A Capability is WHAT You Can Achieve

A capability indicates what your organization can accomplish; it doesn't specify how or why. This distinction, while subtle, is crucial. It can be challenging to differentiate between a capability (WHAT) and the methods or reasons behind it (HOW and WHY).

For instance, if a business needs to hold virtual meetings with customers, we might identify a capability named "Conduct Virtual Meetings." This title focuses on what the organization can do without delving into the methods employed.

Conversely, labeling it as "Have a Zoom meeting with a Customer to Get Their Order" blurs the lines, as it suggests a specific method (HOW) and purpose (WHY), rather than maintaining the broader focus on what can be done.

What Enables a Capability?

To establish a specific business capability, several key elements must be in place:

1. Processes: Capabilities necessitate action, defined through a series of steps known as processes.
2. People: Typically, a team executes these processes, bringing necessary skills and knowledge to the table.
3. Technology: The processes are often supported by tools, applications, or IT systems that facilitate their execution.

Most capabilities you identify will involve these three components. While automation may replace certain roles, human involvement is typically integral to creating or supporting that automation.

A Visual Representation of Capability

As an Enterprise Architect, I favor ArchiMate for illustrating strategic concepts. Often, I employ the open-source tool Archi to create diagrams that elucidate my discussions.

Eero Hosiaisluoma has compiled an impressive collection of ArchiMate examples, including a "Capability Planning View," which effectively illustrates the relationships between capabilities and other enterprise architecture elements.

This diagram illustrates how the capability "Digital Customer Management" is realized through several processes, such as "Customer Service," which is managed by the "Customer Service Team" and supported by the "CRM Application."

Leveraging Your Capability Map in Strategy

Creating a capability map for your organization is a valuable first step in understanding your capabilities. Once established, you can utilize this map to address strategic inquiries. For instance, when a new strategic goal arises, assess which capabilities may need adjustment, addition, or removal.

If a capability requires modification, consider the necessary changes. Will processes need optimization, or will new skills be required for personnel? What technological updates are essential to achieve your strategic objectives?

Two Additional Considerations

To fully grasp the implications of your capabilities, two more factors are essential: financial resources and spatial requirements.

1. Financial Resources: Every capability incurs costs. Modifying a capability will involve initial expenses, and ongoing maintenance costs may vary based on the changes implemented. Understanding these financial implications can significantly influence prioritization in strategic decision-making.
2. Space Requirements: Often overlooked, the physical space needed for capabilities can be critical. While some capabilities may not demand additional space, others may require it, especially when scaling operations or adding new personnel. Consider the implications of location and cost when evaluating space needs.

Closing Thoughts

Strategic thinking demands a high-level perspective. Capabilities provide a framework to assess "what your business can do" without getting bogged down in minute details. This broader view helps maintain focus on strategic objectives.

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