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Business Analysis Technique - Business Capability Analysis

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Ann P

 

  • Business capability analysis is usually done for an enterprise to assess what is it able to do which can result in business advantages or achieving its business objectives.
  • This is done to assess performance, set goals and identify gaps. This helps in prioritizing investment.

 

  • Capabilities may be assessed for performance and associated risks to identify specific performance gaps and prioritize investments

 

  • Capabilities describe the purpose or outcome of the performance or transformation

 

  • Does not describe how the performance or transformation is performed or the process part of it.

 

  • Only unique capabilities are presented in the organizational capability map

 

  • Similar capabilities existing across multiple LOBs do not find multiple places in the capability map

 

  • Capability analysis should impact value by revenue enhancement or cost reduction or improving service or customer satisfaction or achieving compliance or positioning of the company

 

  • Capabilities are assessed for current and expected performance. Gap performance of capability is used as input for strategic planning

 

  • This analysis may be done across the organization or within LOBs or units such as sales and marketing, customer service, production, post delivery support etc.

 

  • Capabilities do not have any inherent risks however the performance of capabilities or lack of it may cause risk.

 

  • Capability Maps – Denotes strengths and Weaknesses

 

  • A 2*2 grid or map of capability with criticality as depicted in the image below can quickly unveil the areas/capabilities that need to be taken up on priority.

 

Business Capability Analysis

 

  • Capability improvement initiatives should be taken up at an org level and not unit level

 

  • Capability map analysis require a collaborative model and suggest to develop common capabilities together

 

  • Does not work well if leaders/stake holders do not agree on a collaborative model or to work together.

 

  • Enterprises/businesses that spend more time on assessing the capability and work towards strengthening their critical capability always perform better in the long run.

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