Elements of an operating model

4.2.5.1 The general operating model

The current operating model has been analysed from the point of view of four basic dimen­

sions. Each dimension has a corresponding community where engagement takes place. This form of analysis let us understand the organisation, mid and long term plans, process and road maps, the strategy, the relationships and communication to communities of a certain opera­

tion. The general operating model is generic and applies to any kind of operating model. The basic model is shown in figure 4.9.

Figure 4.9 Dimensions of a general operating model

The dimensions (with corresponding community) and typical questions (sample) are:

1. Authority (stakeholder community)

• Who are the stake­ and shareholders?

• Where do ideas of the model come from, who are the innovation drivers of the model?

• How is the future of this operating model, this division seen from senior manage­

ment of the company?

• Compliance and conformance questions?

• ...

2. Competency (peer community)

• How are competencies developed?

• Is there a peers community of the competency?

• Who are our peers, the subject matter experts, the competitors and how does their operating model look like?

• ...

3. Enabling (supplier community)

• Who are the partners of the operating model?

• How do we engage our suppliers?

• Do we have a choice?

• ...

4.2 Preliminary study in the context of a bank | 57 4. Capacity (market community)

• What is our value proposition?

• Who are the customers?

• How is this market structured?

• ...

4.2.5.2 Architectures

The bank provided an internal document calledBusiness Transformation Design Method, a state of the art approach for architectural design of their business operations and IT alignment.

With the analysis of the business operating model of this division, the greater context of the Swiss Bank should also be taken into consideration. This has not been done in the review since it would lead too far to answer the questions of the mandate. The operating model is a key information in order to to find the best strategic fit between the business and the use of IT.

Therefore the focus was set on business architecture. Figure 4.10 shows four different levels of architectures. These architectures can be seen as abstraction layers of the business. The strategic direction level has been considered as part of the STS Platform Management. The second layer, the business architecture level should be managed by the operations unity itself, the CTS ­ Collateral Trading Services. The third layer, the application architecture should be done by the IT supplier. The fourth layer, however shall be under control of IT infrastructure services of the Swiss Bank. Layer four did not play that important role for the analysis. Of course, there must be an alignment between these four abstraction layers in a useful form.

All responsible should have an awareness and understanding of these plans. Plans must be the basis of communication. Be clear and understandable on an abstract level.

4.2.5.3 Finding

In search of optimisation potentials, it is helpful to understand its divisions embedding into existing bank architectures. All roles with budget responsibility should be aware of questions of architecture and the embedding into a greater context. Figure 4.10 show the first three levels from Figure 4.11 of the so calledBanks Architecture Framework. This figure shows the big picture with all architectures enclosed from two governances. From strategic point of view, theses architectures of IT Governance should be taken into consideration from STS, Platform Management.

Business Architecture links Business Strategy with execution (iterative process)

Business Architecture

Application Architecture

Infrastructure Architecture

Business Architecture identifies and shapes business capabilities, processes and supporting resources in order to allow the business to execute its strategy.

The Application Landscape identifies and describes the high level IT functions and their interactions in support of the Business Architecture. The analysis of the existing application identifies alignment issues with the business architecture as well as gaps and overlaps.

Implementation happens by mapping IT functions with respect of their required Qualities of Service (throughput, availability, security etc.) to the IT Infrastructure

Strategic Direction

Strategic Direction defines the target markets, how to differentiate from competitors and the goals and objectives (both qualitative and quantitative) of the business for the area in scope.

EmpiricalstudiesondesigningforconsistencyofevaluationinEGIT

Figure 4.10 Business architecture links business strategy with execution (internal document, with permission of the Bank (2011))

4.2Preliminarystudyinthecontextofabank|59

Figure 4.11 Banks architecture framework (internal document, with permission of the Bank (2011))

4.2.5.4 The business capability map

The next step was to examine the business architecture. Also at the Swiss Bank it is common practice to describe the capabilities of an operation by a so called Business Capability Map (BCM). The model very tightly maps to the dimensioncompetencyandcapacity, as also to the above mentioned architectures. Capabilities are the main source for building and/or defining the dimensioncapacity, the potential to offer a value proposition to the market. Figure 4.12 shows how architectures, capabilities, entities, processes and operational resources interact in the example of a SOA reference architecture.

Figure 4.12 Business capabilities with a SOA reference architecture (Ulrich & Rosen, 2011)

It is also a very good communication tool and allows those involved to gain an overview of their abilities.

4.2.5.5 Finding

For the analysed division, a BCM has existed some years ago. It was outdated and did not reflect the current state of the business. In addition to the architecture view the link to the capabilities of IT elements/components were either missing or not outdated as well. The rec­

ommendation was to apply an update to these architectures and link objects where applicable.

If not possible, to start from scratch. Figure 4.12 is an example how the linkage between the business and IT architectures could be shown. However, the figure is an example and does not reflect the situation at the Swiss Bank.

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