In our last post, we looked at using business architecture for startups and small businesses. In the generous spirit of the holidays, StraightTalk Post No. 18 looks at using business architecture within the context of non-profit organizations.

Does business architecture apply to non-profit organizations?

As you remember from Post No. 17, business architecture is beneficial to any size of organization—from a sole proprietor to a large global organization. It is also beneficial to any type of organization—including for-profit, non-profit and governmental organizations.

No matter what an organization’s type or size, it has the best chance of success with:

• A viable and competitive business model
• An intentionally designed organization
• A way to set and execute direction

Business architecture is a star at helping with all of these.

How exactly does it apply then?

Non-profit organizations care about things like:

• Achieving their missions to the greatest extent possible – There is nothing more important than carrying out the organization’s mission to serve its beneficiaries.
• Being a good steward of resources – All organizations aim to be efficient and reduce costs, but non-profits have specific pressures to keep operating costs low so that the majority of funding can go towards carrying out the mission. (And there are important metrics that people look at to evaluate this.)
• Creating a common language and context to operate effectively – Some non-profits, especially larger ones, work in a very large ecosystem with many different regions, countries and partners, so having a common language and a way to get one’s head around it all is important.

So how does business architecture help with all of that?

Simply stated:

• Business architecture translates ideas into action by:
  • Comprehensively cataloging all potential impacts of strategic direction
  • Creating a shared vision for the future
  • Defining the most important initiatives to achieve that vision
  • Supporting the strategic planning process to ensure that only the most important investments are made
  • Making sure that any initiatives and work occurring is aligned with the organization’s mission and top priorities
• Business architecture helps simplify complex environments
• Business architecture creates a common language and a high-level picture of what the organization does

P.S. You can brush up on the overall value of business architecture with Post No. 2.

Examples, please.

Here are just a few:

• A non-profit organization that focuses on vulnerable children in a developing country shifted how it achieves this mission from delivering goods to helping communities build sustainable businesses – Consider how business architecture could help to redesign the organization’s non-profit business model and also to identify, architect, plan and communicate a coordinated set of changes necessary to accomplish this major shift.
• A cross-sector initiative involving a government ministry, a university, non-profit organizations and private businesses (from multiple countries) was created to transform K-12 education in a developing country – Consider how business architecture could help to align these diverse partners around a common language, vision of the future and roadmap to achieve it—as well as to help them communicate with others to obtain advocacy, investment and partnership for the initiative.
• As a non-profit organization grew, there was not a common understanding of how gifts were handled in different situations, including decision-making criteria for gift acceptance – Consider how one business architecture value stream could be created to communicate and streamline gift receiving, and ensure that common decision-logic and capabilities are leveraged in all situations (along with the corresponding people, processes and technology).

How is architecting the same and different for non-profit and for-profit organizations?

Here’s what’s the same. The scope and principles of business architecture always apply, regardless of organization type or size. In other words, those business architecture domains like capabilities, value streams, organization, information, products, stakeholders, etc. all still apply. As do the principles behind how we create them. Of course, the content of the architecture is different for every organization.

But here’s what’s different for non-profits versus for-profit organizations:

• One. Motivations to do business architecture – As mentioned above, non-profits seek to achieve their missions and steward their resources as well as possible.
• Two. Terminology used in business architecture – For example, non-profits have beneficiaries and donors versus customers and investors.
• Three. Practicality of business architecture investment – At this point in time there could be more hesitation for a non-profit to invest in dedicated business architects due to the desire to keep operating costs low. (More on this shortly.)

BTW, a smaller non-profit organization shares dynamics reflected in both Post No. 17 (small versus large businesses) and Post No. 18 (non-profits versus for-profits).

And here’s a handy diagram to summarize all of that and draw a few comparison points between business architecture in non-profit organizations versus for-profit ones.

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Business Architecture: Non-Profit vs. For-Profit Organizations

Non-Profit Organizations

Motivations to Use Business Architecture

• Achieve mission to the greatest extent possible
• Be a good steward of resources
• Create a common language and context to operate effectively

For-Profit Organizations

Motivations to Use Business Architecture

• Successfully execute strategies
• Maximize shareholder value and profit
• Create a common language and context to operate effectively

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Common Areas to Apply Business Architecture for Value

• Starting: Designing a new organization and telling the story to attract donors/investors and partners
• Scaling and Transforming: Assessing impact, architecting changes to the organization and defining the initiatives necessary to achieve them (e.g. expanding or redefining products/services provided, expanding to new regions, etc.)
• Operating Effectively: Simplifying and increasing the efficiency of the business and technology operating environments

Areas of Differentiation

• Motivations to do business architecture (see above)
• Terminology used in business architecture (e.g. non-profits have beneficiaries and donors versus customers and investors)
• Practicality of business architecture investment (e.g. at this point in time there could be more hesitation for a non-profit to invest in dedicated business architects due to the desire to keep operating costs low—however considering the bigger picture, business architecture can reduce the overall operating costs and enable mission achievement)

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So why doesn’t every non-profit use business architecture today?

First, while business architecture is now really starting to take off globally, it is not widely used within non-profit organizations just yet—though there are some that do. This one is just a matter of time for adoption of the discipline to spread.

But we believe there is a second key reason, which is a bit trickier. This one has to do with the careful investment in operations and “overhead” versus those things that are directly related to achieving the mission (and rightfully so). However, while business architecture may be an additional internal cost, if we look at the bigger picture, it greatly increases an organization’s ability to achieve its mission and it can actually help to reduce the overall operating costs (e.g. by preventing a misaligned investment, by identifying opportunities to share resources, by saving time due to misunderstandings, etc.). Considering this perspective, we could even ask, is it responsible to run a non-profit organization without business architecture?

Here’s where we can ask ourselves, what if?

What if we could apply more of the rigor used in for-profit businesses, like business architecture, to non-profit organizations? How much more successful could they be in achieving their missions at scale?

But on the flip side, how much more successful could for-profit businesses be if they infused more social mission and responsibility into various aspects of their organizations?

What if donors and investors had a broader perspective on the big picture relationship between solid operational investments and an organization’s ability to achieve its mission faster and better?

What if we as architects could help to shift the paradigm?

Architecting For Good: Take Two.

Just in case you missed the last StraightTalk post, we would like to introduce the concept of “architecting for good.” At this point in time, most non-profit organizations (especially smaller ones) do not necessarily have the resources or expertise to do their own architecting. However, we know architects to be some of the most passionate people on the planet, who love to architect, solve problems, and make a difference to their organizations and the world.

If sharing your architecture (or other) talents to help a startup, small business, non-profit, social enterprise or other social initiative is of interest to you, we’d love to hear from you! Here is a short 2-minute survey to help us understand more about you—what talents you possess, what you’re passionate about contributing, and what aspirations you have to get involved.

Take Our Short Survey >

This is a wrap for the last StraightTalk of the year. It has been a true pleasure to share this journey with you and we wish you the happiest of holidays this season!

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More Good Stuff

The Paradox of Generosity (Book by Christian Smith and Hilary Davidson): Just in time for the holiday season. A fascinating little book that links acts of generosity with improved health and happiness. In giving we receive, in grasping we lose.

Solving the World’s Biggest Problems: Better Philanthropy Through Systems Change (Stanford Social Innovation Review): How non-profits and philanthropists are embracing the principles of systems change as an effective way to solve the world’s biggest problems. Consider what a tremendous enabler business architecture could be to facilitate this type of big-picture thinking and collaboration.

TED Talks On Generosity: A collection of great talks on the hows, whys and whats of generosity. Make sure to check out the one by Dan Pallotta on The Way We Think About Charity Is Dead Wrong, as he makes a good case for applying some business thinking to the non-profit world for maximum impact.

We loved our guest star series and we’re feeling smarter already. Now we’re switching gears for a couple posts to look at business architecture within some different contexts. Here in StraightTalk post. No. 17, we’re going to look at using business architecture for startups and small businesses.* Let’s go.

* What’s the diff? A startup is a temporary organization in search of a repeatable and scalable business model. They aspire to build. Per the United States Small Business Administration, a small business is independently owned and operated, organized for profit, and not dominant in its field.

Does business architecture really apply to a startup or small business?

Business architecture is beneficial to any size of organization—from a sole proprietor to a large global organization. It is also beneficial to any type of organization—including for-profit, non-profit and governmental organizations.

No matter what an organization’s type or size, it has the best chance of success with:

• A viable and competitive business model
• An intentionally designed organization
• A way to set and execute direction

Business architecture can help with all of these.

So yes, business architecture does indeed apply to startups and small businesses.

How exactly does it apply then?

Startups and small businesses care about things like getting started and scaling up—especially when their owners have taken big risks and need to prove themselves and continue to make ends meet along the way. They care about designing an organization that can compete, scale and be sustainable. They need to be really good at telling their story to attract customers, investors/donors and partners. Once their business model has been proven successful, they need to scale quickly and effectively. And no matter what the phase, they always need to be good at turning ideas into action.

(By the way, while the organizations may have different focuses, a small non-profit organization has similar needs.)

Give me some examples.

Here are a couple real ones:

• A free newspaper aimed at activating citizens in a developing country wanted to scale up its distribution ten times to meet the nation’s needs. Business architecture was used to identify the changes necessary to scale (e.g. creation of new revenue streams, procuring a printing press, relocating headquarters, hiring new types of staff, etc.) as well as develop a roadmap to make it happen.
• A non-profit organization that provides holistic health solutions to communities in a developing country wanted to spin off a new for-profit company to sell a unique electronic medical records solution for remote areas, with the profits feeding back into the non-profit organization. Business architecture was used to help the owner envision and design the new company (including interactions with the non-profit), share a clear vision with partners (which resulted in significant commitments such as one partner writing the software at no cost), and create a roadmap to rollout the solution across all regions in the country.

Is architecting for a small organization any different than architecting for a larger one?

Let’s start with what is the same. The scope and principles of business architecture are the same. In other words, those business architecture domains like capabilities, value streams, organization, information, products, stakeholders, etc. all still apply. As do the principles behind how we create them. Of course, the content of the architecture is different for every organization.

PS: If you’re looking for a refresher on these, you will find StraightTalk Posts No. 1, No. 12 and No. 13 to be handy for that.

Okay, what’s different when architecting for a small organization then?

There are three things that tend to be different with a smaller organization.

• One. There tends to be a focus on value streams and capabilities (though any domain may be used)—and they may be created at various levels of completeness—with just enough to fit the purpose. They may also be created and/or presented within the context of other things like a business plan or presentation.
• Two. A small organization needs to draw upon a variety of models and techniques to help them start and scale (e.g. experience design, business model canvas, design thinking, etc.) and business architecture is just one part that should not be overemphasized in this context.
• Three. Related to number two, in a small organization, there is likely not a dedicated business architect. Creating and using business architecture is just one focus among many for the team member who is responsible. (Unless the organization gets outside help.)

Remember the reality here in this situation—it’s just enough, just in time to help the small organization. It’s not about creating a full blown architecture until it’s needed. In the beginning, every minute counts, especially when the entrepreneur is focused on being able to pay next month’s rent and achieve their dreams. The business architecture can be expanded later on when the time is right.

Below is a handy diagram to summarize all of that and draw a few comparison points to business architecture in larger organizations.

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Business Architecture Differences Based on Size of Organization

Smaller Organizations

• Designing new organization with competitive business model
• Telling the story to attract investors/donors and partners
• Scaling up organization
• Continually improving

• High level with a focus on value streams and capabilities
• Likely created and/or presented within the context of other things like a business plan or presentation
• Other models and techniques are also emphasized (e.g. business model canvas)

•  Broad – No dedicated architects; business architecture is one skill set among many

Larger Organizations

• Merging with or acquiring an organization
• Creating a spinoff organization
• Transforming
• Expanding
• Executing new strategies
• Innovating
• Simplifying
• Digitalizing
• Continually improving

• Full set of business architecture domains are used to the level of depth needed

•  Specialized – Named business architects focus only on business architecture

So why doesn’t every startup and small business use business architecture today?

That’s one of those million dollar questions. We think that it’s just not on the radar or in the psyche. It’s not embedded in the playbook of how things are usually done when you start an organization. BUT, our very connected world is starting to illuminate a new importance for the big picture, systemic, architectural thinking. And we have a lot more evidence for what happens when a company grows without it, leading to tremendous inefficiency (e.g. from the redundant processes and systems that were built) and an inability to react to the market and execute strategies later on.

Here’s where we can ask ourselves, what if?

What if we architected our organizations with intention from the very beginning?

What if investors required a more rigorous view of an organization’s business model, architecture (business and technology) and plans as part of their selection process?

How much better and quicker could organizations scale—and how much more successful could they be—if we architected them as we go instead of using architecture to fix the problems that inevitably arise later? 

What if we as architects could help to shift the paradigm?

Architecting For Good

At this point in time, startups and small businesses do not necessarily have the resources or expertise to do their own architecting. However, we know architects to be some of the most passionate people on the planet, who love to architect, solve problems, and make a difference to their organizations and the world.

What if our architecture community applied our talents and passion for architecting organizations to help the startups and small businesses we care about? Or the non-profits, social enterprises and other types of organizations we care about?

How much more impactful could these organizations be with our help? And how much better might we learn our craft and experience our own personal transformation during the process?

Are you in?—If sharing your architecture (or other) talents to help a startup, small business, non-profit, social enterprise or other social initiative is of interest to you, we’d love to hear from you! Here is a short 2-minute survey to help us understand more about you—what talents you possess, what you’re passionate about contributing, and what aspirations you have to get involved.

Take Our Short Survey >

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More Good Stuff

Social Enterprise: The Evolution of Business, Sustainability, Starting Up and Scaling Up (Metanoia Global): A short presentation on how business is evolving and how intentionally architecting organizations can help them to start and scale successfully, including a case study.

Architecting for Good (S2E Transformation, Inc.): Learn more about the idea of leveraging business architecture and other techniques to help non-profit organizations, startups, social enterprises and cross-sector social initiatives to achieve their missions.

Discover Your True North (Book by Bill George): On becoming a leader who serves a greater purpose.

Body of Work: Finding the Thread That Ties Your Story Together (Book by Pamela Slim): More and more people are blending big company jobs, startup gigs, freelance work and volunteer side projects. This book provides a great perspective on finding and leveraging the connections among your diverse accomplishments, selling your story, and continually reinventing yourself.

How To Know Your Life Purpose in 5 Minutes (TED Talk by Adam Leipzig): Now that is a StraightTalk approach. And it’s spot on.