Capability Maps

So far, this blog has used way too many words to suit an engineer. Where are all the diagrams?

In this post series I will describe and build a capability map. I will also provide a quick look forward into how capability maps can be used. Let's get started!

There are many ways to view your enterprise. These lenses include product lines, organization, lines of business, and geography to name a few. Capability Maps provide the lens of what your business does. A business capability identifies something an organization is able to do independent of how or why.

Capability Maps are interesting because the other lenses tend to change with some regularity. Companies enter or leave a market impacting products and possibly geography, and organizations realign due to M&A or divestment activities, and a host of other reasons. If we want to leverage and align enterprise assets (people, process and things) towards established strategies, a more stable enterprise model will help.

Capabilities Maps are a much more stable way to model your enterprise. What a company does to achieve success simply doesn't change that much. Banks lend money and provide financial services. Retail outlets buy, market and sell merchandise. Aerospace companies build airplanes. Boeing goes so far as to say, "We are not going to build railcars or boats. We are going to build aerospace products." That is a pretty definitive statement about what Boeing does and intends to do. Serving new markets or aligning their organization will have very little impact on what Boeing needs to do to remain successful.

This doesn't mean that capabilities will not change or evolve, but capabilities change as a result of changes to strategic intent. As examples:

• A company that makes collateralized consumer loans, e.g., cars or RV loans, will need to have a capability to dispose of repossessed property. If the company enters into consumer leases, it will need to modify and enhance that capability to accept and dispose of lease returns.
• With the advance of the digital enterprise and digital product delivery channels, almost every business is faced with building new digital and customer experience (CX) focused capabilities to deliver their products and manage customer service.
• In the case of Boeing and their 737 MAX, perhaps their capability to Ensure Product Safety or Manage Software Quality needs to be bolstered, or if you are of the mind that the product needs a total redesign, perhaps there is something in how they manage their vision or strategy that needs a tweak.

Getting Started

Performing a web search will provide you with many definitions and structures for a capability map. One source you may have overlooked is the APQC®. This organization has worked with industry consortia to establish the Process Classification Framework (PCF). The PCFs provide cross-industry and industry-specific taxonomies of business processes.

The APQC PCFs are a great resource for identifying your capabilities for a number of reasons:

• Using the PCFs provides confidence that your capability map won't omit something important.
• The processes are identified as operating processes or supporting processes.
• Operating processes map to capabilities that are critical to the daily operation of your business. You will modify the operating capabilities to support the specifics of your business. These capabilities can be distinctive competencies that set your organization apart from your competitors.
• Supporting processes map to capabilities that, while important, are not directly tied to product delivery. They are largely consistent from industry to industry.

The PCFs are very detailed, and in some places reach down five levels. For your initial capability map only two levels are needed. By convention, capability levels are zero-based, so we will focus on Level 0 and Level 1. The image below (er, above) is the APQC cross-industry PCF, Level 0.

Let's pause the blog right here and provide some time to look at the APQC PCFs. While you are there, checkout some other really good benchmark information available from APQC. 

Future posts will have more diagrams, so I'm going to need to figure-out how to insert them in-line. I hope not to have to purchase a LinkedIn premier/prime membership. :-/

Next Blog Topic: Capability Maps (cont'd)

Happy Engineering!