Building a Business Architecture Practice:
TIAA-CREF's Journey through Building a
Business Architecture Practice
03/20/2013
Shawn Furgason
Senior Director
Business Architecture
TIAA-CREF Fast Facts
Institutional
Individual
Retirement, Health Savings, Executive
Compensation, Planned Giving,
Endowments, etc.
Retirement (403b,401k,IRA),
Educational Savings, Insurance,
Brokerage, Banking/Lending, Health
Savings, Trusts, Annuities, etc.
Asset Management
Global Equities, Fixed Income, Real Estate,
Institutional Investing, Alternative Investments, etc.
1
As of September 30, 2012.
2
Vision 2020 – The Case For Change
Vision 2020 is TIAA-CREF’s long-term strategic plan to grow the company
through the end of the decade and beyond.
• Changing client demographics
• Offer products / services supporting a greater range of financial needs
Expand the products / services to the broader not-for-profit market
Employees at not-for-profit
institutions we do not
currently serve
Households and families of
current and future
participants
Diversify our offering
building our relationship
across more of our
participants
Realizing Vision 2020 required significant business
transformation and new ways to work across lines of business
3
Our Business/Technical Challenges
Traditional Portfolio Planning Created Barriers to Realizing Vision 2020
Business
Drivers
•
•
Vision and Objectives
Project portfolios are
developed based on
individual Line of Business
requirements
Projects are justified, funded
and executed based on their
own merit
•
•
•
•
Duplication of capabilities
Insufficient strategic/operational funding
to delivery required capabilities
Too much focus on foundational vs.
distinctive capabilities
Increase in technical debt
Business Case/Initiation
Project
Level
Activities
Requirements
Design
Develop/Test QA
Implementation/Support
Socializing the component based design was a key turning in point in
shifting the conversation from how to what we do as a business.
4
Business Architecture: Key to Achieving V2020
Capabilities Centric Execution Portfolio
Business
Drivers
Vision and Objectives
Business Strategy
Business Model
Business
Architecture
Business Capabilities
Business Process
Information Architecture
Information Management Reference Architecture
Technical
Architecture
Applications Reference Architecture
Infrastructure Reference Architecture
Portfolio
Management
Capability Portfolio
People
Process
Technology
Information
Business Case/Initiation
Project
Level
Activities
Requirements
Design
Develop/Test QA
Implementation/Support
5
Business Architecture Was Born
• Enterprise Architecture Introduces Component Based Design
– IBM’s Component Business Model (CBM)
Socializing the component based design was a key turning in point in
shifting the conversation from how to what we do as a business.
6
TIAA-CREF shifts from the CBM to Business Capabilities Map
Level 1
• The CBM never resonated with
business leaders
Business Management
– Separation of Plan, Control, Execute
Business Management
Enterprise Strategy and Planning
Client Relationships &
Experience
– Too abstract
Level 2
Products & Services Management
Financial
Strategic Planning
Mgmt
Marketing, Sales & Distribution Channel Mgmt
Enterprise Strategy and Planning
Enterprise Business Strategy
& Visioning
Policies , Architecture &
Standards Governance
External Relations
Management
Continuous Process
Improvement
Financial
Management
Product
& Service Management
Marketing,
Business Component
Names
Marketing, Sales
& Distribution
Investment Management
Servicing
Marketing
Sales Delivery
Touch Point Handling
Client Profile
Marketing & Sales
Strategy & Planning
Marketing & Advertising
Distribution & Channel
Strategy & Planning
Campaign Planning &
Execution
Sales Enablement
Distribution Channel
Profile
Sales Execution
Distribution Channel
Compensation
Product Delivery & Servicing
Cost Strategy
Product Delivery & Servicing
Policies & Procedures
Human Resources
Management
Management
Client Value Management
Touch Point Management
Client Service Performance
Management
Client Lifecycle Management
– Vetted with a broad cross section of business
• Applied the BCM
Enterprise
Services
Investment Strategy
Investment Philosophy
Servicing & Recordkeeping Administration
Eligibility,
Enrollment &
Entitlement
Investment
Accounts &
Positions &
Governance
Contracts
Balances
Lifecycle Mgmt
Contributions Billing &
&
Remittances Collections
Benefits,
Payouts &
Claims
Plan Lifecycle
Management
Accounting & Allocation
Strategy
Marketing Advertising &
Campaign Effectiveness
Level 4
Corporate Risk and
Controls Strategy
Portfolio Risk Strategy
Legal Strategy
Risk Management
Execution
Plan, Product,
Portfolio & Service
Performance
Statements
& Reports
Portfolio Asset
Allocation &
Balancing
Investment
Decisioning &
Trading
Investment Planning
Resource Acquisition
Talent and
& Retention
Resource Mgmt
Acquisition &
Asset
Disposition Management
Procurement Management``
Vendor and
Vendor and
Partner
Strategy
Sourcing &
Procurement
partner
Management
`
Transfer
Agency
Eligibility, Enrollment &
Delivery Oversight
Investment
Accounting
Enterprise
Services
Product Risk Management
Fraud Detection & Mitigation
Market &Credit Risk Mgmt
Security &Privacy Mgmt
Operations
Operational Risk Mgmt
Internal Mgmt / External
Reporting
Actuarial &Underwriting
General Ledger Operations
Legal
Product Delivery & Servicing
Performance Mgmt
Audit and Process
Assurance
Product Delivery & Servicing.
Audit & Exception Handling
Regulatory Compliance
Governance
Investment Ops,
Custody, Clearing
& Settlement
Investment
Valuation
Accounts Payable
Risk
Management Accounts Receivable
Oversight Treasury & Cash Flow
Information
TechnologyFinancial Oversight
Investment
Facilities
Management
Investment
Management
Trading, Settlement and Asset Management
Research &
Analytics
Financial Execution
Distribution Channel
Effectiveness, Oversight &
Management
Servicing
Management
Loan
Fulfillment
Investment Strategy
Human Resources Management
Human Resource
Strategy
Risk Strategy
Compliance and Regulatory
Strategy
Associated Capabilities
Sales Effectiveness,
Oversight & Management
Financial
Oversight
Servicing & Recordkeeping
Servicing Strategy
Investment
Product
Delivery & Servicing
Client Activities & Events Trading &
Settlement
Strategy & Design
Strategy
Client Relationship
Procurement
Analysis
Risk
Management
• Manages all inbound and outbound contact handling activities
between the company and all applicable parties (including
exceptions)
• Records interactions with clients via one or more access channels &
the internal actions taken as a result
Touch Point Handling • Manages the classification and activities of internal/external client
interactions
• Administers all client interaction routing per established client
handling rules
• Handle the client dialogue and provide response
• Authenticates user credentials
Enterprise
Services Investment Management
Communications and Correspondence
Client Advisory Services
Marketing, Sales &
Distribution
Channel Oversight
Distribution
Channel
Execution
Execution
Channel
Strategy
Servicing &
Recordkeeping
Servicing
Market Research & Management
Branding & Competitive
Strategy Client Experience
Administration
Analysis
Positioning Strategy
Client
Relationship
Analysis
Risk Planning
Governance
Sales
&
Product Portfolio
Product Distribution
Strategy
Product
Development
Lifecycle
Management
SalesProduct & Service Portfolio
Distribution
Product
&
Product &
Channel
Product &
Financial Strategy &
Service
Service
Product & Service Performance
Delivery Strategy
Service Profile
Channel
Sourcing
Deployment
Planning
Tracking
Product & ServiceExecution
Sourcing
Budgeting, Planning &
Strategy
Oversight
Forecasting
Product & Service Dev,
Product & Service Lifecycle
Product & Service
Financial
Product & Service Filing
Capital & Reserves
Configuration
&
Pricing
Oversight
Contribution Strategy
Client Relationship and Experience
Risk
Strategy
Strategy
Execution
ManagementTreasury & Cash Strategy
Servicing & Recordkeeping
Client Advisory Service Strategy
Execution
Marketing, Sales and Distribution Channel Mgmt
Case & Exception Handling
– Functionally organized
Financial
Strategy &
Business
Management
Performance
Risk
Mgmt
PlanningBusiness
Management
Enterprise Business Strategy
Development
Client Relationships &
Marketing,
Experience
Sales &
Servicing &Distribution
Recordkeeping
Client Marketing
Relationship
Strategy
Execution
Channel
StrategySegmentation Strategy and Planning
Risk Management
Level 3
Product Portfolio
Management
Lifecycle
Client
Relationship
Strategy
Client Experience
• Developed a multi-tiered Business
Capability Map (BCM)
Financial
Management
Product & Service Management
Product Development
Marketing and Sales
Management
Product
Strategy
Client
Relationships
& Experience
Governance
Allocation & Trading
Oversight
Portfolio Performance
Benchmarking
Portfolio Performance
Analysis & Oversight
Finance & Accounting
Controls
Treasury & Reserves
Management
Financial Performance
Measurement & Reporting
Investment Perf. Reporting
Facilities Management
Facilities Mgmt & Operations
Document, Image & Print
Risk Management
Oversight
Corporate Risk Oversight
Compliance Oversight
Audit Oversight
Legal Oversight
Portfolio Risk Oversight
Information Technology
Technology Strategy &
Planning
Technology Delivery &
Operations
– Every project undergoing an Enterprise Architecture Solution Definition Review
– Produced historical capability investment heat maps
– Produced the first forward looking portfolio investment heat map
Business stakeholders must be able to see and
describe their business using the model to accept it.
7
IT & Business Partner to Develop Business Architecture
• The CIO and COO Partner to develop Business Architecture
– Institutionalize Capabilities Orientation
– Establish a Center of Excellence
– Integrate into Business Cadence
– Strategy -> Execution Linkages
• Partnered w/ Booz & Co
How are we going to
create value for our
customers in this
market?
– Capabilities Driven Strategy
– Coherence Concept
– Distinctive Capability System
– Resonated w/ Executives
– Resisted by Sr. Leaders who
were more focused on closing
gaps in foundational
What do we need
to do well to
capabilities
deliver that value
proposition?
Right to
Win
What are we
going to sell in
this market and
to whom?
8
Business Blueprints to Strategy Implementation
Blueprint of the Business
Strategy Implementation & Reporting
Strategy
Way to Play
Capability Definition
1 Capability Blueprint,
including overlays of:
– Products and
Services
– Cost structure
– Investment
– Ownership
– Cost Model
– Risk
2 Capability Analysis
– Health and Parity
– Gap Assessment
3 Capability Roadmap
– Initiative Roadmap
and Investment
Prioritization
– Business Case
The complexity of the linkages between capabilities, process,
people, and technology requires a supporting data model
9
Pilots Uncover Strategy Gaps and Alignment Issues
• Traditional LoB strategies and execution were strong but generally not aligned
with the overall vision of the firm
• One executive challenged the business strategy for their business unit,
designed a new strategy, and obtained CEO / board approval
• Most investments were not developing “strategic” or “differentiating”
capabilities
• We experienced difficulties between functional capability alignment and the
distinctive capability system
• Sr Business leaders aligned with functional capabilities while executives
aligned with the distinctive capability system
• The business architecture engagement was redirected to focus on the largest
business unit and to align our work with LEAN process re-engineering efforts
Anticipate gaps in strategy and prepare to
work through the gaps or quickly redirect.
10
Capability to Process Linkage Model
1. Business Architecture Common Language:
A Capability represents WHAT we do and
serves as a common process classification
language. A Process is one element of HOW
we deliver value (along with people, technology
and information).
• Level 1 Capabilities serve as Process
Categories (APQC* L1)
• Level 2 Capabilities serve as Process
Groups (APQC L2)
2. Business Contextual Dimensions allow us to
transition from Capabilities to Physical
Processes. The three key business contextual
dimensions are Customer, Product, and
Channel.
3. Physical Processes must be measurable and
assignable and are documented at one of next
three APQC layers within a specific business
context
• Level 3 Process/ Activity (End to End –
Voice of Customer Value Stream
• Level 4 Activity / Task / Step (Standard
Work, commonality opportunity)
• Level 5 Task / Step / Data (Procedures)
* APQC - American Productivity & Quality Center
11
Business Capability Model
L1 Business Capabilities
Foundational
Value Chain
L1 Capability and Contextual Dimensions
Product
Management
Marketing
Sales
Operations &
Administration
Onboarding
Client Servicing
Client Relationship & Experience Management
Investment Management
Strategic Planning
& Business
Modeling
Governance &
Program / Change
Management
Human Resources
Management
Risk, Fraud, Law &
Compliance
Finance,
Accounting &
Vendor
Management
Facilities
Management &
Operations
Data Analytics &
Information
Technology
Business Context
Contextual Dimensions
Client Types
Dollar Stretchers
Mass
Individual / Participant
Life Builders
Accumulators
Affluent
Transitions
Established
High Net Worth
Premier / Jumbo
Higher Ed
Institution / Sponsor
Partner / Large & Medium
K-12
Hospitals
Direct / Small
Government
Product Lines
Life Insurance
(Term & Perm)
Non-Qual. After
Tax Annuities
Individual Products
Education Savings
Brokerage
Personal Trusts
Asset Management
Checking
Loans
Mutual Funds
Managed Accounts
Savings & CDs
Real Estate
Secured Loans
Annuities Accounts
Ind. Retirement
Accounts (IRAs)
Prepaid Cards
Institutional Products
Planned
Retirement
Retirement
Giving Trusts
Plans
Health Svgs Plans
Executive
Deferred
Endowments
Compensation Compensation
Management /
Advisory Services
Channels
Internet
Authenticated
(Dot Com, Social, Chat) (Online, Chat, ATM)
Mobile
TIAA-CREF / Partner Channels
Email Inbound Calls /
Inside Sales
High Touch Sales
Specialized
Intermediaries
(Out /In)
IVR
(Outbound Calls) (Wealth, FCG, etc.)
Sales & Service
Mail /
Image /Fax
OGSM
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Business Architecture Value Propositions
Durable, Model Driven Approach
Operational
Excellence
Each engagement leverages
the knowledgebase speeding
analysis and reducing
cost/effort
 Cross Portfolio Impact
 Strategic Portfolio
Outcome Alignment
 Cross Portfolio Collisions –
Efficient Execution
Portfolio
Optimization




Process Complexity
Technology Complexity
Vendor Analysis & Leverage
Employee Productivity Onboarding and Experience
Engagements builds upon
the depth and breadth of the
knowledgebase
Business
Architecture
Framework
Layer maturity
development effort
immediately benefits
the engagements
Customer
Experience
 Customer Experience
Consistency
 Competitive Parity
 (Product, Channel and Service)
 Gap Ranking
 Competitive Advantage
A durable, model driven approach is the key to analyzing, managing and
optimizing the design of TIAA-CREF’s increasingly complex business
13
Business Drivers
Define the overall purpose for analyses
Process Pattern
Business Capabilities
Level 1 Capability / Process Group
Level 2 Capability / Process Category
Business Drivers:
Level 3 Capability/Process
Activity
•
•
Task
Provide the underlying
business purposes for
defining an analysis’
scope
When linked to Process
Patterns, insights can be
gained around:
•
•
•
•
•
•
•
Competitive Advantage
Competitive Parity
Project Change Impact
Gap Ranking
Strategic to Portfolio
Alignment
Customer Experience
Risk Alignment
Step
Channels
Customers
Channel Method
Market Group
Channel Type
Segment/Sector
Channel
Sub-segment
Products
Product Group
Product Family
Product
Linking and Leveraging:
When each Business Driver is linked to defined
Process Patterns we will be able to provide
further insights into Business Enablers linked
to the same Process Patterns. For example:
•
•
•
•
Process efficiency opportunities
Operational complexity
Operational costs
Vendor analysis
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Process Patterns
The Hub for Business Insights
Process Pattern
Business Capabilities
Process Patterns :
Level 1 Capability / Process Group
Level 2 Capability / Process Category
•
•
Define a common
vocabulary and
methodology for
organizing business
processes across any
combination of product,
customer and channel
dimensions
Provide the “connective
tissue” that links
Business Drivers
(Strategy, Change Programs,
Risk, and Gaps) to
Business Enablers
(People, Technology and
Information)
Level 3 Capability/Process
Activity
Task
Step
Channels
Customers
Channel Method
Market Group
Channel Type
Segment/Sector
Channel
Sub-segment
Products
Product Group
Product Family
Product
15
Business Enablers
Provide the underlying data for analysis
Enablers
People
TIAA-CREF
Business Enablers:
•
Represents the
components utilized to
support company
processes/capabilities
Vendor
Organization / Legal Entity
Process Pattern
Department / Group / Team
Business Capabilities
Role / Job
Level 1 Capability / Process Group
Level 2 Capability / Process Category
Skill / Competency
Level 3 Capability/Process
Activity
•
•
Each “layer” provides
details and attributes
which deliver insights into
HOW (and how well)
processes are being
supported (or could be
better supported) from an
organizational and
technology infrastructure
Each Business Enabler
is linked to each Process
Pattern component at
defined levels
Task
Step
Channels
Customers
Channel Method
Market Group
Channel Type
Segment/Sector
Channel
Sub-segment
Products
Information
Technology
Library
Business Platform
Collection
Business System
Group
Application
Location
Product Group
Product Family
Product
Country
Region
State
County
Fascility
Examples of Data
Requirements captured and
stored for each “Layer”
Technology
Description
Lifecycle stage
Business Health
Tech Health
(complexity an
attribute)
Run cost
Platform Owner
Host
(internal/external)
Information
Segment
Quality Rating
SOR Flag
Required data
elements
People
Sourcing (Internal,
Outsource/Contractor,
Offshore)
Required Skill Set
Engagement Level
Location
Coverage hours
Costs per employee
16
Where We Are Now
• Preliminary mapping of the 2013 Strategic Investment Portfolio
– Key insights: Collisions, Efficiency opportunities, Readiness / Impact Assessment
• Model Applied to Business Engagements
– Helping visualize technical and process complexity.
– Process optimizations appear to return 10x the value of technical platform
simplification
• Model / Reporting rapidly produces insights and enables “pivoting” on any layer
– Process, Technology
• Dramatic reduction in analysis time
– Leverage model for focused analysis
– Estimate a 40-60% reduction in analysis effort – focus expensive consulting resources
• Developing the depth and breadth of the model
• Adoption of “Capabilities” in addition to “Process”
• Pull vs. Push
17
Looking Forward
• Technical Roadmaps are truly Business Driven / Prioritized
• Business Architecture as a key foundational component of a new business
strategy
• Integrated Process Pattern Mapping into 2014 Planning
– All 2014 projects will identify process patterns before funding consideration
– Influence the design of the investment portfolio
– Influence / structure the execution portfolio (stretch)
• Operationalize the data model
– Add quantitative measures & data to qualitative
– Process optimizations appear to return 10x the value of technical platform
simplification
• Integrate Business Architecture into every major consulting engagement
• Revisit strategic / differentiated capability
18
Business Architecture Challenges & Lessons Learned
Approach
• Top-down Business Architecture
exposes strategy gaps
• LoB vs. the Enterprise value
• Difficulty of business leaders to
see value in an abstract concept
• Delivery teams can be threatened
• Business engagement is critical
• Business resistance
• Work through the strategy gaps or
course correct quickly
• Deliver LoB value first
• Find and support partners and
advocates
• Engage delivery teams
• Educate and engage at all times
• Demonstrate value quickly
Tools
Lessons Learned
• The “right level“ of tool support is
critical
• Nuances of capabilities
• Simple databases/models and
avoid PowerPoint hell
• Get “close enough” and move on
Team
Challenges
• Skilled / experienced Business
Architects are difficult to find and
grow
• Business expertise matters
• Where your team reports matters
• Be patient for the right skills,
leverage peer groups, grow your
own
• Consider senior business leaders
• Align reporting to objectives of BA
19
Thank you!
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