To hear the buzz around business capabilities one would expect some consensus about basic principles as well as an established track record. Since there is little to be found on either account, should the notion be seen as a modern philosophers’ stone ?
Clear evidence can be found by asking two questions: what should be looked for, and why it can’t be found.
What is looked for
Business capabilities can be understood as a modern avatar of the medieval philosophers’ stone, a alchemical substance capable of turning base metals into gold.
In the context of corporate governance, that would mean a combination of assets blueprints and managing principles paving the way to success.
But such a quest is to err between the sands of businesses specificities and the clouds of accounting generalities.
At ground level enterprises have to mark their territory and keep it safe from competitors. Whatever the means they use (niche segments, effective organization, monopolistic situations, …,) success comes from making a difference.
With hindsight, revealing singularities may be discovered among the idiosyncrasies of business successes, but that can only be done from accounting heights, where capabilities are clouded by numbers.
why it can’t be found
The fallacy of a notion can also be established a contrario if, assuming the existence of a philosophers’ stone, the same logic would also demonstrate the futility of the quest.
Such a reasoning appears more like a truism when applied to business capabilities: insofar as business competition is concerned success is exclusive and cutting edges are not shared. It ensues that assuming business capabilities could be found, they would by the same move become obsolete and be instantly dissolved.
What should be looked for
As far as business environments are concerned, success is by nature singular and transient, and it consequently depends on sustaining a balancing act between assets and opportunities; that’s what a business model is meant to achieve.
Taking a leaf from Alexander Osterwalder and Yves Pigneur handbook, nine aspects should be considered:
- Customer Segments: categories of people or organizations an enterprise aims to serve.
- Value proposition: bundles of products and services meant to create value to customer segments.
- Channels: how value propositions are to be delivered to customer segments.
- Customer Relationships: policies to be carried out according to value propositions and customer segments.
- Revenue Streams: cash generated by customer segment and value propositions.
- Key Resources.
- Key Activities.
- Key Partnerships.
- Cost Structure.
The five first objectives are to mapped to enterprise architecture capabilities, and feasibility assessed (points 6 to 9)
- Thread: Enterprise Architecture
- Models, Architectures, Perspectives (MAPs)
- Views, Models, & Architectures
- EA: The Matter of Layers
- Architecture Capabilities
- Feasibility & Capabilities
- Squared Outline: Business Capabilities
- Value Chains & EA
- Squaring Software To Value Chains
- Agile Architectures: Versatility meets Plasticity
- Service Oriented Architectures
- EA: Maps & Territories
- Relating to Functions
- Capabilities vs Processes
- From Processes to Services
- Alignment for Dummies
- Alignment: from Empathy to Abstraction