I made an interesting mistake, today… one that comes up from time to time. I used a business term in one way, and some members of my audience understood what I meant, while others did not. In this case, the word was “core”. The word has two different definitions. Unfortunately, the definitions are quite different, at least in an Enterprise Architecture context.
The dictionary definition of “core” reflects the problem. Bing dictionary defines “core” as the “central” or “most important” part of something. Notice the word “or.” Either meaning can be intended.
This goes to an old idea of putting the most important part of something in the middle. In ancient kingdoms, the capital city was often very centrally located, usually near a convenient transportation route (like a river) that offered quick access to all parts of the kingdom (within reason). So, the word core can mean “most important” or it can mean “in the middle.” In the past, those two meanings were synonymous.
But in business, the thing “in the center” is not the most important thing. Porter illustrates this with his (now famous) value chain model:
Porter’s Value Chain. Image source.
What is the most important part of that model? It’s the bottom-half, illustrated as the “primary activities” or value chain. Porter is smart enough to avoid the word “core” because it has the connotation of “in the center” when he wanted to illustrate that value chains are not “in the center.” They traverse “end-to-end”.
Porter seems to be somewhat alone in avoiding the term “core.” Many business books and resources use the term “core” when referring to the primary activities. There are countless illustrations, if you bing for images with the search phrase “business core”, where you are looking either at a set of service offerings or a value chain. The following diagram is a business architecture reference model for the hospitality industry. The name of this model: Core Business Domains and Processes.
Core Business Domains and Processes – Hospitality Technology Next Generation Reference Architecture
On the other hand, there are also illustrations of business where “shared” items are at the center, and non-shared items are “at the edge”. Illustrations like this one are also quite easy to find:
Source: United Nations Office for the Coordination of Humanitarian Affairs
In business architecture, do we illustrate “core” things to be “shared things at the center of a circle” or do we mean “core” to be “the most important things?”
In Enterprise Architecture, the distinction becomes more problematic. Shared things are often the LEAST important thing from the perspective of the business, not the MOST important thing. For example, the HR department is often a shared function, and unless the company is an HR service provider, that business function is not part of the value stream. On the other hand, from the perspective of information architecture, the shared things are the most important and the non-shared things are the least important. For example, a single understanding of “customer” is critical, especially when that understanding is shared across marketing, sales, and customer service. It is shared, common, and very important.
Now, add a specific use of the word “core” that is used in EA: the notion of a “core diagram” as described in the book “Enterprise Architecture As Strategy” from Ross and Weill. In that sense, the diagram itself may vary depending on which one of the operating models is being used, but the model itself is a shared, common understanding of the key items that are shared (whether that is process, information, or both). In that case, the thing that is important is the thing that is shared. That is called “core.”
Two years ago, I made a presentation to the Open Group conference about creating core diagrams using a method I created called “Minimum Sufficient Business Integration.” In that method, I use the word “core” many times to refer to “shared” items that are central to an organizations’ Enterprise Architecture.
So, what definition should I use for “core” when having a discussion about business and enterprise architecture? Should the word “core” refer to “the most important” thing, or “the most shared” thing?
I don’t have a good answer. Perhaps the best answer is to avoid the word “core” altogether.
7 thoughts on “Business Architects: What’s at the “core”?”
I think you answered your own question. Use whatever term leaves your audience understanding what you mean to express. In this case, referring to “the most important” thing, or “the most shared” thing discretely and as appropriate seem suitable. 🙂
Nick, to me the term core, in the physical sense, is the "centre" of something. In the abstract sense, it means the "central" function of something, that is the more important part.
Anyway, since most models have no physical centre, unless they are round or there about, the abstract sense prevails.
For most people it means "key", that is the most important thing or things in a system of things, for instance the key (or core) processes of an enterprise.
Still, depending on viewpoint, the most important part of model could be the shared functions. Or it could be the " manufacturing" etc.
Alex: unfortunately the word 'core' is baked into some of the terms we use, so I may have to use the word, and quickly define it, as I go.
Adrian: I think you modeled the problem well. Unfortunately, the one person that I fail to communicate with may end up being the most critical somewhere down the line. So counting on logic or deferring to what "most people" believe can be hazardous.
When we hear business people saying things like "common core" or "remaining true to to the fundamentals of our business" we need to explore more and not simply assume that we think that we know what they mean
Nick, in any case, since core means central in one sense (physical) or another (abstract) you were right.
It is true though that the most important function might not be in the physical center or too often there is no physical center. In fuzzy cases then, you may qualify "core" by adding the sense, abstract or physical.
Anyway, in my experience, there is no 100% agreement ever. There will always be some who disagree since they have a different view, a more mechanical thinking or reasons to disagree with you, such as dislike or show off, rather that with what you say.
Say you use term "key" for instance. Some mechanicists may think then that you are speaking about a door. But that's the nature of language. It is rare the word that has a single meaning. The meaning has to be taken in the semantical context. That's what speech recognition is about.
I hope you don't discount logic or what the majority says because somebody may disagree with you down the line.
For simplistic strategic frameworks like OCHA, concentric rings show best the convergence from objectives to goals. So naturally, core not only means important but also central.
For Value Chains where there is a natural sequence, core means key/primary processes because there is no physical centre anyway and perhaps they are all at the center of the enterprise functionality.
What is worth debating though is what is core in the context of "core competencies" of an enterprise, how are they different, if they are so, from core capabilities and if they are all outsourceable.
How about using the terms as Geoffrey Moore proposed? If your audience is business folks they must be familiar with the concepts:
Core and context
Core is any activity that creates sustainable differentiation in the target market resulting in premium prices or increased volume. Core management seeks to dramatically outperform all competitors within the domain of core.
Context is any activity that does not differentiate the company from the customer's viewpoint in the target market. Context management seeks to meet, but not exceed, appropriate accepted standards in a productive a manner as possible.
In my consulting work, I tagged on "Commodity" to the list and ask the clients to force prioritize "Core capabilities" "Context capabilities" and "commodity capabilities" with the idea that you invest into core, standardize the context, and outsource the commodity.
Shared is not the opposite of core. So, I think there is no harm in sharing the core.