Tuesday, June 8, 2021

Understanding Capability Via Multiple Angles

If applying a capability view, the business management readily considers people, process, information, asset, culture, products/service/solutions etc, dimensions of the adequacy of the capability.

A business capability is an acquired and organized "ability" within a company and takes hard work to put in place; it can therefore not be transferred because of the degree of organizational learning and organization that goes with it. 

The aforementioned are generally considered to be “enablers” or “resources.” Here are three aspects of business capability.

Underpinned by processes: The processes and capabilities are the opposite sides of the same coin, processes are the actions that provide desired capabilities as outcomes. Capabilities are processes and competencies viewed strategically. In order to implement strategy effectively, you have to know the underlying structure and processes of your business. Process management is more as a business management philosophy and a holistic management practice. It requires senior management understanding and strategic involvement, the business management should understand every crucial workflow process to keep optimizing the business capacity, operational model, and overall organizational competency.

One capability may be implemented by multiple business processes for multiple products and services, enabled by a process-aware information systems and necessary technology components, etc. The processes are the tool to get the results you formulate in the strategy. The purposes of designed business systems are to provide processes that enable specific outputs and that will meet specific needs with the goals to either engage employees or delight customers. Any business practice today is always a combination of people, process, and technology to develop business capabilities. It starts with a mapping of processes to capabilities, do the process assessments, and infer from that with the resulting capability perspective.

Implemented or enhanced by Programs/Initiatives/projects delivery: Business initiatives are used to build organizational capabilities and deliver the strategy. It’s important to get a deep understanding of crucial business issues, build a healthy program portfolio for problem-solving and make continuous deliveries. The business executives have to leverage business architecture as an effective communication tool and apply systems thinking to make an objective assessment of their investment portfolio for getting high ROIs as business capability development is always an ongoing business continuum with an adaptation of changing environments.

Business executives need to continually evaluate individuals and aggregate investments in terms of value, risk, and reward, for building a cohesive business capability portfolio by asking: What is the relative health (risk, value, strategic importance) of each of the portfolios? What investments should you direct more assets to? What, and where, are there talent gaps to build the set of differentiated business capabilities? You can ot deliver value without "de-complexitizing" and making transparent what is being delivered and how or what is being delivered. Business leaders need to have just enough visibility about the project execution layer and how the projects and programs are performing in order to monitor progress and make the right decisions to ensure that the strategy potential is achieved.

Decomposed by functions: In the company, every “part” of the business needs to work together to be successful. To capture a vista point of capability view, gather as much input from all the business functions and departments including adherence to industry standards. The cohesive capabilities can be decomposed by function, glued by information technology and enforced by continuous improvement. Every function in the company has a different view or role on "change,” and plays an important role in showing support of overall organizational growth or shrinkage, and sourcing alternatives, driving change and making problem solving continuum.

To create business synergy, all functions and departments need to collaborate via in-depth communication and understanding. Collaboration, transparency, respect, and clear leadership are the keys to breaking down the barriers, energizing business mood. It's important to establish a cross-functional change team to involve the multifunctional management, space and time are made to scope, plan, and execute in a structural way.

By applying a capability view, the business management readily considers people, process, information, asset, culture, products/service/solutions etc, dimensions of the adequacy of the capability to build their strength and fulfill their business strategy. This is accomplished by developing the high-level requirements with main purposes or business system requirements to improve business effectiveness.


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