Over the two decades of my career at Microsoft as the head of architecture for the .NET platform, Visual Studio. NET, Application Platform, Business Strategy, and Microsoft Digital, I’ve been involved in creating technologies for several waves of platforms: the early networked, service-oriented ones called Web 2.0, and more recently the cloud.
While there is no doubt that the previous waves of platform technologies have brought significant benefits, their impact has been limited because they are “passive” stacks that act as tools for applications and infrastructure. For the most part, with previous waves of platforms, cost savings have been the main, and sometimes the only, measurable component of business results.
Blockchain platforms are unique because, for the first time in the world of computing, we have a technology platform that has an inherent economic model – incentives, rewards and penalties for every object, person and system – inherently “hidden” in architecture. Unlike the “dormant” technology gaps of the past, the blockchain chain marks the emergence of new economic platforms.
How does this violate the company’s IT architecture? The first is retroactive.
Looking Back: Architectural Models of the Old School Foundation
We can say that the field of corporate engineering began in 1987 with the publication of an article by John Zachman “A Framework for Information Systems Engineering” in the IBM Systems Journal.
In his background paper, Zachman outlined the need and challenges for corporate structures: rapidly growing IT budgets and the fact that business success is now increasingly dependent on technology require a systematic approach to address the increasing complexity of IT applications and infrastructure.
There are three main approaches to plant design:
A forward-looking approach brings out different perspectives within and within an organization. The framework that this approach usually represents is Zachman’s framework for enterprise architectures. Here, the corporate architecture functions as an integrated diagram of the organization and describes it from several points of view (planner, designer, etc.). It is built on a perspective as it meets the needs of different stakeholders and their different perspectives.
The Process Oriented Approach explains the procedures that define and deliver IT results. The methodology that usually represents the second approach is the Open Group Architecture Framework, or TOGAF. It is perceived as a rigorous model of the company’s needs, structures, information, processes and systems for decision making. The process is structured in such a way that it attempts to accurately depict the process used to model the organization.
A standards-based approach defines and prescribes the use of standards throughout the organization. The model that usually represents the third approach is the Federal Enterprise Architecture or FEA. It emphasizes the need to identify standards-based patterns and practices (reference models, generic services, etc.) that are defined and well understood within and across the organization, and communicate these entities for compliance and governance.
The understanding and vision that business value and agility can be effectively achieved through a holistic approach to IT engineering has shaped the IT industry over the past three decades. However, what is lacking and what stopped information technology is the lack of economic principles or thinking in all previous approaches to business structures.
What does the new (financial) project architecture look like?
Looking to the future: the new financial structure of the company.
Ronald Coase defined a company as “a system of relationships that is created when the direction of resources depends on the entrepreneur.” The study of companies expanded significantly when Oliver Williamson opened the black box to understand companies as institutions. Based on this work, Douglas North argued that institutions create important constraints and opportunities, and therefore incentives.
Business is economic business. To be relevant (and absolutely practical), a project architecture must reflect the underlying economic model or models that serve as the basis for the project. It has been said that most economies can be summed up in one word – incentives, and the new economic structures of the company clarify this principle.
With this approach, the approach models supported by blockchain platforms, rewards and penalties (commonly referred to as “tokens”) for every object, person, and system within and throughout the business are internal to the enterprise architecture and are applied programmatically (through smart contracts).