What is Capability-Based Planning?
Capability-Based Planning (CBP) is a business-driven approach that focuses on what the business needs to do rather than how it currently does things. It provides a stable foundation for planning because business capabilities change slowly compared to organizational structures, processes, or technologies.
Business Capability Defined
A Business Capability describes WHAT a business does, not HOW it does it.
Characteristics:
- Stable over time (unlike processes or org structures)
- Technology-agnostic (not tied to systems)
- Outcome-oriented (focused on results)
- Hierarchical (can be decomposed)
Example: Capability "Customer Order Fulfillment"
- What it does: Processes and delivers customer orders
- Outcome: Orders delivered to customers
- NOT: The Oracle ERP system
- NOT: The warehouse team
- NOT: The pick-pack-ship process
Capability vs. Function vs. Process
| Concept | Definition | Example | Stability | |---------|------------|---------|-----------| | Capability | What the business does | Order Fulfillment | Very stable | | Function | Organizational unit doing work | Logistics Department | Moderately stable | | Process | How work gets done | Pick-Pack-Ship Process | Changes frequently | | System | Technology supporting work | Warehouse Mgmt System | Changes frequently |
Building a Capability Map
Level 1: Business Areas
Customer Management | Product Management | Operations | Corporate Services
Level 2: Capability Groups
Customer Management: Customer Acquisition, Customer Service, Customer Retention, Customer Analytics
Level 3: Detailed Capabilities
Customer Acquisition: Lead Generation, Lead Qualification, Opportunity Management, Proposal Management, Contract Negotiation, Customer Onboarding
The Heat Map Approach
Capability heat maps visualize strategic priorities:
| Capability | Strategic Import. | Current Maturity | Gap Priority | |------------|-------------------|------------------|--------------| | Lead Generation | High | Low | 🔴 High | | Lead Qualification | Medium-High | Medium | 🟡 Med | | Opportunity Mgmt | High | Medium-High | 🟢 Low | | Customer Onboard | High | Low | 🔴 High |
Capability Assessment Dimensions
Maturity Levels
| Level | Description | Characteristics | |-------|-------------|-----------------| | 1 - Initial | Ad-hoc, reactive | No standard process | | 2 - Repeatable | Basic, documented | Consistent execution | | 3 - Defined | Standardized | Measured and managed | | 4 - Managed | Quantitatively managed | Data-driven optimization | | 5 - Optimized | Continuous improvement | Industry-leading |
Assessment Criteria
| Dimension | Questions | |-----------|-----------| | People | Do we have the right skills? Sufficient capacity? | | Process | Is the process defined? Efficient? Effective? | | Technology | Do systems support the capability? Integrated? | | Information | Do we have the data? Is it quality? Accessible? | | Governance | Are roles clear? Decisions made timely? |
Capability-Based Roadmapping
Step 1: Assess Current State
Capability: Customer Onboarding
- People: 2/5 (understaffed, skill gaps)
- Process: 3/5 (defined but manual)
- Technology: 2/5 (fragmented systems)
- Information: 2/5 (poor data quality)
- Overall Maturity: 2.25/5
Step 2: Define Target State
Capability: Customer Onboarding (Target)
- People: 4/5 (cross-trained team)
- Process: 4/5 (automated workflow)
- Technology: 4/5 (integrated CRM)
- Information: 4/5 (single customer view)
- Overall Maturity: 4/5
Step 3: Identify Initiatives
- People Gap (2→4): Onboarding team training program
- Process Gap (3→4): Process automation project
- Technology Gap (2→4): CRM implementation
- Information Gap (2→4): Customer data quality program
Step 4: Prioritize and Sequence
- Year 1 Q1-Q2: Customer data quality program (foundation)
- Year 1 Q3-Q4: CRM implementation (technology)
- Year 2 Q1-Q2: Process automation project (process)
- Year 2 Q3-Q4: Onboarding team training (people)
Strategic Benefits of CBP
1. Business-IT Alignment
- Architecture initiatives tied to business capabilities
- Technology investments justified by capability improvement
- Common language between business and IT
2. Investment Prioritization
- Focus on capabilities with highest strategic value
- Avoid investing in mature, low-priority capabilities
- Identify capability gaps blocking strategy
3. M&A Integration
Capability Overlap Analysis helps identify what to keep, merge, or retire from each company during mergers and acquisitions.
4. Cloud Migration Planning
Capability-Based Migration Approach:
- Wave 1: Low complexity, high value capabilities → Customer Analytics (SaaS)
- Wave 2: Medium complexity capabilities → HR Management (SaaS)
- Wave 3: Core business capabilities → Order Fulfillment (PaaS)
- Wave 4: Complex, regulated capabilities → Financial Management (IaaS/hybrid)
TOGAF Integration
Phase B Integration
CBP is a key technique in Business Architecture:
- Develop capability map as baseline
- Identify target capability states
- Perform capability gap analysis
Roadmapping Connection
CBP feeds into Phase E & F:
- Capability gaps → Architecture initiatives
- Capability priorities → Roadmap sequencing
- Capability dependencies → Project sequencing
Exam Tips
Key Concepts:
- Capability = What, not How - Stable, technology-agnostic
- Heat maps show strategic priority and gaps
- CBP bridges business strategy and architecture
- Used primarily in Phase B (Business Architecture)
Common Questions:
- "What is a business capability?" → What the business does, outcome-focused
- "Why use capabilities instead of processes?" → More stable, strategy-aligned
- "How does CBP relate to ADM?" → Primary input to Phase B, guides roadmap in E&F
- "What dimensions assess capability maturity?" → People, Process, Technology, Information
Key Takeaway
Capability-Based Planning provides a stable, business-focused foundation for architecture work. Because capabilities change slowly while processes and technologies change frequently, they provide a durable planning framework. The key insight is planning around WHAT the business needs to do, then determining HOW to enable those capabilities through process and technology improvements.