Tuesday, August 11, 2020

Values of Enterprise Capability Mapping

With today’s digital paradigm shift, enterprise capabilities are building blocks to shift an organization from a reactive surviving mode to a proactive thriving mode.

The enterprise consists of a set of capabilities with the right mix of competitive necessity and competitive differentiator. Business capabilities are fundamental pillars to achieve the corporate strategy. 

Defining enterprise business capability is part art and part science, building business capabilities is more science than art. Enterprise capability mapping helps management both define and develop business capabilities systematically. Capability underpins the business strategy, the capability-based strategy management has a much higher success rate statistically. Here is a set of values of enterprise capability mapping, to improve the success rate of strategy management.

The value of capability mapping is to enable smooth capability-based strategy management: Enterprise capability management consists of a portfolio or matrix of capabilities that are used in various combinations to implement the strategy and achieve business outcomes. Creating an organizational strategy-capability mapping helps to set goals for capability deployment and competence building. A strategically competent organization has a deliberately close alignment among the company’s strategic direction and most distinctive capabilities, to create synergies in strategy execution.

The organization can achieve its strategic goals based on its core competency. It is not necessary to reinvent the wheel in designing and building business capabilities; having a clearly developed enterprise capability mapping helps to design, build, scale, and optimize the dynamic business capabilities via those existing building blocks or recombine those existing capabilities into the more sophisticated capabilities for enabling an iterative strategy execution continuum. 

The value of capability mapping is to make holistic investment decisions: It provides the basis for identifying capability gaps in the context of future needs as well as strategy management. It also compares your set of capabilities with competitors' to ensure that it is developing differentiated capabilities to gain unique competency. Effective capability mapping offers opportunities for senior management to determine whether they are supporting appropriate projects, building business competency, and making strategic planning and holistic investment decisions wisely.

The value of enterprise capability mapping helps the management decide whether to continue investing in specific capabilities in order to meet business objectives or maximize business potential. With the well-built capability map and strategy execution roadmap, business leaders today can seek input for future adjustments, make holistic investment decisions, orchestrate dynamic competencies via managerial activities, and ensure the company capabilities fully support the strategy implementation and improve its success rate.

The value of capability map is to provide an insight into the business condition and relationship/dependency: It should demonstrate all necessary capabilities to deliver products or services, as well as the necessary capabilities to support strategy implementation. It also provides an insight into the business condition and relationship/dependency. If you need to modify one of those capabilities to execute a dynamic strategy or develop new products/services/solutions to delight customers, then model/mapping assists with a high-level impact assessment and delivery approach. 

The hyper-connective nature of digitalization offers particularly fertile ground for developing dynamic and recombinant digital capabilities cross-industrial ecosystems. Organizations need to discover their “innate strength,” do enterprise capability mapping, understand relationship/dependency between different capabilities, and make an objective assessment of their business capability maturity. The capability maturity can be evaluated against the achievement of desired business outcomes by measuring the technology impact on capability effectiveness, the process impact on capability effectiveness, as well as the people factor about the collective capability effectiveness and maturity. 

With today’s digital paradigm shift, enterprise capabilities are building blocks to shift an organization from a reactive surviving mode to a proactive thriving mode. The values of enterprise capability mapping help the organization investigate different paths for accelerating business growth, build a cohesive set of business capabilities systematically to deliver on either customer needs, or to achieve the desired business performance continuously. 


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