In recent years, the idea of business capability modeling has emerged in the EA community. Much has been written about the idea of capability modeling, and it can even be said that we are facing a ‘capability hype’. You can find capability models for many industries on the internet. There are many industry-specific consortiums that try to model the business functions of that particular industry in the form of capabilities.
Capability modeling seems simple but is hard to do in practice. If you browse literature or the internet you’ll find only very little advice. No ‘Capability Modeling Guide’ out there. To change that, the Architectural Thinking Framework includes a draft of detailed guidelines that show how to model capabilities step-by-step.
Today we start a series of three blog posts that provide a capability modeling crash course. It includes the experience of ten years of trial and error in several companies and review by many practitioners.
A business capability is a core of ‘what’ a business does, a technique for the representation of an organisation’s business anchor model, independent of the organisation’s structure, processes, people or domains [GartnerGlossary]
Capabilities, which exist across business units and partner domains and rely on certain information, enable stakeholder value delivery. Value delivery requires that a business has certain capabilities. Value and capabilities together are the essence of business architecture. When correctly defined, capabilities form its robust centre-piece [BIZBOK].
The BIZBOK® Guide defines a number of principles for capabilities. These principles and guidelines can be summarised in a few simple points, including the following:
- Capabilities define what, not how, a business does something, meaning that capabilities provide a robust, long-standing business perspective;
- Capabilities represent unique, non-redundant views of the business that are defined once for the business;
- Capabilities are not defined haphazardly or on demand by a given program or business unit, but they do represent a foundational, ubiquitous business perspective across programs and business units.
Why Capability Modeling is mandatory for your Digital Transformation
- Capabilities clarify terms and concepts across organizational borders. Capabilities provide a robust skeleton, a framework for assigning all the other elements of enterprise architecture. They are ‘elegant in its simplicity yet powerful in its ability to serve as a focal point for transformations — large and small’ [BIZBOK].
- Capabilities help to make the business strategy executable. They align technology with the business by providing structure for all assets created from business strategy to IT implementation.
- Capabilities can be used as the central structure for heat mapping to answer questions such as: ‘Which strategic fields of actions do we see in which capability’; ‘In which capabilities are we planning to invest how much?‘; ‘Which capabilities are supported too little by IT?’
- EAs apply business capability modeling to better plan IT solutions that meet the needs of their business customers.
- Cross mapping capabilities with value streams help a business to envision which capabilities are required to enable customer value across a variety of scenarios. Value streams are cross mapped to capabilities, to show how a company orchestrates capabilities in order to create customer value.
- Strategic Fields of Action used in strategic planning can be assigned to business capabilities. Thus, capabilities are valuable in order to align projects with the vision/strategy of the company
To be continued…
Next week we will learn how to use industry-specific capability reference models and how to derive capabilities from your existing process models.