Business Services Vs Capabilities - A critical decision point for company success

Enterprise Architecture May 19, 2023

Andrew Swindell explores the many choices that companies now have to develop critical business and technology services rather than the full deployment required for business capabilities in this new eBook. Companies need to plan their mix of capabilities and services to enable the agility and change in company direction required to meet new market opportunities.

Deploying your Architecture value through Services Planning and Business Capability planning enables a stronger fit and strategy alignment between business and technology teams. If you are a mature Architecture organization, the opportunity exists to enhance your Architecture outputs and value to the business through a hybrid Architecture approach that does not focus solely on developing and uplifting business capabilities.

There is an alternative to consider and it doesn’t require you to own all of your IT Assets nor require you to spend long project delivery time building and embedding business capabilities that can be sourced, managed and enabled through business and technology services. ITIL defines a Service as “a means of delivering value to customers by facilitating outcomes customers want to achieve without the ownership of specific costs and risks”.

In a business or technology sense, this enables significant agility, risk management and financial control but requires a strong planning, contract management and internal ownership base to ensure you are actively managing the service outcomes according to your business and technology needs. The term XaaS refers to “Everything as a Service” or “Anything as a Service” and reflects a growing market for developing technologies in the cloud and enabling subscription based cost models that can rise and fall with business demand.

On the other hand, defines a business capability as the expression or articulation of the capacity, materials and expertise an organization needs in order to perform core functions. The longer term needs of the business may or may not be better met through actual ownership of business capabilities. More and more companies in industries such as Banks and Telecommunications are questioning whether leveraging external service providers that are not core to the main business is a more effective value proposition.

In this article Andrew Swindell will explore the new Architecture landscape with the advent of XaaS enabling lower Total Cost of Ownership, less impact on business stakeholders, agile project delivery and improvements in the way you manage your Application Portfolio, free of the longer term costs to owning and retaining business capabilities.

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