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Strategy Mapping Fundamentals

Sparx Services North Americawww.sparxsystems.us

The Business Architecture Summit

About Sparx Services North America

“Align information technology and systems engineering capabilities with business strategy using industry best practices

and industry leading tooling to deliver world-class results.”

� Industry thought leader in enterprise architecture, business architecture, systems and software engineering, business analysis, and agile methods

Member and contributor to

TCBAF Business Architecture Summit 2018 – Strategy Mapping Fundamentals

� Member and contributor to� UML®, SysML®, SPEM, UPDM™/UAF, BACM at OMG®

� TOGAF®, ArchiMate®, IT4IT™ at The Open Group®

� UML Profile and Metamodel teams at Business Architecture Guild®

� Open Group Accredited Training Provider, Guild Accredited Training Partner™, IIBA® Endorsed Education Provider (EEP™)

What is Business Agility?

� “...the ability of an organization to sense

environmental change and to respond

efficiently and effectively to that change.”

- Gartner, 2006

� Effectively achieving agility requires

the business to…

� Anticipate and characterize change

� Understand impact of change on existing

strategy and in-flight initiatives

Business Architecture Framework4

Business Architecture Knowledgebase

� Blueprints provide views into knowledgebase, based on stakeholder concerns

� Scenarios contextualize expected outcomes of business architecture work

� Also inform initial selections of key stakeholders and likely concerns

BIZBOK® Guide 6.5

Deliver Strategic Outcomes – Value Stream5

Deliver Strategic Outcomes – Entrance/Exit Criteria6

Strategy Map – Definition

� “Articulates a strategy in such a way that it can be readily interpreted and acted upon”� “A collection of techniques that are used to enable organization to gain

visibility into the way that strategic tradeoffs are made between competing objectives”

� Strategy defined as “the pattern or plan that integrates an organization’s major goals, policies, and action sequences into a cohesive whole”

� Balance top-down, high-level objectives with bottoms-up, low-level

� Balance top-down, high-level objectives with bottoms-up, low-level objectives

� “Provides both a map of how decisions have been reached”� “As well as a guide for what choices are currently under consideration”

� “The exercise of planning remains much more valuable than confirming to any particular strategic plan”� “In preparing for battle, I have always found that plans are useless, but

planning is indispensible.” – General Dwight D. Eisenhower

BIZBOK Guide 6.0

Strategy Mapping – Benefits

� Support organizational alignment� Strategies are only as effective as the ability to align organization

to those strategies

� Open up discussions of implications to wider, deeper audience

� Improve communication and fidelity of objectives� As strategy is communicated across business units and down

layers, each community may interpret it differently

� Connect intent with specific, unambiguous objectives

� Assist organizations in adapting rapidly� Pace of change and rate of competition requires effective

innovation

� Help understand how to respond to newly identified opportunities and threats

� Provide framework for bubbling up ideas from lower levels

BIZBOK Guide 6.0

Strategy Mapping – Benefits

� Enable rationalization of initiatives� Need clear governance framework for aligning proposed

initiatives to strategy

� Provide context to continually re-evaluate in-flight initiatives as understanding deepens and new changes occur

� Support capability-centric investment management� Smaller initiatives may not have enterprise recognition

� Smaller initiatives may not have enterprise recognition

� May be over-investing in non-differentiating capabilities or unnecessary redundant deployments

� Provide ability to monitor organization’s progress towards strategic objectives� Enable linking high-level strategies to low-level strategies

� Create strategic dashboards to demonstrate ongoing alignment

BIZBOK Guide 6.0

Strategy Planning – Approach

� Many organizations have little formality in strategy definition

� Feel formalization constraints innovation

� Other organizations have formal strategy management

� Feel formalization critical to informing executive decision making

� Unified approach to organizational change a critical differentiator

� Incrementally describe

� What an organization might do

� What an organization can do

� What an organization wants to do

� What an organization should do

Integrated Enterprise Planning Processes

Innovation

ManagementStrategic

Planning

Transformation

Planning

• Market analysis

• Disruptive

technology • Rationalized strategy

• Enterprise scope definition

• High-level target state

• Capability assessments

• Detailed target state

• Gap analysis

• Readiness assessment

• Implementation strategy

• Transformation roadmap

Initiative

Planning

Tactical

Planning

• Sponsor

submitted “big

changes”

• Board-level

directives

Architecture

Demand

Management

• Allocated

funding and

resources

• Prioritized

portfolio

Business Model Alignment12

� Business model allows stakeholders to clearly articulate what it wants to accomplish� Business architecture delivers views of business that can be targeted for

improvement, rearranged, redeployed, refined, or transformed

� Business architecture provides platform for planning, implementing, and operating the desired business model

Business Model Canvas13

Business Model Canvas- Alexander Osterwalder

Strategy Mapping – Principles

1. Business strategies relate to a particular “community of interest”� Ground planning from diverse stakeholder perspective

2. Business strategies are created to respond to the external environment� Operational ecosystems come with specific opportunities and constraints

3. Business strategies are evaluated using value analysis� Strategy describes approach to preserve and increase value

Understand opportunities for differentiation

� Understand opportunities for differentiation

4. Business strategies leverage and build upon existing organizational capabilities� Need to understand “core” capabilities and which ones are considered

differentiators

� Validate strategy against current capability performance

Principles 1-3 represent what an organization might doPrinciple 4 represents what an organization can do

Ecosystem Model15

Organization

StakeholderValue Item

Exchange

Capture and Categorize Ideas16

Cross-Map Ideas to Capabilities & Value Streams17

IdeaCapability Value Stream

Strategy Mapping Frameworks

Opportunity identification

� Ansoff Product/Market Grid

� SWOT Analysis

� Five Forces Model

Formal mapping techniques

� Norton Kaplan Strategy Map

� Business Motivation Model (BMM)

� Hoshin Kanri

SWOT Analysis – Concept 19

� Similar to Ansoff, but different perspectives (late 1960s)� Capability dimension – Strengths and Weaknesses

� Environment dimension – Opportunities and Threats

� May be too simple for complex markets

Assessment Map20

Strategy Assessment21

Assessment Summary22

Norton and Kaplan Strategy Map – Example 23

� Based on principle that most strategic failures are not about bad strategy, butpoor execution

� Driven by metrics-based balanced scorecards that are hierarchically rolled up

Balanced Scorecard – Concept 24

� Strategic performance management framework

� Initially introduced by Kaplan and Norton in 1992

� Composed of direct and indirect metrics

Balanced Scorecard – Example 25

Identify Objectives for Transformation Initiative26

Initiative Objective

Cross-Map Ideas to Business Strategies27

Strategy

Cross-Map Strategy28

Target

Source

Consolidate all lead and customer information

CRM Strategy

Plan targeted campaigns

Reduce operational activities of sales leader

Retire custom CRM-related applications

Understand lead sources and lifecycles

Source

Consolidate all lead and customer information

CRM Strategy

Plan targeted campaigns

Reduce operational activities of sales leader

Retire custom CRM-related applications

Understand lead sources and lifecycles

Capability Improvement Requirements29

Heat Mapped Capability Model30

Value Stream-Based Improvement31

Business Motivation Model32

(BMM) v1.3

Rationalized Business Strategy33

Strategy Drives Towards Goals34

Business Strategy – Business Unit Alignment35

BU strategy

does not map

to enterprise

strategy

Enterprise goal with

related goal in each BU

� Possible synergy

Enterprise

goal with no

BU goals

Conclusions

� Establish common vocabulary with business architecture to provide clarity when discussing, evolving, and formulating business strategy

� Align strategic planning with business architecture to provide end-to-end transparency across enterprise � Provide foundation for assessment and trade-off analysis

Enable impact analysis on key business architecture perspectives

� Enable impact analysis on key business architecture perspectives (value streams, capabilities, organizations, etc)

� Rationalize business strategies using business architecture modeling best practices� Improve understanding by business architecture community and

related stakeholders

� Enable integration of multi-level strategies to understand alignment and flow-down

Thanks for your attention

and participation!

http://www.sparxsystems.us

chris.armstrong@sparxsystems.us

and participation!

Sparx and the names of Sparx’s products are trademarks or registered trademarks of Sparx Systems Pty Ltd.

The Open Group, The Open Group Architecture Framework, TOGAF, IT4IT, and ArchiMate are trademarks or registered trademarks of The Open

Group in the United States and other countries.

BIZBOK, A Guide to the Business Architecture Body of Knowledge, Certified Business Architect, CBA, Guild Accredited Training Program, and GATP

are trademarks or registered trademarks of the Business Architecture Guild.

Object Management Group, OMG, the OMG logo, Business Process Modeling Notation, BPMN, the BPMN logo, OMG SysML, UPDM, Unified

Modeling Language, UML, and the UML logo are trademarks or registered trademarks of the Object Management Group, Inc. in the United States and

other countries.

Other company, product, or service names may be trademarks or service marks of others.

Additional Diagrams

Sparx Services North Americawww.sparxsystems.us

BIZBOK Strategy Metamodel39

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