What we are able to do by orchestrating people and assets.
Enterprises strive to achieve their purpose by creating products that feature in people's experiences. To do so, they must design and realise their capabilities by orchestrating meaningful combinations of people and assets. Each capability produces well-defined outputs for internal or external business use and contributes directly or indirectly to product creation.
Capabilities guide the modularisation of our enterprise by defining boundaries around what "belongs together" and what is distinct from other capabilities. By deriving the realising processes and assets (such as the required organisation and applications), a well-designed capability model leads to enterprises and organisations that are adaptive to change. Capabilities can be decomposed into sub-capabilities (usually levels 1-3) to create a hierarchy. Each capability must have a clearly assigned business owner to ensure its strategic development and the effective creation of intended outputs.
Depicting a tree relationship. Also known as Business Capability Map
- A national government develops the capability to warn citizens about potential environmental dangers.
- A railway service operates its own power plants and power lines to distribute energy across their network.
- A technology company sets up a government relations capability to affect upcoming regulation.
- A design studio excels in its digital product design practice, building upon research and prototyping capabilities.
- Clarify what needs to be done and the assets your people need to do that.
- To achieve intended outcomes, focus your resources on the right outputs to contribute to.
- Define clear ownership for governance structures based on capability boundaries.
- Design your operations for efficiency and business adaptivity.
- Create a common terminology.
- product requires capability
- organisation has capability
- capability requires asset
- process realises capability
- in-house, outsourced (tag)
- innovating, differentiating, commodity (tag)
- cost (metric)
- performance (metric)