What are we going to sell in this market and to whom?
9
Business Blueprints to Strategy Implementation
Capability Blueprint,
including overlays of: – Products and
Services – Cost structure – Investment – Ownership – Cost Model – Risk
Blueprint of the Business Strategy Implementation & Reporting
Capability Analysis – Health and Parity – Gap Assessment
Capability Roadmap – Initiative Roadmap
and Investment Prioritization
– Business Case
Way to Play Capability Definition
Strategy
1
2
3
The complexity of the linkages between capabilities, process,
people, and technology requires a supporting data model
10
Pilots Uncover Strategy Gaps and Alignment Issues
• Traditional LoB strategies and execution were strong but generally not aligned
with the overall vision of the firm
• One executive challenged the business strategy for their business unit,
designed a new strategy, and obtained CEO / board approval
• Most investments were not developing “strategic” or “differentiating”
capabilities
• We experienced difficulties between functional capability alignment and the
distinctive capability system
• Sr Business leaders aligned with functional capabilities while executives
aligned with the distinctive capability system
• The business architecture engagement was redirected to focus on the largest
business unit and to align our work with LEAN process re-engineering efforts
Anticipate gaps in strategy and prepare to
work through the gaps or quickly redirect.
11
Capability to Process Linkage Model
1. Business Architecture Common Language:
A Capability represents WHAT we do and
serves as a common process classification
language. A Process is one element of HOW
we deliver value (along with people, technology
and information).
• Level 1 Capabilities serve as Process
Categories (APQC* L1)
• Level 2 Capabilities serve as Process
Groups (APQC L2)
2. Business Contextual Dimensions allow us to
transition from Capabilities to Physical
Processes. The three key business contextual
dimensions are Customer, Product, and
Channel.
3. Physical Processes must be measurable and
assignable and are documented at one of next
three APQC layers within a specific business
context
• Level 3 Process/ Activity (End to End –
Voice of Customer Value Stream
• Level 4 Activity / Task / Step (Standard
Work, commonality opportunity)
• Level 5 Task / Step / Data (Procedures)
* APQC - American Productivity & Quality Center
12
Business Capability Model L1 Capability and Contextual Dimensions
Operations &
Administration Client Servicing Onboarding Sales
Client Relationship & Experience Management
Marketing
Data Analytics & Information
Technology Risk, Fraud, Law &
Compliance Human Resources
Management
Finance, Accounting &
Vendor Management
Facilities Management &
Operations
Governance & Program / Change
Management
Strategic Planning & Business Modeling
Co
nte
xtu
al D
ime
nsio
ns
F
ou
nd
ati
on
al
L1
Busin
ess C
ap
ab
ilitie
s
Busin
ess C
onte
xt
Investment Management
Product
Management
Va
lue
Ch
ain
Client Types Individual / Participant Institution / Sponsor
Dollar Stretchers Life Builders Accumulators Transitions Established Premier / Jumbo Partner / Large & Medium Direct / Small
Mass Affluent High Net Worth Higher Ed K-12 Hospitals Government
Product Lines Individual Products Asset Management Institutional Products
Life Insurance (Term & Perm)
Education Savings
Brokerage Checking Loans Mutual Funds
Planned Giving Trusts
Retirement Plans
Retirement Health Svgs Plans
Non-Qual. After Tax Annuities
Personal Trusts
Managed Accounts Savings & CDs Real Estate
Secured Loans Annuities Accounts Endowments
Executive Compensation
Deferred Compensation
Ind. Retirement Accounts (IRAs)
Prepaid Cards Management /
Advisory Services
Channels TIAA-CREF / Partner Channels
Internet (Dot Com, Social, Chat)
Authenticated (Online, Chat, ATM)
Mobile Email
(Out /In) Inbound Calls /
IVR Inside Sales
(Outbound Calls) High Touch Sales
(Wealth, FCG, etc.) Intermediaries
Specialized Sales & Service
Mail / Image /Fax
OGSM
13
Business Architecture Value Propositions Durable, Model Driven Approach
Business Architecture Framework
Operational Excellence
Customer Experience
Portfolio Optimization
A durable, model driven approach is the key to analyzing, managing and
optimizing the design of TIAA-CREF’s increasingly complex business
Each engagement leverages
the knowledgebase speeding analysis and reducing
cost/effort
Engagements builds upon
the depth and breadth of the knowledgebase
Layer maturity
development effort immediately benefits
the engagements
Process Complexity Technology Complexity
Vendor Analysis & Leverage
Employee Productivity Onboarding and Experience
Customer Experience Consistency
Competitive Parity (Product, Channel and Service)
Gap Ranking
Competitive Advantage
Cross Portfolio Impact Strategic Portfolio
Outcome Alignment
Cross Portfolio Collisions –
Efficient Execution
14
Business Drivers Define the overall purpose for analyses
Business Drivers:
• Provide the underlying
business purposes for
defining an analysis’
scope
• When linked to Process
Patterns, insights can be
gained around: • Competitive Advantage
• Competitive Parity
• Project Change Impact
• Gap Ranking
• Strategic to Portfolio
Alignment
• Customer Experience
• Risk Alignment
Process Pattern
Customers
Market Group
Segment/Sector
Sub-segment
Business Capabilities
Level 1 Capability / Process Group
Level 2 Capability / Process Category
Level 3 Capability/Process
Products
Product Group
Product Family
Product
Channels
Channel Method
Channel Type
Channel
Activity
Task
Step
Linking and Leveraging:
When each Business Driver is linked to defined
Process Patterns we will be able to provide
further insights into Business Enablers linked
to the same Process Patterns. For example: • Process efficiency opportunities
• Operational complexity
• Operational costs
• Vendor analysis
15
Process Patterns The Hub for Business Insights
Process Pattern
Customers
Market Group
Segment/Sector
Sub-segment
Business Capabilities
Level 1 Capability / Process Group
Level 2 Capability / Process Category
Level 3 Capability/Process
Products
Product Group
Product Family
Product
Channels
Channel Method
Channel Type
Channel
Activity
Task
Step
Process Patterns :
• Define a common
vocabulary and
methodology for
organizing business
processes across any
combination of product,
customer and channel
dimensions
• Provide the “connective
tissue” that links
Business Drivers (Strategy, Change Programs,
Risk, and Gaps) to
Business Enablers (People, Technology and
Information)
16
Business Enablers Provide the underlying data for analysis
Business Enablers:
• Represents the
components utilized to
support company
processes/capabilities
• Each “layer” provides
details and attributes
which deliver insights into
HOW (and how well)
processes are being
supported (or could be
better supported) from an
organizational and
technology infrastructure
• Each Business Enabler
is linked to each Process
Pattern component at
defined levels
Process Pattern
Customers
Market Group
Segment/Sector
Sub-segment
Business Capabilities
Level 1 Capability / Process Group
Level 2 Capability / Process Category
Level 3 Capability/Process
Products
Product Group
Product Family
Product
Channels
Channel Method
Channel Type
Channel
Activity
Task
Step
Examples of Data
Requirements captured and
stored for each “Layer”
Technology
Description
Lifecycle stage
Business Health
Tech Health
(complexity an
attribute)
Run cost
Platform Owner
Host
(internal/external)
Information
Segment
Quality Rating
SOR Flag
Required data
elements
People
Sourcing (Internal,
Outsource/Contractor,
Offshore)
Required Skill Set
Engagement Level
Location
Coverage hours
Costs per employee
Enablers
People
TIAA-CREF
Organization / Legal Entity
Department / Group / Team
Role / Job
Skill / Competency
Technology
Business Platform
Business System
Application
Information
Library
Collection
Group
Vendor
Location
Region
State
County
Fascility
Country
17
Where We Are Now
• Preliminary mapping of the 2013 Strategic Investment Portfolio
– Key insights: Collisions, Efficiency opportunities, Readiness / Impact Assessment
• Model Applied to Business Engagements
– Helping visualize technical and process complexity.
– Process optimizations appear to return 10x the value of technical platform
simplification
• Model / Reporting rapidly produces insights and enables “pivoting” on any layer
– Process, Technology
• Dramatic reduction in analysis time
– Leverage model for focused analysis
– Estimate a 40-60% reduction in analysis effort – focus expensive consulting resources
• Developing the depth and breadth of the model
• Adoption of “Capabilities” in addition to “Process”
• Pull vs. Push
18
Looking Forward
• Technical Roadmaps are truly Business Driven / Prioritized
• Business Architecture as a key foundational component of a new business
strategy
• Integrated Process Pattern Mapping into 2014 Planning
– All 2014 projects will identify process patterns before funding consideration
– Influence the design of the investment portfolio
– Influence / structure the execution portfolio (stretch)
• Operationalize the data model
– Add quantitative measures & data to qualitative
– Process optimizations appear to return 10x the value of technical platform
simplification
• Integrate Business Architecture into every major consulting engagement
• Revisit strategic / differentiated capability
19
Business Architecture Challenges & Lessons Learned
• Top-down Business Architecture
exposes strategy gaps
• LoB vs. the Enterprise value
• Difficulty of business leaders to
see value in an abstract concept
• Delivery teams can be threatened
• Business engagement is critical
• Business resistance
• The “right level“ of tool support is
critical
• Nuances of capabilities
• Skilled / experienced Business
Architects are difficult to find and
grow
• Business expertise matters
• Where your team reports matters
• Work through the strategy gaps or
course correct quickly
• Deliver LoB value first
• Find and support partners and
advocates
• Engage delivery teams
• Educate and engage at all times
• Demonstrate value quickly
• Simple databases/models and
avoid PowerPoint hell
• Get “close enough” and move on
• Be patient for the right skills,
leverage peer groups, grow your
own
• Consider senior business leaders
• Align reporting to objectives of BA
Challenges Lessons Learned
Ap
pro
ach
To
ols
Te
am
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