A Methodology for Operationalizing Enterprise Architecture and Evaluating Enterprise IT Flexibility

We propose a network-based methodology for analyzing a firm’s enterprise architecture. Our methodology uses “Design Structure Matrices” (DSMs) to capture the coupling between components in the architecture, including both business and technology-related elements. It addresses the limitations of prior work, in that it i) is based upon the actual architecture “in-use” as opposed to planned or “idealized” versions; ii) identifies discrete layers in a firm’s architecture associated with different technologies (e.g., applications, servers and databases); iii) reveals the main “flow of control” within an architecture (i.e., the set of inter-connected components); and iv) generates measures of architecture that can be used to predict performance. We demonstrate the application of our methodology using a novel dataset developed with the division of a large pharmaceutical firm. The dataset consists of all components in the enterprise architecture, the observed dependencies between them, and estimated costs of change for software applications within this architecture. We show that measures of the architecture derived from a DSM predict the cost of change for software applications. In particular, applications that are tightly coupled to other components in the architecture cost more to change. The analysis also shows that the measure of coupling that best predicts the cost of change is one that captures all direct and indirect connections between components (i.e., it captures the potential for changes to propagate via all possible paths between components). Our work represents an important step OPERATIONALIZING ENTERPRISE ARCHITECTURE APRIL 21, 2015 Copyright © 2015, Alan MacCormack, Robert Lagerstrom, David Dreyfus, Carliss Y. Baldwin Working papers are in draft form. This working paper is distributed for purposes of comment and discussion only. It may not be reproduced without permission of the copyright holder. Copies of working papers are available from the author. in making the concept of enterprise architecture more operational, thereby improving a firm’s ability to understand and improve its architecture over time.