In the digital age the role of technology shifts from supporting processes of the business strategy to the key factory of strategy execution itself. Information Technology helps that customers receive their shirt ordered online the next day, it helps that they can read their newspaper during their commute on an iPad and that the invoices for these services are processed without friction.
As a result, the challenge how to bridge the gap between strategy and execution in IT becomes much more pressing. This gap is often caused by organizations speaking many languages. They speak of missions, strategies, goals, processes and projects. The CEO speaks of “making mobile first a priority”, Marketing of “increasing the share of wallet with millennials” and IT of “load balancing the Linux server cluster”. Which one is the right language? Business capabilities have the potential to serve as this common language. If properly used they can help save money, decrease risk and enable growth.
McKinsey found in a study that redundant IT support of the same capability in organizations bears saving potentials of 15 - 20%. But not only redundancy does cost real money. KPMG puts a bill of €590,000 on every single IT incident. Capabilities-driven thinking helps executives to understand and mitigate technology risks better.
Business capabilities form a crucial part of great IT strategies: They specify how we are going to win and how IT is helping along the way.
Learn in a free LeanIX white paper about why business capabilities make your life easier, how you can create your business capability model in four easy steps and how to create value based on your model - demonstrated with three case studies.