Some enterprise architects face layoffs with COVID cost cuts
Some companies are reducing their enterprise architecture teams or reassigning staff to other IT tasks to cope with budget tightening in the wake of the coronavirus pandemic.
Budget tightening linked to the COVID-19 pandemic has pushed some businesses to lay off enterprise architects or shift them to more pressing IT duties, industry analysts and tool vendors said.
Anecdotal reports show a U.K.-based cruise company halved its business architecture team, two Canadian government departments moved enterprise architects to other IT work, and an undetermined number of additional companies laid off or reassigned architects as they try to cope with uncertain economic conditions. Enterprise architecture tool vendors' estimates of the job reductions affecting their customers ranged from negligible to 40%.
"This is the time when you find out how much your company really values your job and your contributions," said Ryan Schmierer, director of operations at Sparx Services North America, a training and consulting division of the enterprise architecture tools vendor. "Architects that have just been creating corporate artwork that isn't useful are sitting there idle right now, and many of them are getting laid off."
Schmierer estimated that 40% of Sparx Systems customers have laid off or redeployed at least some of their enterprise architects in view of pandemic-related budget constraints. He said about 20% are hiring, and the rest have turned to outsourcing to meet their architecture needs or augment their staffs.
"We've seen some companies say, 'Wow, our architects are our most valuable team. We need more of these guys.' And they're struggling to recruit and staff during this period of time," Schmierer said. "We've had other companies that weren't well organized basically give up and say, 'We're just going to lay them off and try this again later.'"
Schmierer said one customer decided to disband its centralized team and distribute architecture work to IT and business groups after encountering challenges in a remote work environment. He said he expects the company to bring back a centralized architecture team in the future, based on his experience with past cases of companies centralizing or decentralizing and hiring or laying off staff on a two- or three-year cyclical basis. He said architects tend to be the first to go if the budget tightens and the team has not demonstrated value to the business.
Pandemic is 'litmus test'
"We're seeing a lot of architecture teams in flux right now. The pandemic is a great litmus test for how successful you've been as an architectural practice and as an individual architect," Schmierer said. "You don't need a performance evaluation. Just look at your meeting calendar. It's very obvious who's been adding value."
Betsy Burton, a vice president and fellow at Aragon Research, said pandemic-related losses of enterprise architect jobs are not surprising, because the same thing happened during the 2008 economic crisis with organizations that were not using enterprise architecture in an effective way.
Ryan SchmiererDirector of operations, Sparx Services North America
"There were senior executives that looked to their enterprise architects and [said,] 'We can't figure out what you guys are doing,'" Burton said. "And they reassigned them to go do something else."
Andy Neill, chief enterprise architect and senior director for data and analytics at Info-Tech Research Group, said enterprise architects tend to be layoff targets during tough economic times because they generally command high salaries, and companies can save a significant amount of money if they cut the architecture team.
Neill said a large U.K.-based cruise company eliminated half of its 20 business architects and an underdetermined number of additional architects this year to focus strictly on business-critical items such as getting passengers onto ships and making them as safe as possible.
Two Canadian government departments told Neill they reassigned their entire enterprise architecture teams to build applications and service remote employees when the COVID-19 pandemic hit. But Neill said he knows the Canadian federal agencies plan to return the staffers to day-to-day enterprise architecture work, because they've already booked calls with him for October.
Neill said companies that eliminate their enterprise architecture teams often wind up restoring them within a couple of years. He said the price they've paid in the form of disjointed IT systems can put a heavy strain on application portfolios. Companies wind up with differing standards and patterns and have to start from scratch with each new project, rather than using reusable artifacts and building blocks, Neill cautioned. He said they also run the risk of misalignment with business opportunity without an enterprise architecture team in place.
Focus on business outcomes
Daniel Hebda, chief strategy officer at Mega International, a prominent enterprise architecture tools vendor, said the industry has had to battle historically negative perceptions that enterprise architects are an "ivory tower" group that focuses more on design than helping the company achieve business outcomes.
Hebda said Mega's customer advisory board of "visionary" users found that those taking an outcomes-based approach to architecture are receiving positive feedback during the pandemic. He cited an example of an architecture team that helped a company identify opportunities to optimize or save money on applications it was making available to remote workers.
No instances of downsizing have surfaced among the members of Mega's customer council, which includes 50 of the company's 2,000 customers, Hebda said. He claimed that Mega has not lost customers nor had any attempt to cancel contracts since the pandemic struck.
Mega rival Software AG, which also sells comprehensive enterprise architecture tools, likewise claimed it has received no reports of customer staff reductions during the past few months, but rather, has seen many users increase their use of the company's Alfabet product.
Ulrich Kalex, a senior vice president of product line management and R&D at Software AG, pointed to a large bank that used Alfabet to help ramp up support for digital interactions. He said a utility company used the tool to assist in determining which investments to put on hold, and a healthcare provider identified systems needing extended service-level agreements and vulnerability protection to deal with an increase in home users.
Others estimate layoffs at 20%
While Software AG and Mega say they've seen no architecture job losses, other EA tools vendors such as Enterprise Architecture Solutions, LeanIX and ValueBlue estimated pandemic-related layoffs or reassignments in the range of 20% among their customers. Affected job titles might include enterprise, business, solution, infrastructure, application and information architects.
Sarah Smith, head of business architecture at Enterprise Architecture Solutions, said the layoffs tend to vary by industry. She said they've taken a toll on theatre, cinema and retail, but the financial sector and local governments are putting additional emphasis on enterprise architecture to deal with work-from-home shifts or to become the focal point for the local COVID-19 response.
LeanIX estimated that, although 20% of its customers have laid off or shifted enterprise architects to other jobs, half are also accelerating their use of enterprise architecture tools during the pandemic. CEO and co-founder André Christ said customers are using LeanIX tools to help figure out their business continuity needs, assess their application portfolios and ensure that service management runs smoothly for remote workers.
In July, LeanIX reported an $80 million investment, led by Goldman Sachs Growth. Christ predicts his business will grow 80% in 2020, and said he hopes to expand from 240 to 300 employees by year's end.
"I see companies restarting their programs right now, and even some in affected industries like automotive or travel have extended their contracts with us," Christ said. "What we are seeing in the pandemic is enterprise architects are very much needed."