Enterprise Architecture For Traditional Industries in A Globally Transforming Digital Age

Enterprise Architecture for traditional industries in
a globally transforming digital age

Dr. Sebastian Wedeniwski
IBM Distinguished Engineer, CTO Automotive Industry
2014 IBM Corporation

IBM Global Automotive
Dr. Sebastian Wedeniwski

Sebastian is an IBM Distinguished Engineer who is continuous driving optimized business solutions through IT
innovation specifically with automotive clients. In this activity he was the inventor of many unique optimization
algorithms.
He is the Chief Technology Officer for IBM Automotive Industry Japan leading the technical strategy for data-centric
business models and connected vehicles to create new solutions to address the physical and virtual mobility
demands of the industry.
Sebastian has more than 21 years experience in the IT and 12 years in the Automotive Industry. He has a strong
reputation recognized globally within and outside IBM as a member of IBMs IT Architect profession, IBM Academy
of Technology Leadership Team, and IBM Technology Team Advisory Council.
Before joining IBM Research & Development Laboratory Germany as chief IT architect for payment systems in
banking environments in 1998 he managed and owned two software development companies.
He graduated (Associate's Degree/Diploma) both in Mathematics (Cryptography) and Computing Science
(Computational Mathematics) in 1997 and received his Doctorate Degree in Mathematics (Number Theory) from
the University of Tbingen in 2001. Between 1998 and 2005 he set many mathematical computation world records
and led the project ZetaGrid which was the first large distributed computation grid within IBM connecting 11,000
systems. In 1993 he was winner at the 12th German Nationwide Contest for Computing Science (BWINF).
Sebastian is a member of the International Association of Software Architects (IASA) and Association of The Open
Group Enterprise Architects.
2 IBM Amagi Enterprise Architect Summit Dr. Sebastian Wedeniwski, IBM Distinguished Engineer, CTO Automotive Industry September 5, 2014 2014 IBM Corporation
This may be a wonderful tool
Photo: Nespresso
But this a wonderful experience!
Product orientation example Bill of Materialthousands of parts
Automobile
Subsystems Powertrain
Internal
Modules combustion
engine
Groups Cylinder head
Subgroups Valvetrain
Parts Globe valve
Valve spring
Photo: Daimler AG
Camshaft
Individualized products for target customer segments

Photos: Daimler AG
Electric Family
Performance Offroad

But we need to think about the way we architect a system
An engineering approach:
A product is complete, if you cannot add functionality to it
Purpose oriented approach:

A product is complete, if you cannot remove functionality any more without breaking it
Photos: Victorinox
Growing importance of Information Technology in Automotive

Photos: Daimler AG
Digital Transformation of the product

and supporting processes
1886 2014
Benz Patent Motor Car New Mercedes
Vehicle Architecture
Product 0% IT Product >30% (Software)
Research & Calculation support Research & >70% (Computer-

Development Development Aided Engineering)
Enterprise Architecture
Production 0% Production >60% (Computer-
Aided Manufacturing)
Marketing & Sales 0% Marketing & Sales >40% (Internet)
Aftersales 0% Aftersales >30% (Diagnostics)
Administration Calculation support Administration >60% (HR, Finance,
Procurement)

Scope of Enterprise Architecture
Business'Model'
Organiza4on'
follows belongs to uses
Business
Orientation
Business'Domain'
1:n
Business'Capability'
1:n
m:n
Business'Func4on'
m:n
m:n m:n
Business'Process' Business'Service' Applica4on'
m:n
m:n m:n
m:n
Data' Technology'
IT Orientation Enterprise Architecture
IBM Automotive Industry Domain Model High Level Overview
Product'Management'&'Marke4ng'
Procurement'
Financial'
Services'
Research'&' PreFProduc4on'/'
Produc4on' Sales' ACermarket'
Development' Construc4on'
Mobility'Services'
Supply'Management'&'Fulllment'Logis4cs'
Business'Administra4on'
General'Support'Func4ons'
IBM Automotive Industry Business Capability Model

Portfolio Management Product Change Management Market Research / Analysis
Communication Strategy
Product Requirements Mgmt Customer Relationship Mgmt Product Management & Marketing External Communications
Product Documentation Information Mgmt Editorial Office
Brand Management
Supplier / Procurement Strategy Tender Process Contract Management

Supplier Management
Procurement Performance Management
Research & Pre- Production Sales Financial Aftermarket Mobility

Development Production / Services Services
Construction
Product / Portfolio Mgmt Aftersales Strategy Mobility Strategy
Dev. Project Mgmt Process Planning Factory Management Sales Strategy Lease Mgmt Relationship Mgmt Infotainment
Dev. Standards (Assembly, White Body) Production Planning / Demand Forecast / Contract Mgmt Contract Mgmt Connected Navigation
Requirements Tooling/Die/Mold design Scheduling Analysis Credit Admin. Service Station Planning Safety and Security
Design Production Engineering Component Production Sales Planning Contract Accounting Parts/Svcs Offering Mgmt In-Vehicle Driver
E/E & Software Dev. (Robot, Machining) Assembly Lead Management Contract Origination Vehicle Service Guidance
Mechanical Dev. Plant design Production Order Mgmt / Fulfillment Funding Mgmt End-of-life Service Vehicle Diagnostics
Digital Validation Digital Factory Maintenance Sales Documentation Service Comp. Mgmt Logistics / Supply Mgmt Electric Vehicle Srvc
Physical Validation Type test (Vehicle Quality Management Lease Mgmt / Financial Collection Mgmt Aftersales Documentation Fleet Management
Development Support certification) Services Banking / Brokerage Warranty / Quality Mgmt Mobility 2.0 (Car
Research Issue Tracking Vehicle Service Offerings Remarketing Service Training Sharing, PAYD
Documentation Compliance Insurance, Intermodal
Risk Mgmt Travel, Traffic Mgmt)
Supply Chain Strategy Transport Mgmt

Supply Chain Integration Mgmt Dispatching
Partner Relationship Mgmt Supply Management & Fulfillment Logistics Container Mgmt
Warehouse Mgmt Inventory Mgmt
Disposition / Consumer Supply
Enterprise Strategy Shareholders & External Relationsh. Ordinal Cost and Expense Mgmt
Enterprise Business Mgmt Financial Performance Report Business Administration Vehicle Development Project Budget
Quality Management Enterprise Financial Consolidation and Cost Management
Controlling HR Real Estate Mgmt

Accounting & Financial Reporting IT Env. Compliance, Security, Safety
Treasury Internal Control / Audit Mgmt Fixed Assets
General Support Functions
Risk Mgmt. Tax Mgmt Administration
Policy Mgmt Planning and Forecasting Knowledge Mgmt of Corp. Inform.
(lifecycle mgmt, maintenance process)

Brand Management

Supplier Management

Construction


Sourcing strategy of IT Functions Examples Heat Map General Motors
Source JPA CMMI IT http://www.ipa.go.jp/files/000006029.pdf

Brand Management

Supplier Management

Construction


Application Landscape a list of the live applications is influenced by many

technologies Examples for a business domain Sales
Source: CedarCone
IT hot spot of Enterprise Architecture
Business'Model'
Organiza4on'
KPI Categories:
Compliance
Innovation
Capability Business'Domain'
provision
1:n
Transparency
Homogeneity
Redundancy Business'Capability'
Project
1:n
execution
Cost
Disaster m:n
Business'Func4on'
tolerance
Security m:n
m:n m:n
m:n
m:n
Practical compromise needed m:n
m:n
to reduce complexity Data' Technology'
But coming back to Vehicle vs Enterprise Architecture

Photos: Daimler AG
The reality is still far away from the theory!
2014
New Mercedes
Vehicle Architecture
Business Model focus in Automotive Industry Product >30% (Software)
Research & >70% (Computer-

Development Aided Engineering)
Production >60% (Computer-
Aided Manufacturing)
Marketing & Sales >40% (Internet)
Aftersales >30% (Diagnostics)
Administration >60% (HR, Finance,

Procurement)

The Enterprise Architecture depends on the Business Model
Vehicle as an integral part of the

Internet is a feature in cars
customers personalized network
Different
Business
Models
Photo: Daimler AG
owning car business car related business beyond car business

production leasing car rental car sharing inter-model mobility chauffeur service
What is the reason for mobility and creating the Automotive Industry?
Mobility is about getting from A to B
Options to a set of mobility services

Profile
Time
Costs
Convenient
Comfort

Start
Use Case
Business
Leisure
Shopping

Platform to Mobility Service Providers
Risks regarding endangering reputation and brand value

Google Executive Chairman Eric Schmidt famously (or infamously) said
Googles policy is to get right up to the creepy line but not to cross it
CONSUMER DATA INSIGHTS
Source: BMW Redefining Premium Brand Identity
Traditional brand values: comfort, safety, longevity, reliability,
PRODUCT INSIGHTS
Risks regarding endangering reputation and brand value

Example: Autonomous Driving
Why do I need to own a car? Driving as a service

Why do I need vehicle insurance?
Can I change the
individualization of the Why do I need parking?
car per ride?
Engineering challenge
Photo:&Google&
Getting from A to B might

be free of charge
Patent 8.630.897
Transportation-aware
physical advertising
conversations
Safety is critical
Photo:&Daimler&AG&
Next generation of Advanced Driver Assistance Systems
Driving remains with the car
New and emerging technologies will combine to transform industries
Inbound Design and Outbound Marketing Consumer

logistics operations logistics and sales experience
Value chains will fragment Margin
Inbound Outbound Marketing Consumer

Healthcare Operations M
logistics logistics and sales experience
Operations Marketing Consumer

Industries will converge Distribution Inbound Outbound M
logistics Specialist logistics and sales experience
Inbound Outbound Marketing Consumer M

Electronics Operations
logistics logistics and sales experience
Inbound Operations Outbound Marketing Consumer M

Retail experience
logistics logistics and sales
Ecosystems will emerge
Source:&IBM&Ins9tute&for&Business&Value&&Digital&Reinven9on&
The Shift to Services IBM Mobility Domain Model High Level Overview
Product/Services'Management'&'Marke4ng'
Procurement'
InFVehicle'R&D' Produc4on' ACermarket'
Mul4FChannel'
Financial'Services'
Sales'
Service'
Mobility'R&D' Mobility'Marketplace'
Enablement'
Supply'Management'
Business'Administra4on' Data'Services'
&'Fulllment'Logis4cs'
Quality'Management'
General'Support'Func4ons'
Summary hot spots of Enterprise Architecture
Business'Model'
Organiza4on'
Business'Domain'
Need to be accurate and 1:n
open for significant changes Business'Capability'

1:n
m:n
Business'Func4on'
m:n
m:n m:n
m:n
m:n
Practical compromise needed m:n
m:n
to reduce complexity Data' Technology'
Thank You!

Enterprise Architecture For Traditional Industries in A Globally Transforming Digital Age

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Enterprise Architecture for traditional industries in

a globally transforming digital age

2014 IBM Corporation

Dr. Sebastian Wedeniwski

This may be a wonderful tool

But this a wonderful experience!

Product orientation example Bill of Materialthousands of parts

Groups Cylinder head

Parts Globe valve

Individualized products for target customer segments

But we need to think about the way we architect a system

Purpose oriented approach:

Growing importance of Information Technology in Automotive

Digital Transformation of the product

Research & Calculation support Research & >70% (Computer-

Scope of Enterprise Architecture

IT Orientation Enterprise Architecture

IBM Automotive Industry Domain Model High Level Overview

IBM Automotive Industry Business Capability Model

Supplier / Procurement Strategy Tender Process Contract Management

Research & Pre- Production Sales Financial Aftermarket Mobility

Supply Chain Strategy Transport Mgmt

Controlling HR Real Estate Mgmt

IBM Automotive Industry Business Capability Model

Supplier / Procurement Strategy Tender Process Contract Management

Research & Pre- Production Sales Financial Aftermarket Mobility

Supply Chain Strategy Transport Mgmt

Controlling HR Real Estate Mgmt

Sourcing strategy of IT Functions Examples Heat Map General Motors

Source JPA CMMI IT http://www.ipa.go.jp/files/000006029.pdf

IBM Automotive Industry Business Capability Model

Supplier / Procurement Strategy Tender Process Contract Management

Research & Pre- Production Sales Financial Aftermarket Mobility

Supply Chain Strategy Transport Mgmt

Controlling HR Real Estate Mgmt

Application Landscape a list of the live applications is influenced by many

IT hot spot of Enterprise Architecture

But coming back to Vehicle vs Enterprise Architecture

The reality is still far away from the theory!

Research & >70% (Computer-

Aftersales >30% (Diagnostics)

Administration >60% (HR, Finance,

The Enterprise Architecture depends on the Business Model

Vehicle as an integral part of the

owning car business car related business beyond car business

Mobility is about getting from A to B

Options to a set of mobility services

Platform to Mobility Service Providers

Risks regarding endangering reputation and brand value

CONSUMER DATA INSIGHTS

Source: BMW Redefining Premium Brand Identity

Traditional brand values: comfort, safety, longevity, reliability,

Risks regarding endangering reputation and brand value

Why do I need to own a car? Driving as a service

Getting from A to B might

Next generation of Advanced Driver Assistance Systems

Driving remains with the car

New and emerging technologies will combine to transform industries

Inbound Design and Outbound Marketing Consumer

Value chains will fragment Margin

Inbound Outbound Marketing Consumer

Operations Marketing Consumer

Inbound Outbound Marketing Consumer M