In: Computer Science
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Enterprise architecture (EA) at American Express was the framework the organization used to align IT and the business. EA provided a common language for leaders to use to collaborate and transform the business. At American Express, enterprise architects were the change agents who streamlined processes and designed ways to more effectively do business using IT resources. In 2011, American Express was named an InfoWorld/Forrester Enterprise Architecture Award recipient for its EA practices. As American Express leaders considered new payment methods using mobile devices, the EA guided their progress.
Mobile payments were forcing the payments industry to review their practices and significantly transform the way business was done. The new business environment introduced additional complexity with the addition of new delivery channels and the need for shorter time‐to‐market of payment products and services. American Express’s business strategy for its payments products focused on delivering a “consistent, global, integrated customer experience based on services running on a common application platform.”
To achieve this goal, the EA team created reference architectures and road maps for standardized applications across the firm. This team then worked with multiple business solution delivery teams to create and manage the common application architecture and create strategies that facilitated each business’s objectives. Each strategy included a road map of initiatives that included a set of actions, the metrics to evaluate the success of these actions, and the commitments IT and the businesses made to make it happen. The road map was American Express’s way to standardize language, tools, life cycle management of the applications, and architecture and governance processes. The elements of the road map included technology, reference architecture, and capabilities for the business.
The next steps for American Express were to extend the road maps to cover the maturing of SOA and to develop new reference architectures and a new taxonomy to increasingly align IT with the needs of the business. As new technologies emerged and new ways of doing business over social tools created opportunities for new payment products and services, American Express expected to continually evolve its EA.
Discussion Questions
1. What are the key components of the architecture American Express has created?
2. Why was it important to standardize so much of the architecture? What are the advantages and disadvantages of a standard EA for American Express?
1. What are the key components of the architecture American Express has created?
The key components of the architecture American Express created are:
Enterprise architecture (EA) serves two main purposes: to provide a framework for collaboration between business and IT and to offer a pivot point for transformational change.
The EA practice has successfully addressed the needs of the business by delivering reference architectures and road maps that promote standardized application architectures, facilitate innovation, and enable rapid product development. In partnership with portfolio architects, the EA practice manages application architecture across multiple business solution delivery teams and develops business-aligned IT strategies. Each strategy contains a road map of initiatives that translates to measurable action and IT commitments to the business.
Road mapping is a core planning competency for architecture, engineering, service, and operations. It supports such business and IT goals as service management, portfolio simplification, prioritization, and IT-business alignment. Using a common tool, a consistent lifecycle management standard, and a standardized architecture governance process, three types of road maps are created:
American Express's reference architectures have enabled business solution delivery teams to bring products and services to market faster by reducing infrastructure procurement and provisioning from months to a matter of days and, in some instances, hours. The use of reference architectures has resulted in fewer service outages, increased standardization of infrastructure, improved mean time to repair, and a dramatic decrease in support costs.
2. Why was it important to standardize so much of the architecture? What are the advantages and disadvantages of a standard EA for American Express?
A Standard Architecture(SA) is a high-level document that outlines a set of criteria for your team’s technology stacks to follow. Ultimately, SA should speed up development cycles, increase consistency across all codebases, and help with ramping up new developers. An SA should be created by the team and not by a single individual.
The EA standard architecture provided the wide range of flexibility in terms of mobile payments. This was huge change in dynamically shifting industry.
There are basically 3 main configuration of IT architecture:
The EA architecture is centralized. The use of this model played a very important role in the development cycle. As the data is controlled at the singe place then distributed according to mobile or non mobile payment.
Advantages and disadvantages:
An advantage of standard enterprise architecture for American Express includes the ability to provide more consistent user experience. In addition, standard enterprise architecture use can deduce risk and exposure and reduce operating costs. Optimally it will allow product and services to be brought to market more quickly.
Disadvantages of standard enterprise architecture include the concept that architecture must guide rather than dictate. The architecture process must seen as a "fit" for the employees and customers of American Express. It should be value to projects and be accepted on its own merits. It must also serve a mission: in this case American Express has a strategic need for enterprise architecture that addressed the specific need of shorter time to market products and services and new delivery changes like mobile devices.
Another disadvantage is that increased costs can be incurred if the system is not properly managed. Since architecture must guide rather than dictate an organization it is key that the company's strategy actually drives the architecture. IT must carefully manage the architecture to ensure that it is being managed in this manner, rather than having the company be limited by the architecture or guided by the architecture based on its perimeters, rather than careful planning of the needs of the organization.
Also some of the other issues which happened while dealing with EA are:
The EA proved out to be big advantage only. Despite of these disadvantages, things were very well handled then some corrections were also made to deal with it.