Monday, May 3, 2021

Integrating Core Business Capabilities

The digital organization is a dynamic system which needs to continue evolving and adapting, bringing greater awareness of intricacies and the systemic value of organizational systems.

With fierce competition and demanding customers, designing and building business capabilities becomes a constant process irrespective of the economic conditions. The high performance digital organizations need to do this under all circumstances. 

A core competency is a harmonization of multiple capabilities such that it permeates the entire organization with a focus, and in alignment with the resource-based view; and it is at the same time also valuable, rare, and difficult to imitate. The building blocks of dynamic core organizational competency include:

Design with observability and controllability:
Oftentimes, the enterprise capability design and configuration is uniquely challenging because of resource limitations or other business constraints. Top executives need to take a strategic perspective, make deep observations and identify the capability patterns of the company, and make the risk profile of the enterprise performance deficiencies. Technically, there are essential disciplines to observing: First is to use multiple capability-development models that have different assumptions and are about different aspects of reality, the second is to look deliberately and for evidence that contradicts the model, and the third is to consciously manage the models you use, to continuously evaluate, update, and redraft the models you are using for core capability design and development.

Define a set of business activities to design business capabilities and at the same time, keep the necessary flexibility in place, control of desired outcomes, but not overly control the process of “how.” The goal of tuning the core organizational capability development is to make the level of balance in a fine-tuning dynamic capability portfolio, to interact, influence and improve the expanded ecosystem seamlessly.

Build with coordination & integration: People are a critical success factor to integrate all important business elements such as people, process, technology, and talent into the cohesive and core business capability, allowing a group of people to function as a cohesive team to achieve more, incorporating informational balancing into business transformation. Communication is a coordination mechanism to inspire, motivate, persuade, negotiate, and clarify, to implement capability-based strategy and make progressive change possible. The key point is to make sure the “system-of-interest” is defined to establish the flexible business boundary and the properties that interact with the environment dynamically, consolidate, modernize, integrate, innovate, and optimize business processes, products, services into dynamic business capabilities all the time.

In many organizations with lower-level of maturity, the business is the sum of pieces, such as silo functions, incoherent processes, overly rigid hierarchy, fractal structure, or bureaucratic management style, not running as a premium whole. By integrating, you are creating a case where you force an organizational alignment to the integration to build business competency and maximize the value from existing systems and the need for better business performance and responsiveness. The successful integration will depend on the underlying business relationships between all of the crucial points and how they influence each other in building solid and differentiated business competency.

Upgrade with repurpose, realignment, and reconfiguration of well-designed components and systems: The underlying structures and processes are dynamic and flexible and the business capabilities can be reconfigured dynamically without reinventing the wheel. The dynamic capabilities can be built via sensing changes within the business ecosystem. Companies can disentangle dynamic capabilities in clusters of processes and managerial orchestration, continue deploying their business assets and resources, realign and configure a set of differentiated business competencies.

It’s important to map business capabilities and strategies, re-purpose well-designed components and systems for designing and configuring dynamic business capabilities, The best scenario is to create a comprehensive capability map to bridge capability gaps and clarify business objectives. Upgrade organizational capabilities with repurpose, realignment, and reconfiguration. The goal is to ensure that strategic goals can be accomplished quickly and consistently and reach the next business growth cycle effortlessly.

The digital organization is a dynamic system which needs to continue evolving and adapting, bringing greater awareness of intricacies and the systemic value of organizational systems, business capabilities, people dynamics, resource alignment, and technological touches. It is crucial to identify and close enterprise capability gaps, and proactively develop a set of differentiated capabilities to enable strategy execution, achieve business coherence and improve organizational maturity.


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