Capability-driven business model innovation: adding new sources of growth

Welcome to the first “Change by Design” issue! We believe that transformation should not be a disruption. Success in the face of complexity should not be luck. It should be by design.?

In the “Change by Design” series, we will share the latest thinking and insights on Enterprise Architecture, Solution Architecture, Business Capabilities and more, from our experts and our community.?Make sure to subscribe!

Play a greater role in value creation

Over the last few weeks, we shared with you the key takeaways from our recent report - “7 Key Trends in Enterprise Architecture” for 2022. After the first four trends were published, we invited our followers to give feedback on which trend they found the most interesting or resonated the most with. The most popular trend picked by our followers was Trend #3 - Capability-driven business model innovation: adding new sources of growth.

We decided to publish an even more detailed breakdown of this trend, in case you didn’t have time to read the full report.

In this article, we’ll show you how to leverage competitive differentiator business capabilities for new sources of growth.

The pace of change in business is faster than ever before and will continue to increase, given the availability and accessibility of new technologies and cloud services. But while digital technologies offer the potential to radically change business and operating models, innovation is not just about technology.?

Business model innovation is all about identifying target customers with a problem that needs solving. Firstly, there is value in solving the problem (i.e., the customer is willing to pay for it). Secondly, you have the capabilities to solve the problem, either directly or in collaboration with partners, and thirdly, you can create a sustainable business by solving the problem.??

These three factors are typically characterized as desirability (you have a solution that your target customer wants to buy), feasibility (you can actually deliver your solution) and viability (you can deliver your solution at a profit – or at least in a way that creates value for you and your customer).??

Find the full report here.

Make sure you follow us on LinkedIn for even more interesting insights on Enterprise Architecture, Solution Architecture, Business Capabilities and more!

Many organizations seek new sources of growth – or, for more mission-driven organizations, looking for new ways of achieving their (non-profit-driven) goals – through the development of new value propositions.

Very often, this starts with strategy and involves the enterprise architecture team supporting analysis of existing business capabilities to identify where improvements are needed to achieve targeted goals. This analysis supports gap closure scenario modeling and planning of gap closure initiatives. More often than not, it involves analyzing how technology and data support this capability development. But, in its full strength, Enterprise Architecture can also drive strategy and innovation.??

An innovative Bizzdesign customer in financial services posed a challenge to their enterprise architecture team. They needed to support the development of new value propositions that leverage their key business capabilities where they have a competitive advantage.?Based on their capability analysis, they identified cybersecurity risk management as a high-mature capability; an area where there was also a significant need – and capability gap – in their existing customer base. And so, the Enterprise Architecture team supported the development of a new proposition for their customers to help them manage their cybersecurity, using the in-house expertise they already had.?

Steps you can take

Enterprise architects have often played a role in innovation. As architects, we help our organizations harness technology for business benefit, and particularly mapping new and emerging technologies to the business capabilities that they enable.?

But we also have an opportunity to play a greater role in value creation by looking beyond the boundaries of our organization. We can partner with executives to explore and exploit new opportunities enabled by existing business capabilities.?

As enterprise architects we should:?

• Partner with innovation teams to understand the innovation portfolio and assess existing business capabilities that may enable new value propositions?
• Partner with business teams to understand customer needs, pains, and gains. We need to help connect these with new value propositions enabled by key capabilities and provide business modeling support to define new business and operating models.?
• Provide scenario modeling, business impact assessment, and roadmapping services to support the scale-up and benefits realization of new business ideas.

Thanks for reading. We’ll return next month with more fresh insights. Until then, visit the full "7 Key Trends in Enterprise Architecture" report at Bizzdesign for more.

More valuable resources:

• Sign up for the must-attend Enterprise Architecture Summit - May 12, 2022 - with Shell, T-Mobile, HP, ServiceNow and more great speakers!
• Learn more about using Metro Maps to Visualize Dataflow for a Business Audience
• Listen to our podcast featuring the team from the Enterprise Architecture Center of Excellence at Danske Bank on driving collaboration across the enterprise

Make sure you follow us on LinkedIn for even more interesting insights on Enterprise Architecture, Solution Architecture, Business Capabilities and more!