The failure of many major corporations a few years ago, which drove a bunch of new compliance laws and shareholder lawsuits, could also be leading to the reality that shareholders are looking at enterprise architecture efficiencies, along with accounting and reporting practices.

At issue is the fact that many major public companies don't have efficient enterprise architectures, and thus the business is unable to adapt to new market opportunities, reuse key IT assets, and thus not provide the maximum return to shareholders. Therefore shareholders have a large stake in existing enterprise architectures, and those that are still static and inflexible, due to a lack of proper strategic planning and use of technology (e.g., SOA), could find themselves explaining their enterprise architecture issues during depositions, not at technology conferences.

Those that own stock in a major corporation assume that the IT departments, and thus the architects, are doing their level best to make sure that the architecture is optimal for the business. However, in many cases, that's not true. Years and years of neglect, and in many instances lack of talent and understanding have created enterprise architectures that look like dysfunctional super highways within the enterprise, with so many layers of complexity, and so much fragility, that the business is unable to integrate easily with new partners, stand up portals, provide customer services, and other key business processes that are needed to make the business efficient and revenue generating in a timely manner. In many instances, it takes months to change major business processes, and as such, IT is hindering the success of the company. In essence, years and years of poor planning and bad architecture has created an IT infrastructure that is hindering the corporations ability to make money, thus return value to shareholders, thus could drive lawsuits.

While SOA is often pushed as a fix for poor enterprise architecture, the truth is that many companies are just purchasing ESBs or application servers, bolting them on, and calling it day. By doing that you're actually making the architecture worse by making it more complex. Needed, is a long term cogent SOA strategy that includes breaking the current architecture down to its component parts, and building it up again as something that is much more efficient, and thus revenue generating. SOA is something you do, not something you buy. It's complex, hard, but worth it if you do it correctly.

So, considering that some companies don't have good enterprise architectures, and therefore they are not optimized to return value to the shareholders, and are not doing SOA or doing SOA properly, the shareholders my take aim at IT asking that a complete audit be done on the methods and practices in building an effective enterprise architecture, and ask key questions that many IT organizations would not want to answer.

I suspect this is going to become more of an issue in 2008, as some organizations that get SOA are able to return provable value to the shareholders, and those that don't get SOA, are not. Moreover, those that fail at SOA are even in worse shape, since they have actually gone backwards in some instances, spending money and just adding complexity.

The moral of this story is to get your architecture right now, else deal with angry shareholders and boards of directors that will find other people that can do it for you.

Posted by Dave Linthicum on September 13, 2007 05:21 AM