WorkFit Feature Round-up: Assessing Capabilities
by Daniel Luby, on Nov 9, 2016 8:45:00 AM
Thank you to everyone who attended the Capabilities Demystified Webinar Series. The turn out was wonderful. Many of the attendees provided great questions that made it easy to pick this months WorkFit Round-up topic. During the WorkFit Demo session we received several questions targeted at Capability Assessments. So we thought we'd recap on the key points and product functionality to address those questions.
Jeff Scott mentions in his blog post “Capabilities Demystified-Part 3” the first step in assessing a capability model is to determine value contribution, then (and only then) assess performance. This entails determining the strategic and financial impact of the capabilities which results in a contribution map.
Organizations then assess the model on how effective and efficient the capabilities are in comparison to the industry standard. This results in the creation of a performance map. The combination of the contribution and performance maps form a calculated heat map.
Some of you may be asking what happens next?
Workfit offers organizations the flexibility to perform a more granular assessment of their capability model.
Adjusted Heat- The tool uses an algorithm to determine heat scores based on the four criteria mentioned above. It is a best practice for organizations to review their completed heat map and make any necessary adjustments using the adjusted heat function.
Resource Health- Once an organization has finalized their heat map they can begin to do a root cause analysis of their heat map. It is important to have an understanding of what is causing capabilities to be ineffective and inefficient as this impacts an organizations ability to close gaps.
- People- Are adequate resources allocated to the capability? Do they have sufficient training?
- Process- Are the processes that support the capability outdated? Are their steps that could be eliminated? Could the process be automated?
- Technology- Are the applications and systems supporting the capability modern or antiquated? Are there cost reduction opportunities?
Establishing which of these root cause items is responsible for the heat allows organizations to create targeted projects to address the heat and close the capability gap. This insight also helps organizations determine the cost of closing the capability gap, which in turn enables the correct prioritization within the investment roadmap.
Sourcing- Not all capabilities are created equal. Business necessity capabilities have a low strategic and financial impact on organizations. This makes them a prime candidate for outsourcing if there is any heat related to them.
- Proprietary Knowledge- It is valuable to determine which capabilities have a low degree of proprietary knowledge. Meaning to execute the capability, very little information is needed that an organization is not willing to share with external organizations. This makes the capability a good candidate for external sourcing. E.g- Processing Payroll. World class payroll is not a competitive advantage.
- Tightly Coupled- Analyze if the capability is tightly coupled into your company’s internal processes, and cannot be extracted easily. If yes, this makes the capability a poor candidate for external sourcing. E.g- Advantage Capabilities. Attracting, Assembling and Retaining world class talent are not capabilities an organization would want to outsource.
The assessment of the categories "proprietary knowledge" and "tightly coupled" leads to the generation of a sourcing canvas.
Custom- Organizations have the flexibility to create their own assessment categories. This allows for the capability model and assessment to be tailored to any type of industry or project.
Performing these detailed assessments better enables organizations to focus in on the key capabilities that need improvement. The granular assessments also provide information on which capability gap closure projects would be quick wins.
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