Business Enterprises and Value
Business enterprises, irrespective of their location, size, industry or form, i.e., brick and mortar or virtual, all define their vision, goals and objectives that they aspire to achieve. To achieve these, business enterprises create and deliver value to their customers through products, services or both.
Resources and Capabilities
Business enterprises require resources and capabilities to create, deliver and manage these products and services through their lifecycles.
According to ITIL 4, resources include financial resources, infrastructure, applications, information and the number of people a business enterprise needs to create and deliver the envisioned product and services. In addition, business enterprises also require specific capabilities to ensure that acquired resources are deployed appropriately to create and deliver these products and services, making each business enterprise unique with a distinct set of products and services.
While resources are relatively more accessible and readily available, capabilities represent uniqueness and may be hard to acquire. Capabilities, accordingly to ITIL 4, include management of a business enterprise (including leadership), its organization, processes that it follows to create and deliver those unique products and services, the knowledge that it creates and requires to make informed decisions and unique people with specific skills and competencies. Capabilities enable business enterprises to use and acquire resources in a way that leads to the creation of exclusive products and services. The departure of critical capabilities may have a tremendous impact on the ability of business enterprises to continue to operate in ways that create those distinct sets of products and services to begin with. For instance, when Steve Jobs passed away, we saw a direct impact on Apple stock prices because, on that day, Apple did lose a very specialized and unique capability without which Apple would not be able to produce as innovative products and services as it used to. Did it prove to be true? A discussion for another day.
Target Operating Models or TOMs
Business enterprises need to define what specific resources and capabilities they will need to ensure that they can create and deliver their products and services and generate the desired value for their customers. Operating models, commonly known as Target Operating Models (TOMs), enable business enterprises to define what specific resources and capabilities they business enterprise will need and how they will need to operate in the future with these resources and capabilities such that each business enterprise can realize it's defined vision, goals and objectives through creation and delivery of unique products and services in manners that generates expected value for its customers.
Defining and implementing these Target Operating Models requires a disciplined approach and practical application of some industry best practices and frameworks. Learning Tree offers TOGAF, ITIL 4, COBIT Training, PMBOK, SOA, SCRUM, RUP, SAFe and others.
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This piece was originally posted on January 31, 2018, and has been refreshed with updated styling.