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CHAPTER 3, ENTERPRISE IT ARCHITECTURE'S THREE LAYERS, Architecture as…

- - - - Firmwide digital plumbing used by all line functions and apps
        
        IT infrastructure architecture is their firm wide arrangement
        
        Relatively stable, generic commodity, and rarely a competitive differentiator
      - Consumes over 50% of corporate IT budgets
      - Must be reliable but economical – Key choice: Level of centralization
      - Non-IT contributions
        
        Is frugality or tailoring more important for their units?
        
        Define “good enough” operational performance?
- - - - App architecture = choosing where to locate the three pieces
        
        Like arranging pieces on a chessboard
        
        Like arranging pieces on a chessboard
        
        Has irreversible operational and strategic consequences
      - Three Arrangements ~ App Architectures
        
        Cloud architecture
        
        All heavy lifting is done on the server side via the “cloud” (e.g., Siri)
        
        :check: Clients can be feeble & cheap ~> only input and display information
        
        :check: :green_cross: Centralizes everything
        
        :check:Easy maintenance ~ only a central copy needs updating
        
        :check:Low upfront costs ~ utility-like model
        
        :green_cross: Ongoing, variable operating costs replace upfront costs
        
        :green_cross: A single point of vulnerability
        
        :green_cross: Strategically undifferentiating (common providers)
        
        Client-server Architecture
        
        Centralizes only data; clients do heavy lifting
        Most common in corporate portfolios; predates cloud
        
        :check: Offers more potential for competitive differentiation
        
        :green_cross: Costlier if custom-built ($15-$40 per line + 700% maintenance)
        
        :green_cross: Burdensome upgrades
        
        Two newer cloud-inspired variants enable building cheaper, faster custom apps
        
        Service-oriented architectures: Some server-side functionality purchased as a service, integrated into custom apps
        
        Micro-services: Many discrete generic services cobbled into an app’s logic
        
        Peer-to-peer Architecture
        
        No central server ~> every client performs all app functions
        
        Every client simultaneously acts as a little server for all other clients
        
        Strength in numbers; every new client increases the hive’s collective capacity
        
        :check: Infinite, dirt-cheap scalability
        
        Reason for 100-fold user cost difference between Facebook (cloud) vs. Skype (peer-to-peer)
        
        :green_cross: Zero control over user devices relegates it to niche, eclectic uses
        
        Why Netflix needing scalability avoids it
        
        Recommended only for scale-hungry apps that demand no control
      - Centralized <~ Cloud ~ Cloud Server ~ Peer-to-Peer ~ > Decentralized
      - Every App Architecture is a Tradeoff
        
        None optimal because every one of them involves tradeoffs
        
        Non-IT managers must weigh in on…
        ~Rank order operational priorities for your business activities
        ~Acceptable tradeoff in operational performance to avoid a strategic penalty later?
- - - - All apps collectively determine how a firm’s data assets are organized and where they are located
        
        Data warehouses assemble copies of data to integrate siloed data
        ~ Library of Congress for books
    - - To pick appropriate data architectures, non-IT managers must decide:
        
        What data should be centralized firmwide for executing your core business processes or for analytics?
        
        What data must be shared across your markets?
- - - - Fast, reliable
- - - - Architecture
        
        cost constraints possibilities
        
        Constructed home
- - - - IT architecture
        
        cost constraints possibilities
        
        IT project