Our ongoing blog series on capability based planning has covered a lot of ground. We started by explaining the basic concepts and the value of capabilities, addressed the design of capability maps, how to relate capabilities with your strategy and operating model, explored capability assessment and roadmapping, discussed their use in investment decision-making and directing strategic change, investigated capability governance, and talked about overcoming obstacles and challenges, such as organizational resistance.
All of these topics are building blocks of an overall capability-based planning approach. In this blog installment, we address how you can establish and grow the use of Capability-based Planning in your organization.
Some approaches advocate creating a full Capability Map of your entire organization as a starting point. While we see the benefits of that, for instance, to avoid overlapping capabilities, we think that an iterative approach is more practical for most larger organizations, simply because of the scale of the effort. Moreover, such an approach will ease your stakeholders into this approach without forcing them to change their established ways of working overnight and avoid the pitfall of ‘analysis paralysis’.
Our approach consists of the following steps (though you may want to pick and choose which are most relevant to your organization and the resource capacity available):
Double-loop learning in implementing capability-based planning
Implementing this reusable approach is itself an iterative process. From a specific, confined scope, you can extend and grow in several directions:
Expand the scope
For example, rolling this out across different business units. Growing your capability map also requires rethinking some parts since the additional scope may overlap in capabilities with the parts you already addressed. Make sure your capability map does not become a substitute for the organization structure since that would negate many of the advantages of capability thinking. Remember, a capability is not equivalent to a team, department, or another organizational unit.
Expand the stakeholders involved
This could be from IT into the business, and it could be from senior business managers to business executives. Once senior leaders experience how this new way of thinking helps them focus investment decisions on the capabilities that are key to their strategy, they may even become advocates for this approach and convince their peers of its value. But the somewhat abstract nature of the capability concept will require a lot of communication: you will likely need to keep explaining this, and as they say, show, don’t tell: seeing it in action works best. On the other hand, you can emphasize how capabilities are a shorthand for people, process, technology and data, making complex topics easier to understand.
It should move from being a one-off exercise to being central to the business planning cycle. Business capabilities are generally static over time, so if they are used repeatedly, they become more recognizable and readily understood by stakeholders. It justifies the investment in defining them. Ideally, capability-based planning will move to the most appropriate team, e.g., the Strategy Planning team or equivalent in your organization.
Establish capability ownership
An average organizational chart does not always lend itself to easily identifying capability owners since capabilities often cross organization functions. However, executives could become responsible for capabilities despite all the resources involved not being in their chain of command. Ideally, with ownership comes responsibility for planning, resourcing and delivery of the capability.
Extend and refine the capability analyses and assessments
Use more metrics, obtain better/more precise data, involve more subject-matter experts, and integrate systems to pull the ‘official’ data to automate these assessments. By improving the data used, decisions on investment in change become more based on facts and figures rather than hunches and intuition. That helps you move away from ‘decibel-driven’ decision-making, where the people with the loudest voices get their projects approved.
Formalize investment prioritization
Formalize investment prioritization along the lines of capabilities rather than classical projects, typically in concert with other management changes. For example, this approach works well with moving from project to product-focused teams in IT. The key change here is that the strategy is linked to a capability outcome rather than a project scope which can contract easily.
Learn from this process of maturation
Learn from this process of maturation using feedback from the organization to refine your way of working. Capabilities are a new way of thinking, and while they offer numerous benefits that support what organizations are trying to do, you need to listen to the challenges and successes with this approach.
Of course, you need to keep your stakeholders informed and committed all the time, manage resistance when it occurs, and evaluate the return on investment of your CBP effort. Don’t overdo it! Not everyone needs to become a CBP champion (but being at least a runner-up is an excellent position to aim for).
This blog series is focused on the rational aspects of Capability-based Planning and not on change management in general. However, the political and emotional aspects of change are equally important to make Capability-based Planning a success in your organization. This includes:
We also addressed some of these aspects in our blog post on overcoming obstacles and challenges. Especially when it comes to organizational politics, architects are often ill at ease and out of their depth. Teaming up with someone more versed in this dimension of change (e.g., an experienced program manager or senior business leader) could be a good way to establish and mature a Capability-based Planning approach.
Most importantly, this should not be a ‘push’ effort from architects. Rather, you should aim to create a ‘pull’ from senior stakeholders by showing the added value of such an approach for their daily work and responsibilities. Once you succeed in piquing their interest, you may be surprised by the traction you will gain with such an architectural approach to business change.
This concludes our blog series on Capability-based Planning. Look out for our forthcoming e-book on the subject!