Business Model Generation and BA

I start with this question: “Is Business Architecture (as well as EA) only for the old and the flabby?” By that I mean old and flabby enterprises, not old and flabby architects! I would say (and I would love to see counter evidence) that the practice of BA and EA has been concentrated on the larger institutions among us – the Fortune 1000 corporations, the mandated practices in Federal and State governments in the U.S., etc.

Just for the sake of argument, wouldn’t it be refreshing if it were to turn out that good architecting practices can be applied effectively to young enterprises on their way up the growth and maturity cycle – a sort of nurturing practice, rather than strictly governance and remediation?

It turns out that there actually is such a practice, and it is creating a lot of buzz in the entrepreneurial community. I say “such a practice” even though I doubt its leaders and practitioners think of themselves as business architects or enterprise architects. There has been a bit of discussion about the synergy among these practice areas on the #bizarch, #busarch, and #entarch hashtags, and I think it’s worth pursuing.

So what is this mysterious practice? It is exemplified in a book called Business Model Generation, by Alexander Osterwalder and Yves Pigneur. In a nutshell, the approach is a kind of guided brainstorming through the issues that confront new and young enterprises, such as their offerings, markets, partner webs, etc. The heart of the method is a standard “canvas” that lays out the big issue areas, to be filled in by the combination of decisions, initiatives, and structures that the entrepreneurial team is working itself through in the early phases of the enterprise.

As Dave Britton says in his newsletter, “The Business Model Canvas offers you powerful, simple, tested tools for understanding, designing, reworking, and implementing business models … to systematically understand, design, and implement a new business model — or analyze and renovate an old one”The reason I bring this up on this forum is that I regard this as a form of Business Architecture (capital B and A as befits a professional formality). This is business architecture for the young and fresh, in the sense of architecting vital aspects of the enterprise from its very inception.

A start-up is not a Mini-Me version of its later self as an established company. A start-up is more like an infant human than like a tiny corporate titan. The organization structures and processes appropriate in the early days should be structures and processes that lead to the next level of maturity and growth, and the next, and the one after that. So the kind of conceptual framework offered by the Business Model Generation approach is all about setting enterprises off on a productive path, supported by structured but open thinking cultivated by Osterwalder’s team and fans.

If companies start thinking architecturally about themselves in their infancy, they will be predisposed to have later success with more mature methods in the EA and BA playbooks (Steve Haeckel’s adaptive enterprise framework, Mary Adams and the knowledge factory, Verna Allee’s value networks, LEAN, ITIL, SOA, you name it). And, as a corollary, these other methods and intervention approaches will not be taken randomly or desperately, but rather developmentally within an overall understanding of the natural maturation process of any organization.

At a minimum, I think it is a fruitful investment of time for business architects to add Business Model Generation to their tool kits. It would also be nice to see the EA and BA practices spread into the ranks of the young and supple, and not simply as therapy for those at the head table of the long feast of institutional growth.

Doug McDavid is a Consultant with Delegata & WTRI. You can find additional information on the author at http://www.linkedin.com/in/dougmcdavid