Editor’s note:
Capabilities are fundamental to Business Architecture, making it essential to understand how to implement them effectively. To help you navigate Capability-Based Planning, we’ve created the ultimate eBook, packed with insights, strategies, and practical guidance to set you on the right path. This blog post focuses on Business Capability Maps, and is an excerpt from the eBook, providing a glimpse into the valuable content you’ll find inside.
Business Capability Maps are used for a variety of strategic change purposes to align business leaders and other stakeholders on investment decisions. Business Capabilities are not IT concepts but are used to describe the abilities of an enterprise, i.e. what activities it can do, either now or in the future, rather than how a business performs these activities. To successfully design business capabilities and business capability maps, it’s important to consider design principles for business stakeholders to accept and adopt Capability Maps as a strategic planning tool that conveys meaningful information.
In this blog, we’ll provide practical business capability design principles focusing on the stakeholder and the maps’ general structure and visual appeal (please refer to the image below). We’ll focus on capability definition and decomposition in part 2 of this blog series.
The stakeholder
Business Capability Maps enable C-level and senior management to look at the enterprise through the lens of capabilities to see what it does instead of seeing how it is done in the organizational structure, business processes, or from another perspective. Leadership uses capabilities to advance their strategy and guide investment plans. This has implications for the design of the Capability Map. What do you need to consider?
In practice, IT often drives Business Capability maps and this can have an effect on how capabilities are described, e.g. having technical wording. It’s essential to keep in mind that the Capability Map is used by business leaders. Therefore, the design description needs to match wording these leaders can understand in a technology-neutral manner. Suppose the Capability Map is not regarded as an accurate and meaningful description of the enterprise’s business activities (as perceived by senior business leadership), it will not gain traction as a collaboration tool for planning and business design.
Another important aspect to remember in terms of stakeholders is the positioning of other planning and design frameworks. Think of a Business Process Map or Application and Technology Portfolio categorizations. Will the Capability Map replace all those maps and frameworks? Certainly not, because these frameworks provide stakeholder-specific viewpoints. The Business Process Map looks at the enterprise through the lens of operational processes, and the application framework is a way to look at the IT landscape through the lens of Application Portfolios.
However, different maps and frameworks can be related. For instance, we have seen in practice that it’s useful to analyze which applications are related to which business capabilities, as well as which application portfolio category they belong to. This helps to connect different stakeholders, especially in the early stages of introducing the Business Capability Map to an organization.
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A complete Business Capability Map typically includes many capabilities which need to be structured in a meaningful way. There are different approaches to categorizing business capabilities. For inspirational purposes, we’d like to give a few common approaches:
In practice, we often see the first approach used to differentiate capabilities into strategic, operational, or supporting – for instance in the manufacturing sector, where the main focus is often on the operational capabilities relating to the production and delivery of the products.
Note that the classification of a Capability can vary depending on the industry or strategy of a company. For example, an HR capability in manufacturing is often classified as supporting capability, while in (consulting) services, it may have a more prominent role – depending on the company’s strategy. A customer-facing classification makes sense when looking at client-facing capabilities. The classification in innovative, differentiating, and commodity capabilities is inspired by the Gartner pace layering concept.
An ArchiSurance Capability Map that combines the following categories: Strategic vs. Operational vs. Support; and Innovative vs. Differentiating vs. Commodity as a heat map.
C-level and business leaders are typically very busy and they need to form an opinion quickly. Keep in mind that you only have 50 milliseconds to make a good first impression! It’s therefore advisable to give your Capability Model the necessary visual appeal to show its value clearly.
A first impression depends on different factors. Take into account the age, gender, and education of your audience to determine how colorful and complex your Capability Map will be. Someone with a technical background consumes information differently than someone with a background in finance or law (also common among senior business leaders). Design an engaging Capability Map with a clear structure, graphical structuring elements, corporate colors, and icons. Ensure that you align all the boxes to make a good impression. Although these suggestions may sound simple, it’s not applied by everyone, often because of tool limitations to model a Capability Map. For an example of a Capability Map that includes visually appealing corporate colors and graphical elements, refer to the ArchiSurance Capability Map above.
Chief Strategy Officer at Bizzdesign
Nick is responsible for value proposition development, building strategic partnerships, and driving innovation topics, including executing Bizzdesign’s ‘buy & build’ acquisition strategy. He has over 25 years of experience in B2B enterprise software and SaaS, dedicating 15 years to enterprise architecture and portfolio management.
Managing Consultant at Bizzdesign
Bernd has held various roles during career, including consultant, trainer, and global solutions manager. His expertise includes Business Architecture, Enterprise Architecture, Portfolio Management, and Business Intelligence, where he has guided customers in maximizing value from Bizzdesign Horizzon predominantly in finance and manufacturing sectors in DACH and EMEA region.
