Agile transformation in a VUCA world: EA lessons from digital leaders

Academic and professional researchers have identified that Enterprise Architecture (EA) is a key component of successful IT-enabled business change and specifically a key capability for digital transformation. Agility is similarly important in a changing world characterized by VUCA (volatility, uncertainty, complexity, ambiguity). Hence EA survey research was initiated with business leaders and IT professionals to establish the differentiating factors in building EA capability and agility in a digital world. The McKinsey & Henley EA survey reports on research conducted with more than 100 IT leaders and professionals. It assesses three areas in conducting agile transformation. The first part reviews the relationship between agility and complexity in digital transformation. The second investigates and reports on how digital leaders use agile methods compared to their counterparts. Finally, the survey findings report on the use of transformation artefacts and in particular capability building to achieve agility. The survey shows that managing IT complexity is key to reducing integration effort since organizations with fewer interfaces and applications together with a lower share of point-to-point connections have relatively lower integration costs. One critical way that EA can address this issue of complexity is through better services management, in effect increasing the number and reuse of services. The survey found a significant difference in these areas where EA contributes to digital transformation. Further, EA digital leaders are typically more discerning in how they use agile, for example with systems impacting customer experience. They are also more likely to define target architectures and to utilize business capabilities in grouping milestones. Organizations with the most effective EA departments are able to use capability maps to increase speed of innovation by better management of project portfolio. This research finds that digital leaders deal with agile transformation in a more competent and focused way than their counterparts. This results in EA outcomes which reduce complexity and enhance agility to deliver significant benefits for organizational stakeholders. We conclude that top executives need to be informed of the factors that make digital transformation successful