The world of business is truly fascinating. Business provide a livelihood to the majority of the human race. Even farmers also depend on businesses to sell their products and get inputs for farming.
However, to most of us, the world of business remains a mystery. In these series of blogs, we try to unravel the mysteries of business.
In this blog we will learn about the ‘Techniques for developing and managing business capabilities.’
| Technique name | Description |
| Value chain analysis | Value chain analysis is a way of describing the activities within and around an organization that is then used to identify potential sources of a company’s economic advantages, and thereby make an assessment of its competitive strengths. Value chain analysis, originated by Porter (1985), derives from value analysis, an accounting tool developed in the 1950s. Value analysis was designed to show the value-added components in a company’s manufacturing process. Porter took the concept a stage further by linking all an organization’s separate operations and then assigning a value to each activity. Each activity is analyzed in terms of its cost drivers and its relationship to other activities, then the company’s cost position is assessed in relation to those of its competitors. Porter explains, ’A firm gains competitive advantage by performing these strategically important activities more cheaply or better than its competitors. Adding differences among competitor value chains are a key source of competitive advantage. |
| Pareto principle | Pareto principle can be applied to a great number of problems. It is based on the observation of an Italian economist, Pareto that 80 per cent of the elements of a given set of circumstances are generally due to 20 per cent of the causes of those elements. The Pareto principle is used more loosely to denote that a small number of factors, inputs, occurrences and so on will usually have a disproportionate effect on an eventual outcome. Financial performances of many businesses bear out this principle – the majority of a company’s profits are often derived from a small percentage of its turnover. Thus, in a consultancy assignment, it can often be the case that a relatively small number of factors are responsible for a large part of a problem. |
| Business Capability Analysis | Capabilities are abilities of an enterprise to act on or transform something that helps achieve a business goal or objective. Capabilities describe outcome of performance or transformation, not how it is performed. Capability maps provide a graphical view of capabilities. Each capability is found only once on a capability map, even if possessed by multiple business units. Capabilities impact value by increasing or protecting revenue, reducing or preventing costs, improving service, or achieving compliance. Capabilities themselves don’t have risks. Risks are due to lack of performance in capabilities. Assess capabilities to identify gaps between expected and actual performance expectations. Use capability gaps to determine what enterprise needs to do to accomplish its strategy. |
| Lessons Learned (Retrospective) | Discusses and documents successes, failures and improvement recommendations for future phases or projects. Can include any format or venue that is acceptable to key stakeholders. Can be formal facilitated meetings or informal. Review the following: 1. Consulting activities or deliverables, 2. Final solution, service, or product, 3. Impact to organizational processes, 4. Performance expectations and results, 5. Root causes impacting performance results. |
| Observations | Elicit information by observing activities and their contexts. Active/Noticeable observation– Ask questions during process. Interrupts work flow but helps in gaining a quick understanding. Passive/Unnoticeable observation – Ask questions at end. Do not interrupt work. |
| Process Analysis | Analyzes processes for their effectiveness, efficiency, and identifies improvement opportunities. Common methods SIPOC (Suppliers, Inputs, Process, Outputs and Customers) originated in Six Sigma.Value Stream Mapping (VSM): Originated in Lean methodologies. Diagram and record wait times and processing times for every processing step. |
| Process Modelling | Sequential flow of activities. A system process model defines sequential flow of control among programs or units within a computer system. A program process flow shows sequential execution of program statements within a software program. |
| Root-Cause Analysis (RCA) | Identify and evaluate underlying causes of a problem, looking into causes occurring due to people, physical or organizational effects. RCA is used for: Two popular tools for RCA: Fish-bone diagram: known as Ishikawa or Cause-and-effect diagram, are to identify and organize possible causes of a problem. Helps to focus on cause of problem versus solution and organizes ideas for further analysis. Brainstorm potential solutions after identifying actual cause. |
| Five-whys | Ask repeatedly “Why” to find out root cause of a problem. Simplest facilitation tool to use when problems have a human interaction component. Steps: Write problem visibly. Ask “Why do you think this problem occurs?” and capture idea below problem. Ask “Why?” again and capture that idea below first idea. Continue with step 3 until you are convinced actual root cause has been identified. |
| Mind Map | Articulates and captures ideas in a non-linear (tree) structure. Ideas are grouped as topics, sub-topics, further sub-sub-topics. Mind maps use words, images, color, and connections to structure thoughts, ideas, and information. |
About Adaptive US
Adaptive US is world’s #1 leading IIBA EEP. It is the only training organization that provides IIBA certification training with Success Guarantee. Adaptive is a World Leader in IIBA CBAP training, IIBA ECBA training, IIBA CCBA training, IIBA CBDA training, IIBA CCA training and IIBA AAC training.
Adaptive is a global leader in business analysis certification training with 800+ internationally certified professional. It also conducts BA skill training on Jira, BPM, MS Visio, Balsamiq, UML, Interview Preparation as well as Resume Preparation.
Adaptive has published following books on business analysis-
- The Handbook of Business,
- 1000 BA Interview Questions,
- Business Consulting 101,
- Practical Requirements Engineering,
- Agile Business Analysis,
- Big Book Of Corporate Jargons,
- Giant Book of BA Techniques,
- Stories for Trainers,
- Practice BA Techniques with Lucidchart,
- Mastering CPRE-FL,
- CPRE-FL Question Bank,
- A Beginner’s Guide to IT Business Analysis.
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