The Challenge

There has been a lot of buzz lately about where business processes fit when it comes to the capability of organizations to perform as they would like. Some say that business processes are needed to support already defined capabilities at a detailed level and some say that capabilities of various types are needed to enable to business processes to execute. Others would even say that your business processes and your capabilities are the same. Do these varying points of view represent real differences in practice or are they just ways of looking at the same thing? My view is that business processes are at the heart of determining capabilities.

My background has always been one of always aiming for business performance enhancement so I am always looking for ways to assure traceability of strategic business performance objectives into the work we have to actually do every day leveraging the tools we use. Without top to bottom and bottom to top linkage I feel we will always struggle in justifying investment in changed capability on the basis of value creation. Instead we will justify change based on the building of misaligned and suboptimal assets solely because someone wants them for their own benefit or amusement and not for the good of the enterprise overall. Perhaps they just do not know any better. My experience is that Business Processes are the ideal organizers of change because only a business process can deliver a business result that is measurable in business terms and directly traceable to strategic objectives. In this way senior staff can assume accountability for both business performance and the capabilities needed to deliver it. In that sense a good business process provides a strong organizational capability and a bad business process an inadequate capability. This implies that the highest levels of capabilities should naturally be the same as the highest level of processes as one would find in the organization’s business process architecture. These process-centric business capabilities are required to support the desired outcomes (value created) of the work we need to do for the recipient stakeholders of that work. Capability that is not structured around business processes but around functional or organization chart activity is a recipe for unaligned thinking and no traceable accountability for performance. This is no better than traditional inadequate ways of defining needs. The dictionary tells us that ‘capability’, is just ‘an ability’ to perform a defined activity. So, if business processes form natural organizational capabilities in their own right, what do they need to articulate and manage their own required ability? In this sense we need to know what process enabling ‘ability’ is needed.

The challenge with the term ‘capability’ as used by Information Technology technicians and Enterprise Architects especially is that it is used in a uni-dimensional and simplistic way. As commonly used, the term is missing a defining context. The nature of the term is that it is structured to always modify another concept. It works best as an adjective and not a noun in that it does not stand alone. Just saying ‘capability’ is not sufficient since the word always needs a frame of reference. Is it the capability of a person, an organization, a piece of software, a facility or piece of equipment that we are talking about? The term ‘capable’ as defined by Merriam-Webster’s dictionary means ‘having attributes (as physical or mental power) required for performance or accomplishment’. Therefore, for practical usage, it is essential to know the purpose of your organization, your business processes and each of the attributes your enabling assets need to have in order to know whether it is capable or not. A hammer in the right hands is very capable of enabling you to put a nail into a piece of wood if that is your purpose but not so capable in any hands if sawing that piece of wood in half if that’s what’s needed. ‘Capability’ then needs both a business context as well as a set of criteria (purpose) for assessment. The word should never be used without criteria and frame of reference. This is what business processes will bring. It is why they have to be the organizing element of the set of capabilities needed. They are not a deep decomposition of a capability. They are an organizing concept of the first order.

A big challenge faced by organizations everywhere is to assure that all reusable resources are traceable in their support for the organization’s purpose; its strategic intent. The problem is exacerbated, of course if there is not a clear and shared direction defined in terms of strategic Vision, Goals and Objectives. These terms, as defined in the Business Motivation Model from Object Management Group, must be clear or there is nothing to relate to and the aforementioned capability criteria will be in conflict. But if we assume, optimistically, that we have a defined enterprise North Star then we must then figure out both what we need to do to be on the right path as well as how good we need to be at what we do to accomplish our aim.

The role of Business Processes in value creation and performance management is essential in assuring traceability and in governance over business performance and business change. There are many advocates of the capability concept who claim that Business Processes are just lower levels of Capability. My experience is precisely the opposite. They are the basis for determining what the capability requirements are. If we see Capability as ‘ability to’ then one has to ask ‘ability to what?’ ‘Do something (process) of business value (purpose)’ is implied so what is it you need to do? The answer is to conduct your business processes in the best possible way consistent with meeting your intent. The way to decompose your organization into manageable pieces that stay traceable is through a business process one and not an organization chart one and not a functional one as often seen in so many capability lists. I would even confidently make the statement that a stakeholder focussed, outside-in business process decomposition is the ONLY approach that retains a direct connection to business strategic intent, value creation and performance delivery because no one outside cares about your organization chart or your functions, only about the results of business processes. Business processes and capabilities to enable them must remain agnostic to organization charts not derived from the functions inside their boundaries. So my experience is that nothing can be aligned without a very good traceable business process architecture from which the needs for capabilities can be derived since it is the appropriately enabled business processes that deliver value and nothing else in and of itself. A solid business process architecture starting with value chains is essential to connect to strategic intent in a way that list of things as we see in many capability maps cannot.

So what I am actually saying is that the first order of developing a good business architecture is the establishment of a holistic Business Process Architecture decomposed to a sufficient level of detail cover ALL the work performed by the enterprise to meet our enterprise purpose. This architecture must be derived from the outside looking in based on stakeholders’ outcome expectations and services otherwise it is not a Business Process Architecture connected to value creation and business performance delivery and certainly not to realization of the strategic intent of the organization. No other types of maps of the work we do will suffice including functional forms of capability lists.

For every business process in the architecture we need to establish if there is a performance gap between what we are delivering today and what we hope to achieve in the future based on our strategic intent. In our experience, the larger the gap in business process performance the larger the capability gap and the greater need for capability change in the form of process, resources and assets redesign.

The Burlton Hexagon

At BPTrends we use the process centric Burlton Hexagon to represent the alignment of capabilities that may have to be considered for change.

Process Ring

The hexagon assumes that we have a clear definition of the process boundaries and scope sourced from a well formed process architecture that has followed the principles of the Business Process Manifesto^{[fusion_builder_container hundred_percent=”yes” overflow=”visible”][fusion_builder_row][fusion_builder_column type=”1_1″ background_position=”left top” background_color=”” border_size=”” border_color=”” border_style=”solid” spacing=”yes” background_image=”” background_repeat=”no-repeat” padding=”” margin_top=”0px” margin_bottom=”0px” class=”” id=”” animation_type=”” animation_speed=”0.3″ animation_direction=”left” hide_on_mobile=”no” center_content=”no” min_height=”none”][1]}. The process ring identifies the work actions from opening event to closing event as well as the items coming in and out of the process and the dependencies among the component activities. This is the glue to which everything else will stick.

Performance Bulls Eye

The center of the hexagon is the definition of the measurable process performance indicators as well as measurement data for current and future target states. This provides the motivation for any ongoing process execution as well as improvement initiatives. Everything must be driven by this.

Information and Knowledge Ring

This ring identifies the input, output, reference information and know-how to be transformed, used or created by the business process. I also includes the big data gathered in the conduct of the processes to be used for generating insights. The quality of this data will be a reflection of the quality of the process. These are the artifacts of the business.

Intent and Strategy Slice

This slice defines the strategic intent which will act as the alignment criteria by which the business process is designed, measured and assessed. It provides the basis for establishing traceability of the business process and its parent and children activities as well as the performance evaluation criteria for each. This direct strategic link is unique to business processes and assures capability is linked to purpose.

Policies and Rules Slice

This slice examines the constraints and the guiding impact from legislation, legal opinion, business policies, decision criteria, specifically articulated rules, governance requirements, compliance needs and any other knowledge that guides or directs the work performed. Inappropriate policies and rules can cripple process execution and the attainment of business goals and objectives.

Organization Structure Slice

This slice aligns the structural aspects of the organization in its reporting framework, governance, roles, jobs and responsibilities. This also includes the formal alignment of performance and incentives to ideal process and business outcomes and the assignment of results to organizational leaders.

Human Capital Slice

This slice covers the enabling human ability to perform as needed in terms of competencies, skills, knowledge, education and training needs. It defines capacities, experience levels and any other human enabling requirements for the business and its processes. Individual motivation alignment and the cultural aspects of human resource and group behavior is also covered here. All of these are critical capabilities in their own right.

Enabling Technology Slice

This slice defines how technologies of various types make the processes and in turn the enterprise capable to realize its strategic intent including software applications, process automation engines, SOA services, databases, client devices, network infrastructure and communications technologies. All of these can have a significant impact on the ability of the processes and enterprise to perform as needed.

Supporting Infrastructure Slice

This slice deals with the needs to be supported by physical enabling capabilities such as work locations, physical plant, production and distribution facilities as well as equipment and fleet required. These provide some critical capabilities for the enterprise and its processes. The work environment including working conditions and health and safety needs is also part of the set of capabilities needed here.

Closing Thoughts

I have a post-it note in my office that says ‘Distrust any one thing that claims to deal with everything’. When it comes to ‘capabilities’ being the solution to all our architectural woes I must honor the warning. When I see lists of vague, unaligned and non-traceable capabilities that are uni-dimensional based on professional function I get concerned that, once again, as professionals we are being seduced into wanting an easy way out. The Burlton Hexagon with its business process organization of multiple dimensions of capability is the most useful tool that I have found to sort out the set of capabilities needed for real business planning and implementation of change. The challenge is very complex with lots of things that have to be well defined and which have to work well with one another. I hope you will find this perspective useful as I have done.

That’s how I see it

 

1. The Business Process Manifesto can be downloaded in multiple languages at www.bptrends.com ↑

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