What’s the size of an enterprise?

What’s the size of an enterprise? Perhaps more important from a pragmatic perspective, what’s the minimum size of enterprise where an enterprise-architect might be needed?

Starting-point for this one was one of those long, tangled LinkedIn threads that wander around in and off topic for weeks on end. Or, in this, case, actually two of them: the first had gone so far off-topic at this point that it doesn’t really matter what the original topic was, but the other much-smaller thread was about the relationship between theory and practice in EA. Where they came together, in my mind, was a discussion about the size of organisations where EA would be relevant, and, from the other LinkedIn thread, whether theory or practice came first in deciding this.

One of the correspondents on the first thread had no doubts about either point. To him, as he’s shown many times on LinkedIn, theory always comes first, and only theory from ‘Great Authorities’ at that:

We could also have a business model, business strategy, org-chart, etc. and have a business and not an enterprise. Veblen did not find home businesses, which in his day included craftsmen, to be enterprises. A craftsmen though could have all these things and not have anything that we would associate with something even resembling an enterprise.

(A personal aside: I really dislike and distrust that type of ‘The-Great-Authorities-Have-Defined-All-Truth’ approach. Kinda reminds me of the clash between the practice-oriented Phaedrus and the extreme-Aristotelian ‘Chairman of the Committee for Analysis of Ideas and Study of Methods’ in Robert Pirsig’s Zen and the Art of Motorcycle Maintenance… – no prizes for guessing which side of that argument I prefer!)

In that interpretation above, an ‘enterprise’ is defined not merely as always and only a commercial business, but also a sizeable one – giving us an arbitrary yet blurrily-indefinite boundary between ‘enterprise’ and ‘not-enterprise’. Which, to my mind, doesn’t necessarily match up with reality, or, for that matter, with the more human-oriented noun-definition that Chris Potts likes to quote, that ‘enterprise’ is “the animal spirits of the entrepreneur”.

At this point Nick Malik came back in, with a more pragmatic view:

From now on, when I say the word “organization” and “enterprise,” please interpret my meanings to be that of a “business, non-profit, semi-governmental, or governmental organization of sufficient size and complexity as to require the assistance of dedicated professionals to manage it and drive it to adapt to changing marketplace conditions.”

Let’s not argue about the corner cases. They are not important to the discussion. Let’s all work within the space of “talking about a reasonably understood, if not precisely defined, set of enterprises that may need our services.”

Which got me thinking about that point about theory-versus-practice. Because when I look at my own work, in terms of practice rather than theory, it actually does give me a clear – if only personal – answer to that question “What is the size of enterprise that may need our [EA] services?”

What’s the top limit on size for EA? Almost none, in practice. The largest organisation I’ve personally consulted for, at senior level, had something like 150,000 employees. I know others who’ve done EA work at senior level for organisations perhaps ten times that size, maybe more.

What’s the bottom limit on size for useful EA? Again, almost none, in practice. One of the smallest organisations I’ve consulted for – using essentially the same EA guiding-models and techniques as for that larger organisation – was this weekend, a well-established restaurant with two branches at present, and about 20-30 employees. They’re looking to clarify and rework their vision, values, business-model and operating-model prior to starting up a new branch in a new city.

In practice, the size of organisations I do EA-work with can be almost anywhere between those extremes. The main consultancy-gig for next week is with a global aircraft-manufacturer. The one after that, a small non-profit. The next currently scheduled after that is one of largest banks in the country. Up and down, up and down – almost any size at all.

And there’s nothing unique in this. If we contrast the book Business Model Generation to its recent counterpart Business Model You, what are essentially the same business-model techniques apply to the business of any size of enterprise, right down to the personal enterprise of a single individual. For me, the same is true not just for business-models, but for all types of EA-work: it can apply at any scale, right down to the personal enterprise of a single individual.

So although, yes, theory and practice each inform each other, and intertwine with each other, for me, in practice, practice usually comes first. In a practice that’s as wildly diverse as EA so often seems to be, theory can indeed be a useful tool, but it should never be allowed to dominate how we think and work – or try to tell us how our clients ‘ought to’ think and work, either.

Hence, to be blunt, I don’t give a damn about what Veblen or any other supposed ‘Great Authority’ claims is the minimum size for a ‘real’ enterprise.

I do give a damn about what my clients think is their enterprise, and where they want to take it.

Simple as that, really.

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Posted in Business, Enterprise architecture
5 comments on “What’s the size of an enterprise?
  1. Great as always. I engage with anything that is a “system”. Any system is big enough to justify Enterprise Architecture. :)

    • Tom G says:

      @Kai: “I engage with anything that is a “system”. Any system is big enough to justify Enterprise Architecture.”

      Yep. The boundary between ‘enterprises I work with’ and ‘enterprises I don’t work with’ as an EA is, in classic systems’-fashion, entirely recursive: it’s the boundary between the enterprises I work with and the enterprises I don’t. :-)

  2. Gene Hughson says:

    Well said. Veneration of “authorities” tends to betray a lack of intellectual vigor, in my opinion. We would not have been issued brains were we not supposed to use them.

  3. Peter Murchland says:

    The only thing that dictates size of enterprise is whether value can be offered – for smaller, coherent enterprises, there is a lower probability of being able to add value.

    Having said that, one of my most challenging EA assignments was for an enterprise of 40 people – mainly due to the total lack of coherence, collaboration and effective communication amongst the four members of the leadership team.

    A minor aside – an enterprise does not need to be constrained to organisational boundaries. I have done EA work for the criminal justice sector which cuts across parts of some organisation and the entirety of others. I have also done EA work in an industry context, a state/province/region context and in a nation (not national) context.

    • Tom G says:

      Peter -

      para 1: yep, exactly.

      para 2: yep – been there, done that (painfully…).

      para 3: again, strong agree. The same point is made in ISO 42010 (I believe? – if not, it’s certainly in FEAF, which I think drew its definition from IEEE-1471, the precursor to ISO-42010), which explicitly states that an enterprise may extend beyond an organisation’s borders. It does imply, though, that the enterprise-boundaries are still constrained to those of some kind of meta-organisation such as a consortium (or, in your case, up to a country) – in other words, that the boundaries of the enterprise must coincide with some kind of ‘organisation’. I’m not sure about: I’d prefer to suggest that whilst the two types of boundaries can coincide. they don’t have to. Instead, I prefer distinct definitions for each: that an organisation is a kind of ‘legal’-type entity bounded by rules, roles and responsibilities, whereas an enterprise is more an ‘emotive’-type entity, bounded by vision, values and commitments – and they’re not the same as each other.

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