Aligning Organisational Architecture with Strategic Intent

Was your organisation intentionally designed or has it evolved over time? Is the way it operates a result of informed choices aimed at realising its strategic intent or an outcome of repeated compromises aimed at optimising what’s already in place? Is your organisation agile and able to respond to ever-changing threats and opportunities, or one that is inflexible and difficult to change? If it’s the latter then your organisation is – as Trafford and Boggis describe it in their book Beyond Default – likely to be ‘anchored’ to its current trajectory and unlikely to realise its strategic intent.

While we often talk about the importance of organisations being well led and managed, we rarely talk about the importance of them being well designed. It’s often forgotten that organisations are artefacts, as they are man-made entities rather than something that has occurred naturally. As a result they can be designed to be aligned with – and thereby enable – an organisation achieving its strategic intent. Equally they could evolve with no strategic intent in mind.

Should the design outcome be greater agility?

To a degree yes. Organisations that are agile are better able to change and respond to their changing context. But is it really feasible for an organisation to be so agile that it can respond to any change in context? We think not. Furthermore, could being too agile lead to chaos, where no one really understands what the organisation is trying to achieve, and why? We think yes. While being agile is an important organisational capability it is not a substitute for having a clearly thought-through strategy. A strategy that is based upon a thorough understanding of the organisation’s current trajectory (and the default future it will bring), how its context is changing and the strategic opportunities available to it. Being agile is a necessary organisational capability, but it is not sufficient.

The purpose of strategy

In their book Beyond Default Trafford and Boggis argue that the essential purpose of strategy is to take an organisation beyond its default future by setting it on a trajectory to an improved future. They believe that this can only be done by first understanding the reasons why an organisation is on its current trajectory and the default future it will bring. Only then can the spectrum of strategic opportunities available be assessed and an informed choice made on the trajectory of strategic intent.

While having strategic intent is important, there is often a lack of clarity on the specific changes an organisation needs to make in order to turn its strategic intent into operational reality. As a result change initiatives often have conflicting – as opposed to complementary – objectives, resources are spread too thinly and people don’t know what is expected of them. The reason for this confusion is the lack of an intermediary step, one that defines that target architecture of the organisation.

Organisational architecture

In building design – from where the term architecture originates – the architecture of a building is a result of the design choices made in respect to its layout, structure, orientation, infrastructure, lighting, flow and more. The architecture of a building can be studied retrospectively, in terms of what’s been created, or proactively by assessing whether the design choices will achieve the building’s strategic intent. The strategic intent of a house, hotel, office block, university campus, hospital or airport are fundamentally different. These differences are reflected in their respective architectures.

The same thinking can be applied to organisations. The strategic intent of a digital bank is very different to that of a government body providing public services and their architectures, resulting from the design choices on process, structure, systems, technology, roles, physical layout and geographic footprint, should reflect this.

As with the architecture of a building, the architecture of an organisation enables or prevents it achieving its strategic intent. Its architecture could make it agile or inflexible to change; costly or efficient to run; intelligent or dumb to operate; an engaging or unbearable place to work. The resultant architecture is a result of the choices made, either explicitly or implicitly, when turning strategic intent into operational reality.

It’s also important to note that an organisation’s architecture is not the same as its operating model. An operating model is a much more detailed description of how an organisation operates and comprises: for example, process descriptions, organisational structures and governance procedures. The architecture of an organisation is a more abstract definition that provides guidance on the design of the operating model through a set of Operating Principles and Design Principles, where a principle is defined as a ‘conscious choice between two equally valid alternatives’.

In this article we’re using the term organisational architecture rather than business architecture simply to emphasise that the thinking is equally valid to all forms of organisations, whether they are a private or publicly-quoted company, a not-for-profit organisation or government agency.

Operating principles

For an organisation to realise its strategic intent it’s inevitable that changes will need to be made to how it operates. These changes can be articulated through a set of operating principles. In essence they describe how the organisation aims to operate and behave in the future. When defining operating principles it’s assumed that the organisation is a black-box in that little is known about how the operating principles will be realised. That comes later.

For example, if an organisation’s strategic intent is to become a ‘pure-play’ digital enterprise that engages with its customers through compelling experiences over their tablets and smart phones, the chosen operating principles could include:

‘We engage with customers via their mobile devices only, on a 24/7 basis.’
        as opposed to …
‘We engage with our customers over multiple distribution channels.’

‘Our source of continued differentiation is the enriched digital experiences we provide.’
        as opposed to …
‘We differentiate ourselves through product and price.’

‘Our products and digital experience address a broad church of users, no matter what their needs, expertise or experience.’
        as opposed to …
‘Our products and digital experience meets the needs of today’s digital natives.’

‘Our products and digital experience can be customised by our customers at their moment of need.’
        as opposed to …
‘Our products and digital experience is based upon one design for all.’

‘Our processes are optimised to provide a seamless and automated end-to-end user experience.’
        as opposed to …
‘Our processes are optimised for functional efficiency and minimum risk.’

‘We use insights gained from interacting with our customers as a source of strategic intelligence and a foundation for continued development of our products, propositions and experiences.’
        as opposed to …
‘We develop our products, propositions and experiences based upon market research and customer feedback.’

‘We meet the changing needs of our customers through a continual stream of incremental enhancements.’
        as opposed to …
‘Enhancements are released in periodic batches.’

‘We foster a community where our customers and partners can share knowledge, offer support and seek help.’
        as opposed to …
‘We engage with our customers and partners through multiple social media platforms.’

In addition to an overarching set of operating principles additional ones would be needed for different parts of the organisation: for example sales, operations, customer service, IT and finance. These ‘functional’ operating principles would need to be aligned with the organisation’s overarching operating principles and its strategic intent.

For example the operating principles for the IT organisation could include:

‘Software development and deployment is closely integrated and delivered through Agile and DevOps methods.’
        as opposed to …
‘Software solutions are developed using the classic ‘waterfall’ approach and then passed to IT Operations for deployment.’

‘IT development resources are organised and managed in flexible teams.’
        as opposed to …
‘IT development resources are organised and managed in fixed functional units.’

Note that an operating principle not only defines the intent but also what it intends not to do. It’s as important – if not more important – to be clear about how you’ve decided NOT to operate as how you’ve decided to operate. Defining an equally valid alternative principle, the ‘as opposed to …’, does exactly this. An operating principle therefore defines two choices, not one. It defines how the organisation intends to operate in the future and, just as important, how it intends not to operate in the future.

Design principles

While operating principles define how the organisation should operate in the future they do not define how the organisation should be designed. This distinction is important as there are many ways in which operating principles could be realised. How operating principles are to be realised is therefore defined through a set of design principles. The logic being that if the organisation is designed (or redesigned) in line with the design principles, then the operating principles will be realised and the organisation will change its trajectory to one that is aligned with its strategic intent.

As with operating principles, design principles not only define the chosen principle but also an equally valid alternative that has been rejected.

For the ‘pure-play’ digital business operating principles discussed above some of the possible design principles could include:

‘The technology landscape is an integrated digital platform.’
        as opposed to …
‘The technology landscape is based upon an industry standard integrated package.’

‘The digital platform is loosely coupled but tightly aligned.’
        as opposed to …
‘The technology landscape comprises independent components.’

‘The IT landscape comprises applications that are based upon service-orientated architecture (SOA) and standard application program interfaces (APIs).’
        as opposed to …
‘The IT landscape comprises applications that have customised private access to data.’

‘Use (and reuse) application software components that are common and shared.’
        as opposed to …
‘Use uniquely developed software components.’

‘Integrate platform components via middleware infrastructure.’
        as opposed to …
‘Integrate platform components using point-to-point interfaces.’

‘Innovate at the edge of the applications landscape and then rejuvenate the core.’
        as opposed to …
‘Treat every component as core.’

‘The digital platform comprises both own designed and third-party solutions.’
        as opposed to …
‘The digital platform comprises only in-house developed solutions and technologies.’

‘Software is deployed in the cloud and in-house data centre.’
        as opposed to …
‘Software is deployed in the cloud only.’

As with operating principles, different parts of the organisation would define their own design principles that are aligned with the overarching design principles, operating principles and strategic intent. Furthermore, the design principles would cover all facets of an organisation’s operating model, including structure, technology, process and sourcing.

Collectively the design principles determine the future architecture of the organisation. If they are aligned with the operating principles they will enable the organisation to realise its strategic intent. If not they will result in the organisation pursuing a trajectory that is out of line with what it aims to achieve.

Defining operating and design principles is important as it establishes a line-of-sight between an organisation’s strategic intent and its organisational architecture. The degree to which the principles are being applied can be assessed over time either through independent or self-assessments, thereby enabling senior leaders to take corrective action as needed.

It’s often forgotten that there is more to strategy than defining strategic intent. It’s a process that involves making choices about how the organisation should operate and how it should be designed. Without this clarity the resulting architecture of the organisation is likely to fragmented, difficult to change and pulling in many directions.

Final thought

All organisations have an architecture – whether through intent or by default. Any changes made to an organisation will therefore inevitably change its architecture. The question is will the architecture resulting from these changes be aligned with its strategic intent?

We welcome your thoughts.

David Trafford
Co-author of Beyond Default and Managing Director of Formicio, a strategy and strategic change consultancy

Stuart Bell
Digital architect who advises organisations on their digital strategies. Stuart can be contacted at