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IN THIS SECTION, YOU WILL: Learn that an IT architecture can align technology decisions with value-based business strategy by simplifying IT initiatives, enhancing customer experience, improving employee work conditions, optimizing supplier relationships, and enabling business model shifts to maximize overall value creation.

KEY POINTS:

  • Value-Based Strategy prioritizes initiatives that create value for customers (raising WTP), employees (improving work conditions), and suppliers (reducing costs).
  • Reducing Complexity: Eliminating redundant systems and focusing on fewer, high-impact IT initiatives increases efficiency and strategic alignment.
  • Enhancing Customer Experience: Seamless digital interactions, personalization, and high availability improve customer satisfaction and increase their willingness to pay (WTP).
  • Improving Employee Productivity: Automation, better tools, and flexible work arrangements enhance job satisfaction and reduce friction.
  • Optimizing Supplier Relationships: IT-driven supply chain efficiencies reduce suppliers’ costs and improve business partnerships.
  • Leveraging IT for Ecosystems & Complementary Value: API-driven platforms and integrated digital services enhance core business offerings.
  • Supporting Business Model Shifts: Adaptable IT architectures enable companies to pivot to new revenue streams (e.g., SaaS, cloud computing, AI-driven services).


As IT architects, we often focus on designing scalable, secure, and efficient systems. However, true architectural success comes from aligning IT strategy with business value creation. Felix Oberholzer-Gee’s article “Eliminate Strategic Overload” introduces a value-based strategy, which simplifies strategic decision-making by focusing on initiatives that create substantial value for customers, employees, and suppliers. This concept directly relates to IT architecture, underscoring how technology decisions should support overarching business goals.


Key Elements of Value-Based Strategy

At its core, value-based strategy focuses on three key elements:

  1. Creating value for customers by raising their willingness to pay (WTP).
  2. Creating value for employees by making work more appealing.
  3. Creating value for suppliers by reducing their operating costs.

Figure 1: Value-based strategy focuses on three key elements.


Creating value for customers by raising willingness to pay (WTP)

Businesses succeed by enhancing customer experience and product appeal, making customers willing to pay more. IT architecture supports this by enabling seamless digital experiences, improving personalization, and ensuring high availability.

Creating value for employees by making work more appealing

Organizations that improve employee work environments—through automation, better tools, and flexible work arrangements—reduce friction and increase job satisfaction. IT architecture plays a crucial role in providing these improvements.

Creating value for suppliers by reducing their operating costs

Companies that improve supplier efficiency through optimized logistics, data insights, and digital tools create value for both parties. IT architectures that support real-time supply chain analytics and automation contribute to these efficiencies.


Creating Technology Ecosystem For Business Success

By embedding these principles into IT architecture, enterprises can create a technology ecosystem directly contributing to business success.

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IT leaders should move beyond technical efficiency and align architectures with strategic value creation by:

  1. Simplifying technology stacks to focus on fewer impactful systems.
  2. Enhancing customer experiences through well-architected digital platforms.
  3. Improving employee work conditions with automation and seamless IT experiences.
  4. Optimizing supplier interactions through smart supply chain solutions.
  5. Building ecosystems and complements with flexible, API-driven architectures.
  6. Enabling business model shifts by designing adaptable IT infrastructures.

By adopting value-based strategy principles, IT architects ensure that technology is not just an operational enabler but a core driver of business value.

Reducing Complexity: Focusing on Fewer, High-Impact IT Initiatives

Modern enterprises face strategic overload, where multiple competing initiatives dilute the impact. IT architecture often mirrors this complexity, with organizations maintaining redundant systems, fragmented data strategies, and competing technology stacks. Value-based strategy teaches that organizations should prioritize fewer high-impact initiatives that maximize value. Enterprise architects should streamline technology portfolios, eliminating redundant systems and focusing on platforms that create tangible business value. For instance, instead of maintaining multiple CRMs across different business units, a unified CRM that enhances customer experience and integrates with other business functions increases willingness to pay (WTP).

Creating Value for Customers Through IT

The article emphasizes that companies succeed by increasing customers’ willingness to pay (WTP) by enhancing product appeal and experience. The IT architecture enables frictionless digital interactions, improves personalization, and ensures high system availability. Cloud-native architectures, AI-driven recommendations, and seamless omnichannel experiences contribute to higher WTP. For instance, Netflix’s personalized recommendation engine increases customer retention by continuously improving engagement and perceived value.

Enhancing Employee Experience Through IT

Value-based strategy also emphasizes improving employee work conditions to lower their willingness to sell (WTS)—in other words, making jobs more appealing. IT architecture can support this by providing better tools, automating repetitive tasks, and enabling flexible work arrangements. Enterprise systems should prioritize user-friendly interfaces, automation, and collaboration tools to enhance productivity and job satisfaction. For instance, adopting DevOps pipelines and infrastructure-as-code reduces friction in software deployment, making engineers more productive and engaged.

Optimizing Supplier Relationships with Technology

Companies create value by reducing suppliers’ operating costs, which lowers their willingness to sell (WTS) and leads to better pricing and partnerships. IT architecture can support this through efficient procurement systems, automated supply chain management, and data-driven decision-making. Supply chain optimization can increase transparency, reduce costs, and improve supplier relationships. Nike’s lean manufacturing training for suppliers, supported by data analytics, helped reduce costs and improve margins for Nike and its partners.

Leveraging IT to Create Complementary Value

Value-based organizations seek complements—services or products that enhance the core offering rather than increasing sales. IT architecture should facilitate the integration of these complements. APIs and platform-based ecosystems enable businesses to offer complementary services seamlessly. For instance, Apple’s ecosystem (iPhones, iPads, App Store, iCloud) thrives on integration, ensuring that complementary services increase customer stickiness.

Shifting Profit Pools with IT-Enabled Business Models

As industries evolve, companies must shift their profit pools—moving value capture from core products to adjacent services. IT architectures need to be adaptable to support these strategic shifts. Cloud computing, SaaS models, and AI-driven insights allow businesses to pivot revenue models and enter new markets. For instance, Microsoft’s shift from selling Windows licenses to a cloud-based subscription model (Azure, Office 365) reflects a profit pool shift that IT architecture enabled.


To Probe Further


Questions to Consider

  • How does your organization’s IT architecture currently contribute to customer value creation? Are there areas for improvement?
  • In what ways does your company use IT to enhance employee experience and productivity?
  • How can IT reduce complexity in your organization by eliminating redundant systems and focusing on fewer, high-impact initiatives?
  • What role does IT play in improving supplier relationships and supply chain efficiencies?
  • How well is your IT strategy aligned with business goals rather than just technical efficiency?
  • What complementary digital services could your company offer to enhance core business value?
  • Does your IT architecture support business model shifts, such as transitioning to subscription-based or platform-driven models?
  • How does your organization ensure that IT investments prioritize strategic value rather than short-term technical fixes?
  • What role do AI, cloud computing, and automation play in increasing efficiency and competitive advantage within your company?
  • How can enterprise architects better collaborate with business leaders to align IT initiatives with overall value creation?
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