Do Startups Need Enterprise Architectures?

And by implication, do they need Enterprise Architects?

For the last few years I have been meeting with startup and scaleup founders, in and around my local community of Birmingham in the United Kingdom, offering thoughts and advice on how they should be thinking about the software and systems architectures of the applications and platforms they are looking to build. Inevitably, as the discussions proceed and we discuss not just what they need now (the minimum viable architecture if you like) but what they might need in the future, as they hopefully scale and grow, the question arises of how and why they need to worry about architecture now and can’t leave it until later when hopefully they’ll have a bit more investment and be able to hire people to do it “properly”.

To my mind this is a bit of a chicken and egg type question. Do they set the groundwork properly now, in the hope that this will then form the foundation on which they grow or, do they just hack something together “quick and dirty” to get paying customers onto the platform and only then think about architecture and go through the pain of moving onto a more robust platform that will be future proof? Or do they try and have their cake and eat it and somehow do a bit of both? Spending too much time on pointless architecture may mean you never get to launch because you run out of time or money. On the other hand if you don’t have at least the basics of an architecture you might launch but quickly collapse if your system cannot support an unexpected surge in users or maybe a security breach.

These are important questions to consider and ones which need to be addressed early on in the startup cycle, at least to the degree that if an enterprise architecture (EA) is not laid out, the reasons for not doing so are clear. In other words has an architecture decision been made for having an EA or not?

No startup being formed today should consider that IT and business are separate endeavours. Whether you are a new cake shop selling patisseries using locally sourced ingredients or a company launching a new online social media enterprise that hopes to take onFacebook, IT will be fundamental to your business model. Decisions you make when starting out could live with you for a long, long time (and remember just five years is a long time in the IT world).

Interestingly it’s often the business folk that understand the need for doing architecture early on rather than IT people. Possibly this is because business people are looking at costs not just today but over a five year period and want to minimise the amount of IT rework they need to do. IT folk just see it as bringing in new cool toys to play with every year or so (and may not even be around in five years time anyway as they are more likely to be contract staff).

Clearly the amount of EA a startup or scaleup needs has to be in proportion to the size and ambitions of the business. If they are a one or two man band who just needs a minimum viable product to show to investors then maybe a simple solution architecture captured using, for example, the C4 model for software architecture will suffice.

For businesses who are beyond their first seed rounding of funding and are into series A or B investment then I do believe they should be thinking seriously about using part of that investment to build some elements of an EA. Whether you use TOGAF or Zachman or any other framework doesn’t really matter. What does matter is that you capture the fundamental organisation of the system you wish to build to help offset the amount of technical debt you are prepared to take on.

Here are some pointers and guidelines for justifying an EA to your founders, investors and employees.

Reducing Your Technical Debt

Technical debt is what you get when you release not-quite-right code out into the world. Every minute spent on not-quite-right code counts as interest on that debt. The more you can do to ensure “right-first-time” deployments the lower your maintenance costs and the more of your budget you’ll have to spend on innovation rather than maintenance. The lower, in other words, are your technical debt interest repayments. For a scaleup this is crucial. As much of every dollar of your investment funding that can go on marketing or innovating your platform leads to an improved bottom line, more customers and overall making you attractive to potential buyers. This leads to…

Enhancing Your Exit Strategy

Many, if not most, startups have an exit strategy which usually involves being brought out by a larger company making the founders and initial investors rich beyond their wildest dreams enabling them to go on and found other startups (or retire onto a yacht in the Caribbean). Those large companies are going to want to see what they are getting for their money and having a well thought through and documented EA is a step on the way to proving that. The large company does not want to become another HP who got its fingers badly burnt in the infamous Autonomy buyout.

To Infinity and Beyond

Maybe your founder is another Mark Zuckerberg who refuses the advances of other companies and instead decides to go it alone in conquering the world. If successful there is going to be some point at which your user base grows beyond what you ever thought possible. If that’s the case hopefully you architected your system to be extensible as well as manageable to support all those users. Whilst there are no guarantees at least having the semblance of an EA will reduce the chances of having to go back to square one and rebuilding your whole technology base from scratch.

Technology Changes

Hardly an Earth shattering statement but often one which you tend not to consider when starting out. As technologists, we all know the ever increasing pace of change of the technology we deal with and the almost impossible task of keeping up with such change. Whilst there may be no easy ways to deal with the complete left-field, unexpected (who’d have thought blockchain would be a thing just 10 years go) having a well thought through business, data, application and technology architecture which contains loosely coupled components with well understood functionality and relationships at least means you can change or upgrade those components when the technology improves.

K.I.S.S (Keep It Simple Stupid)

It is almost certain that the first version of the system you come up with will be more complicated than it needs to be (which is different from saying the system is complex). Anyone who invests in V1.0 or even V2.0 of a system is almost certainly buying more complexity than they need. That complexity will manifest itself in how easy (or not) it is to maintain or upgrade the solution or how often it fails or under-performs. By following at least part of a well thought through architecture development method (ADM) which you iterate over a few times in the early stages of the development process you should be able to spot complexity, redundant components or ones which should not be built by you at all but which should be procured instead as commercial of the shelf (COTS) products. Bear in mind of course that COTS products are not always what they seem and using EA and an ADM to evaluate such products can save much grief further down the road.

It’s All About Strategy

For a startup, or even a scaleup, getting your strategy right is key. Investors often want to see a three or even five year plan which shows how you will execute on your strategy. Without having a strategy which maps out where you want to go how will you ever be able to build a plan that shows how you will get there?

Henry Mintzberg developed the so called 5P’s of Strategy as being:

  1. Strategy as Planning – large planning exercises, defining the future of the organisation.
  2. Strategy as a Ploy – to act to influence a competitor or market.
  3. Strategy as a Position – to act to take a chosen place in the chosen market.
  4. Strategy as Pattern – the strategy that has evolved over time.
  5. Strategy as a Perspective – basing the strategy on cultural values or similar non-tangible concepts.

For startups, where it is important to understand early on your ploy (who are you going to disrupt), your position (where do you want to place yourself and what differentiates you in the market) and perspective (what are your cultural values that makes you stand out), an EA can help you formulate these. Your business architecture can be developed to show how it supports these P’s and your technology architecture can show how it implements them.

As an aside one of the most effective tools I have used for understanding strategy and mapping and deciding what should be built versus what should be bought are Wardley maps. Not usually part of an EA or an ADM but worthwhile investigating.

So, in summary, whilst having an EA for a startup will in no way guarantee its success I believe not having an EA could inhibit its smooth growth and in the long run cost more in rework and refactoring (i.e. to reduce the amount of technical debt) than the cost of putting together, at least an outline EA, in the first place. How much EA is right for your startup/scaleup is up to you but it’s worthwhile giving some thought to this as part of your initial planning.

 

 

One thought on “Do Startups Need Enterprise Architectures?

  1. Thanks for encouraging startups to consider their enterprise architecture!

    After all, it defines their chosen setup for effectively executing their business model. As such, it impacts the resource consumption required for developing, marketing, selling and supporting their products and services, and managing the business on a day-to-day basis.

    Startups have limited resources, so establishing a suitable enterprise architecture early should enable faster growth.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s