Map Your Business Architecture to Define Your Strategy

Plan your organization’s capabilities for best impact and value.

Info-Tech Research Group

Info-Tech is a provider of best-practice IT research advisory services that make every IT leader’s job easier.

Analyst perspective

Know your organization’s capabilities to build a digital and customer-driven culture.

Business architecture provides a holistic and unified view of:

• All the organization’s activities that provide value to their clients (value streams).
• The resources that make them possible and effective (capabilities, i.e. its employees, software, processes, information).
• How they inter-relate, i.e. depend on and impact each other to help deliver value.

Without a business architecture it is difficult to see the connections between the business’s activities for the customer and the IT resources supporting them – to demonstrate that what we do in IT is customer-driven.

As a map of your business, the business architecture is an essential input to the digital strategy:

• Develop a plan to transform the business by investing in the most important capabilities.
• Ensure project initiatives are aligned with business goals as they evolve.
• Respond more quickly to customer requirements and to disruptions in the industry by streamlining operations and information sharing across the enterprise.

Crystal Singh
Research Director, Data and Analytics
Info-Tech Research Group

Andrea Malick
Research Director, Data and Analytics
Info-Tech Research Group

Executive summary

Info-Tech Insight
Business architecture is the set of strategic planning techniques that connects organization strategy to execution in a manner that is accurate and traceable and promotes the efficient use of organizational resources.

Blueprint activities summary

Info-Tech’s workshop methodology

Key concepts for this blueprint

Info-Tech’s approach

Business architecture is a planning function that connects strategy to execution

Business architecture provides a framework that connects business strategy and IT strategy to project execution through a set of models that provide clarity and actionable insights. How well do you know your business?

Business architecture is:

• Inter-disciplinary: Business architecture is a core planning activity that supports all important decisions in the organization, for example, organizational resources planning. It’s not just about IT.
• Foundational: The best way to answer the question, “Where do we start?” or “Where is our investment best directed?”, comes from knowing your organization, what its core functions and capabilities are (i.e. what’s important to us as an organization), and where there is work to do.
• Connecting: Digital transformation and modernization cannot work with siloes. Connecting siloes means first knowing the organization and its functions and recognizing where the siloes are not communicating.

Business architecture must be branded as a front-end planning function to be appropriately embedded in the organization’s planning process.

Brand business architecture as an early planning pre-requisite on the basis of maintaining clarity of communication and spreading an accurate awareness of how strategic decisions are being made.

As an organization moves from strategy toward execution, it is often unclear as to exactly how decisions pertaining to execution are being made, why priority is given to certain areas, and how the planning function operates.

The business architect’s primary role is to model this process and document it.

In doing so, the business architect creates a unified view as to how strategy connects to execution so it is clearly understood by all levels of the organization.

Business architecture is part of the enterprise architecture framework

Business architecture is a set of shared and practical views of the enterprise

The key characteristic of the business architecture is that it represents real-world aspects of a business, along with how they interact.

Many different views of an organization are typically developed. Each view is a diagram that illustrates a way of understanding the enterprise by highlighting specific information about it:

• Business strategy view captures the tactical and strategic goals that drive an organization forward.
• Business capabilities view describes the primary business functions of an enterprise and the pieces of the organization that perform those functions.
• Value stream view defines the end-to-end set of activities that deliver value to external and internal stakeholders.
• Business knowledge view establishes the shared semantics (e.g. customer, order, and supplier) within an organization and relationships between those semantics (e.g. customer name, order date, supplier name) – an information map.
• Organizational view captures the relationships among roles, capabilities, and business units, the decomposition of those business units into subunits, and the internal or external management of those units.

Business architect connects all the pieces

The business owns the strategy and operating model; the business architect connects all the pieces together.

Choose a key business challenge to address with business architecture

Picking the right project is critical to setting the tone for business architecture work in the organization.

Best practices for business architecture success

Consider these best practices to maintain a high level of engagement from key stakeholders throughout the process of establishing or applying business architecture.

Balance short-term cost savings with long-term benefits

Participate in project governance to facilitate compliance

Create a center of excellence to foster dialogue

Value streams: Understand how you deliver value today

It is important to understand the different value-generating activities that deliver an outcome for and from your customers.

We do this by looking at value streams, which refer to the specific set of activities an industry player undertakes to create and capture value for and from the end consumer (and so the question to ask is, how do you make money as an organization?).

Our approach helps you to strengthen and transform those value streams that generate the most value for your organization.

An organization can have more than one set of streams.
For example, an enterprise can provide both retail shopping and financial services, such as credit cards.

Define the organization’s value streams

• Value streams connect business goals to the organization’s value realization activities. They enable an organization to create and capture value in the market place by engaging in a set of interconnected activities. Those activities are dependent on the specific industry segment an organization operates within. Value streams can extend beyond the organization into the supporting ecosystem, whereas business processes are contained within and the organization has complete control over them.
• There are two types of value streams: core value streams and support value streams. Core value streams are mostly externally facing: they deliver value to either an external or internal customer and they tie to the customer perspective of the strategy map. Support value streams are internally facing and provide the foundational support for an organization to operate.
• An effective method for ensuring all value streams have been considered is to understand that there can be different end-value receivers. Info-Tech recommends identifying and organizing the value streams with customers and partners as end-value receivers.

Example: Value stream descriptions for the retail industry

Value streams describe your core business

Value streams – the activities we do to provide value to customers – require business capabilities.

Value streams are broken down further into value stages, for example, the Sell Product value stream has value stages Evaluate Options, Place Order, and Make Payment.

Think of value streams as the core operations: the reason for your organization’s being. A professional consulting organization may have a legal team but it does not brand itself as a law firm. A core value stream is providing research products and services; a business capability that supports it is legal counsel.

Decompose the value stream into stages

The stages of a value stream are usually action-oriented statements or verbs that make up the individual steps involved throughout the scope of the value stream, e.g. Place Order or Make Payment.

Each value stream should have a trigger or starting point and an end result for a client or receiver.

There should be measurable value or benefits at each stage. These are key performance indicators (KPIs). Spot problem areas in the stream.

Value streams usually fall into one of these categories:

1. Fulfillment of products and services
2. Manufacturing
3. Software products
4. Supporting value streams (procurement of supplies, product planning)

Value streams need capabilities

• Value streams connect business goals to the organization’s value realization activities. They enable an organization to create and capture value in the market place by engaging in a set of interconnected activities.
• There are two types of value streams: core value streams and support value streams. Core value streams are mostly externally facing: they deliver value to either an external or internal customer and they tie to the customer perspective of the strategy map. Support value streams are internally facing and provide the foundational support for an organization to operate.
• There can be different end-value receivers. Info-Tech recommends identifying and organizing the value streams with customers and partners as end-value receivers.

Value streams need business capabilities

Business capabilities are built up to allow the business to perform the activities that bring value to customers. Map capabilities to the value-add activities in the value stream. Business capabilities lie at the top layer of the business architecture:

• They are the most stable reference for planning organizations.
• They make strategy more tangible.
• If properly defined, they can help overcome organizational silos.

Example business capability map – Higher Education

A business capability map can be thought of as a visual representation of your organization’s business capabilities and represents a view of what your data program must support.

Validate your business capability map with the right stakeholders, including your executive team, business unit leaders, and/or other key stakeholders.

Example business capability map for: Higher Education

Example business capability map – Local Government

Validate your business capability map with the right stakeholders, including your executive team, business unit leaders, and/or other key stakeholders.

A business capability map can be thought of as a visual representation of your organization’s business capabilities and represents a view of what your data program must support.

Example business capability map for: Local Government

Value streams need business capabilities

Value streams – the activities we do to provide value to customers – require business capabilities. Value streams are broken down further into value stages.

Business capabilities are built up to allow the business to perform the activities that bring value to customers. Map capabilities to the activities in the value stage to spot opportunities and problems in delivering services and value.

Business processes fulfill capabilities. They are a step-by-step description of who is performing what to achieve a goal. Capabilities consist of networks of processes and the resources – people, technology, materials – to execute them.

Capability = Processes + Software, Infrastructure + People

Prioritize a value stream and identify its supporting capabilities

Prioritize your improvement objectives and business goals and identify a value stream to transform.

Align the business objectives of your organization to your value streams (the critical actions that take place within your organization to add value to a customer).

Prioritize a value stream to transform based on the number of priorities aligned to a value stream, and/or the business value (e.g. revenue, EBITDA earnings, competitive differentiation, or cost efficiency).

Decompose the selected value stream into value stages.

Align capabilities level 1 and 2 to value stages. One capability may support several value stages in the stream.

Build a business architecture for the prioritized value stream with a map of business capabilities up to level 2.

NOTE: We can’t map all capabilities all at once: business architecture is an ongoing practice; select key mapping initiatives each year based on business goals.

Map business capabilities to Level 2

Map capabilities to value stage

Business value realization

Business value defines the success criteria of an organization as manifested through organizational goals and outcomes, and it is interpreted from four perspectives:

• Profit generation: The revenue generated from a business capability with a product that is enabled with modern technologies.
• Cost reduction: The cost reduction when performing business capabilities with a product that is enabled with modern technologies.
• Service enablement: The productivity and efficiency gains of internal business operations from products and capabilities enhanced with modern technologies.
• Customer and market reach: The improved reach and insights of the business in existing or new markets.

Value, goals, and outcomes cannot be achieved without business capabilities

Break down your business goals into strategic and achievable initiatives focused on specific value streams and business capabilities.

Accelerate the process with an industry business architecture

It’s never a good idea to start with a blank page.

The business capability map available from Info-Tech and with industry standard models can be used as an accelerator. Assemble the relevant stakeholders – business unit leads and product/service owners – and modify the business capability map to suit your organization’s context.

Acceleration path: Customize generic capability maps with the assistance of our industry analysts.

Identify goals and drivers

Consider organizational goals and industry forces when planning.

Use inputs from business goals and strategies to understand priorities.

It is not necessary to have a comprehensive business strategy document to start – with key stakeholders, the business architect should be able to gather a one-page business value canvas or customer journey.

Determine how the organization creates value

Begin the process by identifying and locating the business mission and vision statements.

What is business context?

“The business context encompasses an understanding of the factors impacting the business from various perspectives, including how decisions are made and what the business is ultimately trying to achieve. The business context is used by IT to identify key implications for the execution of its strategic initiatives.”

Source: Businesswire, 2018

Identify the key stakeholders who can help you promote the value of business architecture

First, as the CIO, you must engage executive stakeholders and secure their support.
Focus on key players who have high power and high interest in business architecture.

Engage the stakeholders who are impacted the most and have the power to impede the success of business architecture.

For example, if the CFO – who has the power to block funding – is disengaged, business architecture will be put at risk.

Use Info-Tech’s Stakeholder Power Map Template to help prioritize time spent with stakeholders.

Identify the key stakeholders concerned with the business architecture project

A business architecture project may involve the following stakeholders:

You must identify who the stakeholders are for your business architecture work.

Think about:

• Who are the decision makers and key influencers?
• Who will impact the business architecture work? Who will the work impact?
• Who has vested interest in the success or failure of the practice?
• Who has the skills and competencies necessary to help us be successful?

Avoid these common mistakes:

• Don’t focus on the organizational structure and hierarchy. Often stakeholder groups don’t fit the traditional structure.
• Don’t ignore subject-matter experts on either the business or IT side. You will need to consider both.

1.1 Identify and assemble key stakeholders

1-3 hours

Build an accurate depiction of the business.

1. It is important to make sure the right stakeholders participate in this exercise. The exercise of identifying capabilities for an organization is very introspective and requires deep analysis.
2. Consider:
1. Who are the decision makers and key influencers?
2. Who will impact the business capability work? Who has a vested interest in the success or failure of the outcome?
3. Who has the skills and competencies necessary to help you be successful?
3. Avoid:
1. Don’t focus on the organizational structure and hierarchy. Often stakeholder groups don’t fit the traditional structure.
2. Don’t ignore subject matter experts on either the business or IT side. You will need to consider both.

Conduct interviews with the business to gather intelligence for strategy

Talking to key stakeholders will allow you to get a holistic view of the business strategy.

Build a strategy on a page through executive interviews and document reviews

Understanding the business mandate and priorities ensures alignment across the enterprise.

A business strategy must articulate the long-term destination the business is moving into. This illustration shapes all the strategies and activities in every other part of the business, including what IT capabilities and resources are required to support business goals. Ultimately, the benefits of a well-defined business strategy increase as the organization scales and as business units or functions are better equipped to align the strategic planning process in a manner that reflects the complexity of the organization.

Using the Business Strategy on a Page canvas, consider the questions in each bucket to elicit the overall strategic context of the organization and uncover the right information to build your digital strategy. Interview key executives including your CEO, CIO, CMO, COO, CFO, and CRO, and review documents from your board or overall organizational strategy to uncover insights.

Info-Tech Insight
A well-articulated and clear business strategy helps different functional and business units work together and ensures that individual decisions support the overall direction of the business.

Focus on business value and establish a common goal

Business architecture is a strategic planning function and the focus must be on delivering business value.

Examples business objectives:

• Digitally transform the business, redefining its customer interactions.
• Identify the root cause for escalating customer complaints and eroding satisfaction.
• Identify reuse opportunities to increase operational efficiency.
• Identify capabilities to efficiently leverage suppliers to handle demand fluctuations.

Info-Tech Insight
CIOs are ideally positioned to be the sponsors of business architecture given that their current top priorities are digital transformation, innovation catalyzation, and business alignment.

1.2 Collect and understand business objectives

1-3 hours

Having a clear understanding of the business is crucial to executing on the strategic IT initiatives.

1. Discover the strategic CIO initiatives your organization will pursue:
• Schedule interviews.
• Use the CIO Business Vision diagnostic or Business Context Discovery Tool.
2. Document the business goals.
3. Update and finalize business goals.

CIO Business Vision Diagnostic

CEO

Interview the following executives for each business goal area.

Craft a strategy to increase stakeholder support and participation

The BA practice’s supporters are potential champions who will help you market the value of BA; engage with them first to create positive momentum. Map out the concerns of each group of stakeholders so you can develop marketing tactics and communications vehicles to address them.

Example Communication Strategy

1.3 Craft a strategy to increase stakeholder support and participation

1-2 hours

Now that you have organized and categorized your stakeholders based on their power, influence, interest, and knowledge of business architecture, it is time to brainstorm how you are going to gain their support and participation.

Think about the following:

• What are your stakeholders’ concerns?
• How can you address them?
• How will you deliver the message?
• How often will you deliver the message?

Avoid these common mistakes:

• Your communication strategy development should be an iterative process. Do not assume to know the absolute best way to get through to every resistor right away. Instead, engage with your supporters for their input on how to communicate to resistors and repeat the process for indifferent stakeholders as well.

Download the Stakeholder Engagement Strategy Template for this project.

Engaging the right stakeholders

CASE STUDY

Source
Anonymous

1.4 Develop a plan to engage key stakeholders

1 hour

Using your stakeholder power map as a starting point, focus on the three most important quadrants: those that contain stakeholders you must keep informed, those to keep satisfied, and the key players.

Plot the stakeholders from those quadrants on a stakeholder engagement map.

Think about the following:

• Who are your resistors? These individuals will actively detract from project’s success if you don’t address their concerns.
• Who is indifferent? These individuals need to be educated more on the benefits of business architecture to have an opinion either way.
• Who are your supporters? These individuals will support you and spread your message if you equip them to do so.

Avoid these common mistakes:

• Do not jump to addressing resistor concerns first. Instead, equip your supporters with the info they need to help your cause and gain positive momentum before approaching resistors.

Download the Stakeholder Engagement Strategy Template for this project.

1.5 Craft a strategy to increase stakeholder support and participation

1-2 hours

Now that you have organized and categorized your stakeholders based on their power, influence, interest, and knowledge of business architecture, it is time to brainstorm how you are going to gain their support and participation.

Think about the following:

• What are your stakeholders’ concerns?
• How can you address them?
• How will you deliver the message?
• How often will you deliver the message?

Avoid these common mistakes:

• Your communication strategy development should be an iterative process. Do not assume to know the absolute best way to get through to every resistor right away. Instead, engage with your supporters for their input on how to communicate to resistors and repeat the process for indifferent stakeholders as well.

Download the Stakeholder Engagement Strategy Template for this project.

Define value streams

Identify the core activities your organization does to provide value to your customers.

This phase will walk you through the following activities:

• Note: It is recommended that you gather and leverage relevant industry standard business architecture models you may have available to you. Example: Info-Tech Industry Business Architecture, BIZBOK, APQC.
• Defining or updating the organization’s value streams.
• Selecting priority value streams for deeper analysis.

This phase involves the following participants:

• Business Architect, Enterprise Architect
• Relevant Business Stakeholder(s): Business Unit Leads, Departmental Executives, Senior Mangers, Business Analysts

Define the organization’s value streams

• Value streams connect business goals to the organization’s value realization activities. They enable an organization to create and capture value in the marketplace by engaging in a set of interconnected activities. Those activities are dependent on the specific industry segment an organization operates within. Value streams can extend beyond the organization into the supporting ecosystem, whereas business processes are contained within and the organization has complete control over them.
• There are two types of value streams: core value streams and support value streams. Core value streams are mostly externally facing: they deliver value to either an external or internal customer and they tie to the customer perspective of the strategy map. Support value streams are internally facing and provide the foundational support for an organization to operate.
• An effective method for ensuring all value streams have been considered is to understand that there can be different end-value receivers. Info-Tech recommends identifying and organizing the value streams with customers and partners as end-value receivers.

Connect business goals to value streams

Identifying value streams

Value streams connect business goals to organization’s value realization activities. They enable an organization to create and capture value in the market place by engaging in a set of interconnected activities.

There are several key questions to ask when endeavoring to identify value streams.

Example: Value stream descriptions for the retail industry

Value streams describe your core business

Value streams – the activities we do to provide value to customers – require business capabilities.

Value streams are broken down further into value stages, for example, Sell Product value stream has value stages Evaluate Options, Place Order, and Make Payment.

Think of value streams as the core operations, the reason for our organization’s being. A professional consulting organization may have a legal team but it does not brand itself as a law firm. A core value stream is providing research products and services – a business capability that supports it is legal counsel.

2.1 Define value streams

1-3 hours

Unify the organization’s perspective on how it creates value.

1. Write a short description of the value stream that includes a statement about the value provided and a clear start and end for the value stream. Validate the accuracy of the descriptions with your key stakeholders.
2. Consider:
1. How does the organization deliver those benefits?
2. How does the customer receive the benefits?
3. What is the scope of your value stream? What will trigger the stream to start and what will the final value be?
3. Avoid: Don’t start with a blank page. Use Info-Tech’s business architecture models for sample value streams.

See your Info-Tech Account Representative for access to the Reference Architecture Template

Decompose the value stream into stages

The stages of a value stream are usually action-oriented statements or verbs that make up the individual steps involved throughout the scope of the value stream, e.g. Place Order or Make Payment.

Each value stream should have a trigger or starting point and an end result for a client or receiver.

There should be measurable value or benefits at each stage.
These are key performance indicators (KPIs).
Spot problem areas in the stream.

Value streams usually fall into one of these categories:

1. Fulfillment of products and services
2. Manufacturing
3. Software products
4. Supporting value streams (procurement of supplies, product planning)

Value stream and value stages examples

Customer Acquisitions
Identify Prospects > Contact Prospects > Verify Interests

Sell Product
Identify Options > Evaluate Options > Negotiate Price and Delivery Date > Place Order > Get Invoice > Make Payment

Product Delivery
Confirm Order > Plan Load > Receive Warehouse > Fill Order > Ship Order > Deliver Order > Invoice Customer

Product Financing
Initiate Loan Application > Decide on Application > Submit Documents > Review & Satisfy T&C > Finalize Documents > Conduct Funding > Conduct Funding Audits

Product Release
Ideate > Design > Build > Release

Sell Product is a value stream, made up of value stages Identify options, Evaluate options, and so on.

2.2 Decompose selected value streams

1-3 hours

Once we have a good understanding of our value streams, we need to decide which ones to focus on for deeper analysis and modeling, e.g. extend the business architecture to more detailed level 2 capabilities.

Organization has goals and delivers products or services.

1. Identify which value propositions are most important, e.g. be more productive or manage money more simply.
2. Identify the value stream(s) that create the value proposition.
3. Break the selected value stream into value stages.
4. Analyze value stages for opportunities.

Build your value stream one layer at a time to ensure clarity and comprehensiveness

The first step of creating a value stream is defining it.

• In this step, you create the parameters around the value stream and document them in a list format.
• This allows you to know where each value stream starts and ends and the unique value it provides.

The second step is the value stream mapping.

• The majority of the mapping is done here where you break down your value stream into each of its component stages.
• Analysis of these stages allows for a deeper understanding of the value stream.
• The mapping layer connects the value stream to organizational capabilities.

Define the value streams that are tied to your strategic goals and document them in a list

Title

• Create a title for your value stream that indicates the value it achieves.
• Ensure your title is clear and will be understood the same way across the organization.
• The common naming convention for value streams is to use nouns, e.g. product purchase.

Scope

• Determine the scope of your value stream by defining the trigger to start the value stream and final value delivered to end the value stream.
• Be precise with your trigger to ensure you do not mistakenly include actions that would not trigger your value stream.
• A useful tip is creating a decision tree and outlining the path that results in your trigger.

Objectives

• Determine the objectives of the value stream by highlighting the outcome it delivers.
• Identify the desired outcomes of the value stream from the perspective of your organization.

Example Value Streams List

Create a value stream map

Decompose the value stream into its value stages

The first step in creating a value stream map is breaking it up into its component stages.

The stages of a value stream are usually action-oriented statements or verbs that make up the individual steps involved throughout the scope of the value stream.

The Benefit
Segmenting your value stream into individual stages will give you a better understanding of the steps involved in creating value.

Connect the stages of the value stream to a specific customer perspective

The Benefit
Adding the customer’s perspective will inform you of their priorities at each stage of the value stream.

Connect the stages of the value stream to a desired outcome

The Benefit
Understanding the organization’s desired outcome at each stage of the value stream will help set objectives and establish metrics.

Define the entry and exit criteria of each stage

The Benefit
Establishing the entry and exit criteria for each stage will help you understand how the customer experience flows from one end of the stream to the other.

Outline the key metric(s) for each stage

The Benefit
Setting metrics for each stage will facilitate the tracking of success and inform the business architecture practitioner of where investments should be made.

Example value stream map: Sell Product

Assess the stages of your value stream map to determine which capabilities to examine further

To determine which specific business capabilities you should seek to assess and potentially refine, you must review performance toward target metrics at each stage of the value stream.

Stages that are not performing to their targets should be examined further by assessing the capabilities that enable them.

Determine the business capabilities that support the value stage corresponding with the failing metric

Sell Product

Identify Options > Evaluate Options > Negotiate Price and Delivery Date > Place Order > Get Invoice > Make Payment

The value stage(s) that doesn’t meet its objective metrics should be examined further.

• This is done through business capability mapping and assessment.
• Starting at the highest level (level 0) view of a business, the business architecture practitioner must drill down into the lower level capabilities that support the specific value stage to diagnose/improve an issue.

Info-Tech Insight
In the absence of tangible metrics, you will have to make a qualitative judgement about which stage(s) of the value stream warrant further examination for problems and opportunities.

Build business capability map

Align supporting capabilities to priority activities.

This step will walk you through the following activities:

• Determine which business capabilities support value streams
• Accelerate the process with an industry reference architecture
• Validate the business capability map
• Establish level 2 capability

This step involves the following participants:

• Enterprise/Business Architect
• Business Analysts
• Business Unit Leads
• CIO
• Departmental Executives & Senior Managers

Outcomes of this step

Develop a business capability map – level 1

• Business architecture consists of a set of techniques to create multiple views of an organization; the primary view is known as a business capability map.
• A business capability defines what a business does to enable value creation and achieve outcomes, rather than how. Business capabilities are business terms defined using descriptive nouns such as “Marketing” or “Research and Development.” They represent stable business functions, are unique and independent of each other, and typically will have a defined business outcome. Business capabilities should not be defined as organizational units and are typically longer lasting than organizational structures.
• A business capability mapping process should begin at the highest-level view of an organization, the level 1, which presents the entire business on a page.
• An effective method of organizing business capabilities is to split them into logical groupings or categories. At the highest level, capabilities are either “core” (customer-facing functions) or “enabling” (supporting functions).
• As a best practice, Info-Tech recommends dividing business capabilities into the categories illustrated to the right.

The Business Capability Map is the primary visual representation of the organization’s key abilities or services that are delivered to stakeholders. This model forms the basis of strategic planning discussions.

Example business capability map – Higher Education

A business capability map can be thought of as a visual representation of your organization’s business capabilities and represents a view of what your data program must support.

Validate your business capability map with the right stakeholders, including your executive team, business unit leaders, and/or other key stakeholders.

Example business capability map for: Higher Education

Example business capability map – Local Government

A business capability map can be thought of as a visual representation of your organization’s business capabilities and represents a view of what your data program must support.

Validate your business capability map with the right stakeholders, including your executive team, business unit leaders, and/or other key stakeholders.

Example business capability map for: Local Government

Map capabilities to value stage

Source: Lambert, “Practical Guide to Agile Strategy Execution”

3.1 Build level 1 business capability map

1-3 hours

1. Analyze the value streams to identify and describe the organization’s capabilities that support them. This stage requires a good understanding of the business and will be a critical foundation for the business capability map. Use the reference business architecture’s business capability map for your industry for examples of level 1 and 2 business capabilities and the capability map template to work in.
2. Avoid:
1. Don’t repeat capabilities. Capabilities are typically mutually exclusive activities.
2. Don’t include temporary initiatives. Capabilities should be stable over time. The people, processes, and technologies that support capabilities will change continuously.

Ensure you engage with the right stakeholders:

Don’t waste your efforts building an inaccurate depiction of the business: The exercise of identifying capabilities for an organization is very introspective and requires deep analysis.

It is challenging to develop a common language that everyone will understand and be able to apply. Invest in the time to ensure the right stakeholders are brought into the fold and bring their business area expertise and understanding to the table.

Prioritize one value stream and build a business architecture to level 2 capabilities

Prioritize your innovation objectives and business goals, and identify a value stream to transform.

Align the innovation goals and business objectives of your organization to your value streams (the critical actions that take place within your organization to add value to a customer).
Prioritize a value stream to transform based on the number of priorities aligned to a value stream and/or the business value (e.g. revenue, EBITDA earnings, competitive differentiation, or cost efficiency).
Working alongside a business or enterprise architect, build a reference architecture for the prioritized value stream up to level 2.

Info-Tech Insight
To produce maximum impact, focus on value streams that provide two-thirds of your enterprise value (EBITDA earnings).

From level 1 to level 2 business capabilities

3.2 Build level 2 business capability map

1-3 hours

It is only at level 2 and further that we can pinpoint the business capabilities – the exact resources, whether applications or data or processes – that we need to focus on to realize improvements in the organization’s performance and customer experience.

1. Gather industry reference models and any existing business capability maps.
2. For the selected value stream, further break down its level 1 business capabilities into level 2 capabilities.
3. You can often represent the business capabilities on a single page, providing a holistic visual for decision makers.
4. Use meaningful names for business capabilities so that planners, stakeholders, and subject matter experts can easily search the map.

Download: See your Account Representative for access to Info-Tech’s Reference Architecture Template

3.3 Heatmap business capability map

1-3 hours

Determine the organization’s key capabilities.

1. Determine cost advantage creators. If your organization has a cost advantage over competitors, the capabilities that enable it should be identified and prioritized. Highlight these capabilities and prioritize the programs that support them.
2. Determine competitive advantage creators. If your organization does not have a cost advantage over competitors, determine if it can deliver differentiated end-customer experiences. Once you have identified the competitive advantages, understand which capabilities enable them. These capabilities are critical to the success of the organization and should be highly supported.
3. Define key future state capabilities. In addition to the current and competitive advantage creators, the organization may have the intention to enhance new capabilities. Discuss and select the capabilities that will help drive the attainment of future goals.
4. Assess how well information, applications, and processes support capabilities.

Download: See your Account Representative for access to Info-Tech’s Reference Architecture Template

Business capability map: Education

Define key capabilities

Note: Illustrative Example

Business process review

Note: Illustrative Example

Information assessment

Note: Illustrative Example

Application assessment

Note: Illustrative Example

MoSCoW analysis for business capabilities

Note: Illustrative Example

Ranked list of IT implications

3.4 Roadmap business architecture initiatives

1-3 hours

Unify the organization’s perspective on how it creates value.

1. Write a short description of the value stream that includes a statement about the value provided and a clear start and end for the value stream. Validate the accuracy of the descriptions with your key stakeholders.
2. Consider:
1. How does the organization deliver those benefits?
2. How does the customer receive the benefits?
3. What is the scope of your value stream? What will trigger the stream to start and what will the final value be?
3. Don’t start with a blank page. Use Info-Tech’s business architecture models for sample value streams.

Download: See your Account Representative for access to Info-Tech’s Reference Architecture Template

Example: Business architecture deliverables

Tools and templates to compile and communicate your business architecture work

The Industry Business Reference Architecture Template for your industry is a place for you to collect all of the activity outputs and outcomes you’ve completed for use in next-steps.

Download the Industry Business Reference Architecture Template for your industry

Info-Tech offers various levels of support to best suit your needs

Diagnostics and consistent frameworks are used throughout all four options

Research Contributors and Experts

Bibliography

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Burlton, Roger, Jim Ryne, and Daniel St. George. “Value Streams and Business Processes: The Business Architecture Perspective.” Business Architecture Guild, December 2019. Web.

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“Delivering on your strategic vision.” The Business Architecture Guild, n.d. Web.

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Lambert, Daniel. “Practical Guide to Agile Strategy Execution.” 18 February 2020.

Lankhorst, Marc, and Bernd Ihnen. “Mapping the BIZBOK Metamodel to the ArchiMate Language.” Bizzdesign, 2 September 2021. Web.

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Whittie, Ralph. “The Business Architecture, Value Streams and Value Chains.” BA Institute, n.d. Web.