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Business value

As explained in Architecture Modernization: Socio-technical alignment of software, strategy, and structure

An impact is a change in behavior or measurable effect expected to contribute to a business goal.

Business value is the measurable business effect an initiative or product is expected to create, such as revenue, customer retention, money, data, productivity, or lower operating costs. It connects technical and architectural decisions to outcomes that matter to customers, the organization, and its strategy. section 6.1.3 section 1.1

Assess business value by asking what outcome is created and for whom:

  • Customer value can include improved productivity or increased sales. section 6.1.3
  • Business value can include money and data, while internal products may create productivity gains or reduce operating costs. section 6.1.3
  • Value should be balanced with quality, speed of learning, safety, governance, risk, security, compliance, and people’s experience. section 1.1

Choosing strategic IT

An architecture modernization proposal becomes more credible when its technical change is connected to differentiation and measurable business impact. Wardley Mapping can identify candidate areas, but each candidate still requires detailed examination of how it contributes to strategy; commodity capabilities are less likely to offer differentiation. section 10.1.2 section 2.1.6

Figure 1.3 Better Value Sooner Safer Happier. (Source: Smart et al., Sooner Safer Happier: Antipatterns and Patterns for Business Agility [Portland, OR: IT Revolution 2020])

Use the BVSSH model to compare how a decision affects value alongside quality, speed, safety, and stakeholder experience. section 1.1

How Architecture Modernization: Socio-technical alignment of software, strategy, and structure covers it

How deep it goes
Defines business value with concrete outcomes and mapping guidance, then stops short of prescribing measurement formulas or implementation techniques.
Examples
Uses money, data, productivity, sales, reduced operating costs, revenue, and customer retention as concrete value examples.
What it assumes
Assumes awareness of the business domain and product strategy while encouraging technologists to learn that context from zero.
What you can do after
Evaluate and communicate how technical proposals, products, and IT capabilities contribute to strategic business outcomes.
How it connects
Ties business value to products, customer value, business outcomes, domain boundaries, Wardley Mapping, strategic IT, and architecture modernization.

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Related concepts

This explainer was generated by Manning's knowledge graph from the text of Architecture Modernization: Socio-technical alignment of software, strategy, and structure. The section links point to the parts of the book it draws on.