Imagine setting out on a road trip without a proper map. You’ve got a destination in mind, but without knowing your starting point, the routes available, or the roads that connect them, even the best route planner can’t help you get there. The same is true in business – if you don’t know what your organization is capable of today, how can you effectively plan for tomorrow?
That’s where business capability maps come in. Like a reliable GPS, they help you pinpoint your current position – giving you a clear, structured view of what the business does and how well it does it. Whether you're building out your enterprise architecture, managing your IT portfolio, or crafting a digital transformation strategy, capability mapping provides the foundations and clarity needed to move forward with confidence.
What is a business capability?
A business capability is what an organization needs to be able to do in order to achieve its goals. It represents the stable, long-term abilities of the business, regardless of organizational structure, people, or technology.
Capabilities are not tasks or processes. Instead, they’re outcome-oriented constructs that blend people, processes, data, and tools into a single view of what the business can do.
Example: Supplier relationship management is a business capability. It might include contract negotiation, performance monitoring, and supplier risk assessments. It doesn't matter how these are performed – only that the organization needs this capability to function effectively.
This perspective is foundational in enterprise architecture and business analysis, providing the scaffolding for capability maturity, strategic prioritization, and investment planning.
What is a business capability map?
A business capability map is a structured and visual representation of the organization’s capabilities. It organizes capabilities into a hierarchical model, offering a clear, intuitive view of what the business does at various levels of detail.
Capability maps typically follow a tiered format:
- Level 1: Core domains (e.g., finance, customer engagement, operations)
- Level 2: Sub-capabilities (e.g., billing, customer onboarding)
- Level 3: Detailed activities (e.g., Invoice processing, identity verification)
Example: A Level 1 capability such as customer engagement might include:
- Level 2: “Lead management”, “customer support”, “account retention”
- Level 3: “Campaign tracking”, “support ticket resolution”, “loyalty program management”
Business capability maps are often used to support transformation initiatives by organizing capabilities in a structured way. This may include connecting them to strategic goals to clarify how each function contributes to broader business outcomes.
By aligning capabilities with operational elements like processes, people, information, and technology, capability maps foster a holistic understanding of business operations, enabling effective transformation efforts.
Key components of a business capability map
A well-designed capability map visualizes the complex relationships among operational elements within a business. The core components include:
1. Capability hierarchy: The hierarchy is the backbone of a capability map. It organizes capabilities into tiers – starting with broad domains and drilling down to more specific functions. This layered structure allows for clarity and alignment across business units.
Example: Under the top-level capability “Finance Management,” you might have:
- Level 2: “Accounts payable,” “Budgeting and forecasting”
- Level 3: “Invoice reconciliation,” “Cash flow Forecasting”
This hierarchy makes it easy to trace how individual activities contribute to broader capabilities, which in turn support the organization’s high-level strategic outcomes.
2. Processes: Processes bring capabilities to life by detailing how work gets done. Mapping the processes that support each capability helps identify inefficiencies, automate workflows, and ensure consistency across the enterprise.
Example: The “Customer onboarding” capability may include processes like:
- “Know Your Customer (KYC) document verification”
- “Credit scoring”
- “Welcome communication sequence”
Linking these processes to capabilities strengthens business-IT alignment and supports your digital transformation strategy.
3. People: Every capability depends on people – whether through individual roles, team structures, or specialized skillsets. Mapping organizational responsibilities provides insight into who supports a capability and whether resources are aligned to strategic priorities.
Example: The “product lifecycle management” capability might involve:
- Product managers
- R&D engineers
- Regulatory compliance officers
Understanding this human layer enables better planning, resourcing, and change management.
4. Technology: The use of technologies underpins the execution of every business capability. By mapping systems and applications to capabilities, organizations can assess the impact of technical debt on their business, reduce redundancy, and plan for future growth
Example: The “order fulfilment” capability could be supported by:
- An Enterprise Resource Planning (ERO) platform for inventory control
- A Warehouse Management System (WMS) for logistics
- A third-party shipping application programming interface (API)
This insight feeds directly into enterprise initiatives like application rationalization and IT portfolio optimization.
5. Information: Information includes the data, records, and documents that flow through each capability. Understanding the data layer is critical for improving decision-making, ensuring compliance, and enabling data-driven transformation.
Example: The “claims management” capability in insurance relies on:
- Customer records
- Policy documents
- Claim photos and assessments
Data is a core asset that organizations can leverage to evolve, consolidate, and optimize their business capabilities. Aligning data with capabilities also supports stronger governance and helps identify gaps that could impact business performance.
What is the purpose of a business capability map?
The purpose of a business capability map is to provide a consistent, enterprise-wide view of what the organization does – enabling better alignment across strategy, IT, operations, and transformation.
Used at its full potential, a capability map supports:
- Strategic decision-making: by tracing business goals to impacted operational elements (people, process, data, technology) through the use of capabilities
- Investment prioritization: by showing where to build, buy, improve, or retire capabilities
- Transformation planning: through capability assessments and maturity benchmarking
- Application rationalization: by mapping systems to capabilities and eliminating redundancies
Example: A telecom provider might use a capability map to reveal that the “billing operations” capability is supported by five overlapping platforms. This insight leads to an application consolidation initiative tied directly to its IT strategy.
How are business capability maps used?
Business capability maps are especially valuable during digital transformation strategies, post-merger integrations, and enterprise-wide optimization efforts, where cross-functional alignment is essential.
Here are some of the most common – and impactful – ways capability maps are used in practice:
Understanding current state maturity: Gain a comprehensive view of organizational strengths and weaknesses.
- Example: An enterprise may discover that its “customer insights” capability has low maturity and is reliant on fragmented data – prompting targeted investment in analytics tools and skills.
Identifying bottlenecks and gaps: Pinpoint areas for development or realignment.
- Example: A financial services firm maps its “regulatory reporting” capability and discovers it depends on legacy spreadsheets with no version control, creating compliance risks.
Strategic planning: Prioritize investments in high-value capabilities to drive performance.
- Example: A manufacturer prioritizes automation investments in its “supply chain visibility” capability to enhance agility and reduce lead times.
Facilitating communication: Foster collaboration with a shared framework for cross-functional teams.
- Example: During a merger, both entities align on a common capability map to integrate operations and clarify overlapping functions.
Performance measurement: Track metrics to assess and improve operational outcomes.
- Example: A retail organization measures improvements in its “order fulfillment” capability after optimizing warehouse operations and introducing new logistics software.
Want more guidance beyond business capability mapping? Get the details in our dedicated eBook: ‘Organizational Best Practices for Business Capability Management’!
Best practices in business capability management
Business capability mapping is the process of visually representing what an organization does. Business capability management, on the other hand, is the ongoing practice of assessing, prioritizing, and evolving those capabilities to support strategic goals.
To get the most out of your capability initiative, follow these proven best practices:
- Get the right people involved: Include architects, analysts, and executive sponsors to ensure strategic alignment.
- Start broad, not deep: Focus first on high-level capabilities; only drill down where necessary.
- Use a Business Model Canvas: This tool helps link capabilities to customer value, key resources, and strategic outcomes.
- Define assessment criteria: Score capabilities based on maturity, importance, supporting processes, people, and technology.
Connecting capability mapping to business architecture
Business capability maps are a key input into broader business architecture efforts. They provide the structural lens to understand what the organization does – laying the groundwork for how strategy can be executed effectively.
Want to explore that next step?
Catch our webinar, ‘Unlocking Strategy Execution Through Business Architecture,’ to see how business architecture brings together capabilities, processes, goals, and governance to drive real transformation.
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