Delivering Business Value via EA

by Madeline Weiss, Society for Information Management’s Advanced Practices Council

Although the number of non-IT business executives who can describe the value of their firms’ enterprise architecture (EA) is probably quite small, Chubb Insurance executives are not in that group.

Chubb’s 10-year journey towards comprehensive EA that enables the firm to move confidently into a world of rapidly changing markets and technologies is not completed. But it serves as an excellent example of the benefits of investing in EA, especially in a federated organization with multiple lines of business accustomed to operating independently.

The architecture function at Chubb mirrors its federated business structure. Under the direction of Patrick Sullivan, Chubb’s chief architect, the core team of five enterprise architects set the strategic direction and standards for Chubb in collaboration with the lines of business architects, who report to both that line’s CIO as well as Sullivan.

Although this structure is harder to manage, its key advantage is that the lines of business CIOs and their IT staff are members of their business teams. Given the trust between lines of business CIOs and their businesses, there was little resistance to the EA concept.

Chubb’s architectural model is based on The Open Group Architecture Framework (TOGAF). It consists of five major components that interact with and support each other:

Architecture strategy – The strategy defines the major direction and components of the enterprise architecture, which are in turn, developed into an operating model and specific enterprise architecture roadmaps. There are three major plans: 1) Technology rationalization road map, which provides a long range view of the technology portfolio to reduce redundant, obsolete or deficient technologies, and targets emerging technologies in a consistent manner; 2) application rationalization road map, which systematically identifies application assets that are deemed strategic and those targeted for retirement and outsourcing; and 3) Project portfolio analysis, which creates a long range view of projects and documents individual “city plans” to aid in the development of strategies and identify needs for new technologies or organizational support.

Architecture definition – Lines of business architects participate in one of about 12 standards subgroups that set technical standards in such areas as desktop, security and middleware. These groups thoroughly assess available technologies and make adoption recommendations. They first experiment with a technology, then set it as an emerging standard, and monitor its implementation.

Architecture governance – Architecture definition provides the context for the design, development and implementation of architecture governance processes and policies. These processes and policies then ensure that all projects comply with the agreed architecture.
The Chubb Architecture Review Board is composed of the senior architects from the lines of business as well as Sullivan and his lead architects and is the focal component of the governance process. Together they approve the standards that guide and direct the lines of business architectures.

Lines of business project implementation – Architecture governance oversees project implementations, providing project strategy review, consulting services and technical support, while monitoring compliance.

Enterprise shared assets and solutions – The architecture strategy identifies where the organization needs thought leadership and other enterprise shared assets, such as consulting support and strategy review. Chubb’s architects support projects, assist each other, educate and work with business leaders, and develop key assets for the organization. Such shared assets and governance are part of Sullivan’s deliberate strategy to “blend and wave architecture into the fabric of the organization” rather than centralizing all architecture activities.

There is widespread agreement across Chubb that Sullivan, an exceptional leader, has been critical to its enterprise architecture success. Sullivan’s strong architectural vision, combined with his business background in finance and actuarial science, helps him articulate the business value of enterprise architecture.

Sullivan believes that the culture he and the IT senior leadership team have created in enterprise architecture takes care of most of the politics and personality issues that often interfere with effective decision-making. “It’s all about minimizing the processes, adding value and helping people understand basic architectural principles,” he said. “We don’t take a ‘field of dreams’ approach to architecture. Our programs are all business-oriented and attached to real value and real projects. Once leaders understand this, we get their support.”

Some of the business benefits Chubb has been able to realize as part of their EA efforts include:

  • An Investment road map Because Chubb’s enterprise architecture depicts how data, technologies, applications and business capabilities fit together, the CIOs of each line of business can communicate with their non-IT business colleagues where and how IT is investing in the capabilities they need.
  • Cost savings The architecture identifies opportunities to share common tools and processes across lines of business, thereby reducing costs. For example, EA saved Chubb $600,000 in 2010 by redistributing unused site licenses for software.
  • Credibility With excellent enterprise architecture processes in place, executives have confidence that Chubb is selecting the right technologies with the right understanding of business needs.
  • Time-to-market With effective processes and standards, time-to-market decisions can be made more quickly. Sharable capabilities ensure that tools are in place before needed and competency centers enable projects access to a considerable depth of knowledge on an as-needed basis.

This article is based in part on the case study, “Delivering Effective Enterprise Architecture at Chubb Insurance,” written for the Advanced Practices Council of the Society for Information Management by Heather Smith.

Madeline Weiss is director of the Advanced Practices Council, a research-based forum for senior IT executives looking for leading-edge insights into leveraging IT for corporate competitive advantage, sponsored by the Society for Information Management (SIM). Weiss is also president of Weiss Associates, Inc., a consulting firm specializing in organizational strategy and change, especially as they relate to information services and technology. With over 30 years’ experience, Weiss consults to global businesses (many in the Fortune 100), international non-profits, universities and professional organizations.