Durable Goods Industry Business Reference Architecture
Capability maps, value streams, and strategy maps for durable goods manufacturers.
- Manufacturing leadership requires a unified and validated view of business capabilities that help CIOs and leadership accelerate the strategy design process and that align initiatives, investments, and strategy.
- The business and IT often focus on a project, ignoring the holistic impact and value of an overarching value stream and business capability view.
Our Advice
Critical Insight
- Using an industry-specific business reference architecture is central, and has many benefits, to organizational priorities. It’s critical to understanding, modeling, and communicating the operating environment and the direction of the organization, but more significantly, to enabling measurable top-line organizational outcomes and the unlocking of direct value.
Impact and Result
- Demonstrate the value of IT’s role in supporting your organization’s capabilities while highlighting the importance of proper alignment between organizational and IT strategies.
- Apply reference architecture techniques such as strategy maps, value streams, and capability maps to design usable and accurate blueprints of your manufacturing operations.
- Assess your initiatives and priorities to determine if you are investing in the right capabilities. Conduct capability assessments to identify opportunities and to prioritize projects.
Durable Goods Industry Reference Architecture
Business Capability Maps, Value Streams, and Strategy Maps for the Durable Goods Industry
Analyst Perspective
In the age of disruption, IT must end misalignment and enable value realization.
An industry reference architecture helps accelerate your strategic design process and enhances IT’s ability to align people, process, and technology with key business priorities.
Durable Goods Manufacturing firms require a unified and validated view of their business capabilities that aligns initiatives, investments, and strategy in order to provide value to their clients and stakeholders.
Kevin Tucker
Principal Research Director
Manufacturing, Supply Chain & Logistics
Info-Tech Research Group
Executive Summary
Your Challenge
- You are a CIO or head of IT who needs to improve your organization’s understanding of business capabilities and how IT can support the creation of new products.
- Your organization wants to sharpen its alignment and focus on organizational outcomes and value by using automation and cost-effective methods that produce the most reliable and high-quality outcomes.
- Before executing any strategic initiatives, use this blueprint to understand how the organization creates value.
Common Obstacles
- You don’t have a clear path for capturing the right information, engaging the right people, or linking with the needs of the business and aligning with operational technology (OT).
- The business and IT often speak in their own languages without a holistic and integrated view of mission, strategy, goals, objectives, business processes, projects, and measures of success.
- OT and IT organizations often focus their attention within silos and miss the big-picture need for a synergistic approach for successful outcomes.
Info-Tech’s Approach
- Build your organization’s capability map by defining the organization’s value stream and validating the industry reference architecture.
- Use business capabilities to define strategic focus by defining the organization’s key capabilities and developing a prioritized strategy map.
- Assess key capabilities for planning priorities through a review of business processes, information, and application and technology support of key capabilities.
- Adopt capability-based strategy planning by ongoing identification and road-mapping of capability gaps.
Info-Tech Insight
Using an industry-specific reference architecture is central and has many benefits to organizational priorities. It's critical not only to understanding, modeling, and communicating the operating environment and the direction of the organization but also, more significantly, to enabling measurable top-line organizational outcomes and the unlocking of direct value.
Reference Architecture Framework
Industry Overview: Durable Goods
The Durable Goods Manufacturing industry comprises traditional manual processes where goods are produced with tools, fixtures, hand-operated tools, paper-based recording, and a whole host of other manual processes.
Many of these traditional organizations have needed to resort to very costly inspection and quality management processes to ensure that they are delivering high-quality products across all of the business sectors they serve.
In recent years the onset of new technologies has created opportunities for new market entrants to disrupt a wide range of manufacturing industries, and at the same time the quality management tools have become much more sophisticated and accurate.
New technologies for producing products, including robotics, have enabled businesses to significantly reduce costs while providing a higher quality product and also meeting the flexible on-time-delivery demands that customers have grown to expect.
Figure above: Value Chain for the Durable Goods Industry
Business Value Realization
Business value defines the success criteria of an organization as manifested through organizational goals and outcomes, and it is interpreted from four perspectives:
- Profit generation: The revenue generated from a business capability with a product that is enabled with modern technologies.
- Cost reduction: The cost reduction when performing business capabilities with a product that is enabled with modern technologies.
- Service enablement: The productivity and efficiency gains of internal business operations from products and capabilities enhanced with modern technologies.
- Customer and market reach: The improved reach and insights of the business in existing or new markets.
Value, goals, and outcomes cannot be achieved without business capabilities
Break down your business goals into strategic and achievable initiatives focused on specific value streams and business capabilities.
Durable Goods Manufacturing business capability map
Business capability map defined…
In business architecture, the primary view of an organization is known as a business capability map.
A business capability defines what a business does to enable value creation, rather than how. Business capabilities:
- Represent stable business functions.
- Are unique and independent of each other.
- Typically will have a defined business outcome.
A business capability map provides details that help the business architecture practitioner direct attention to a specific area of the business for further assessment.
Glossary of Key Concepts
A business reference architecture consists of a set of models to provide clarity and actionable insight and value. Typical techniques and terms used in developing these models are:
|
Term/Concept |
Definition |
|---|---|
|
Industry Value Chain |
A high-level analysis of how the industry creates value for the consumer as an overall end-to-end process. |
|
Business Capability Map |
The primary visual representation of the organization’s key capabilities. This model forms the basis of strategic planning discussions. |
|
Industry Value Streams |
The specific set of activities an industry player undertakes to create and capture value for and from the end consumer. |
|
Strategic Objectives |
A set of standard strategic objectives that most industry players will feature in their corporate plans. |
|
Industry Strategy Map |
A visualization of the alignment between the organization’s strategic direction and its key capabilities. |
|
Capability Assessments |
Based on people, process, information, and technology, a heat-mapping effort that analyzes the strength of each key capability. |
|
Capability |
An ability that an organization, person, or system possesses. Capabilities are typically expressed in general and high-level terms and typically require a combination of organization, people, processes, and technology to achieve. |
Source: The Open Group, 2009
Tools and templates to compile and communicate your reference architecture work
The Durable Goods Industry Reference Architecture Template is a place for you to collect all the activity outputs and outcomes you’ve completed for use in next steps.
Download the Durable Goods Industry Reference Template
Info-Tech’s methodology for a reference architecture
|
1. Build your organization’s capability map |
2. Use business capabilities to define strategic focus |
3. Assess key capabilities for planning priorities |
4. Adopt capability based strategy planning |
|
|---|---|---|---|---|
|
Phase Steps |
1.1 Define the Organization's Value Stream 1.2 Develop a Business Capability Map |
2.1 Define the Organization's Key Capabilities 2.2 Develop a Strategy Map |
3.1 Business Process Review 3.2 Information Assessment 3.3 Technology Opportunity Identification |
4.1 Consolidate and Prioritize Capability Gaps |
|
Phase Outcomes |
|
|
|
|
Info-Tech offers various levels of support to best suit your needs
DIY Toolkit
"Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful."
Guided Implementation
"Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track."
Workshop
"We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place."
Consulting
"Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project."
Diagnostics and consistent frameworks are used throughout all four options.
Guided Implementation
What does a typical GI on this topic look like?
A Guided Implementation (GI) is a series of calls with an Info-Tech analyst to help implement our best practices in your organization. A typical GI is between 6 to 9 calls over the course of 1 to 4 months.
Phase 1
Call #1: Introduce Info-Tech’s industry reference architecture methodology.
Phase 2
Call #2: Define and create value streams
Call #3: Model Level 1 business capability maps.
Call #4: Map value streams to business capabilities.
Phase 3
Call #5: Model Level 2 business capability maps.
Call #6: Create a strategy map
Call #7: Introduce Info-Tech's capability assessment framework.
Phase 4
Call #8: Review capability assessment map(s).
Call #9: Discuss and review prioritization of key capability gaps and plan next steps.
About Info-Tech
Info-Tech Research Group is the world’s fastest-growing information technology research and advisory company, proudly serving over 30,000 IT professionals.
We produce unbiased and highly relevant research to help CIOs and IT leaders make strategic, timely, and well-informed decisions. We partner closely with IT teams to provide everything they need, from actionable tools to analyst guidance, ensuring they deliver measurable results for their organizations.
What Is a Blueprint?
A blueprint is designed to be a roadmap, containing a methodology and the tools and templates you need to solve your IT problems.
Each blueprint can be accompanied by a Guided Implementation that provides you access to our world-class analysts to help you get through the project.
Need Extra Help?
Speak With An Analyst
Get the help you need in this 2-phase advisory process. You'll receive 8 touchpoints with our researchers, all included in your membership.
Guided Implementation 1: Model
- Call 1: Introduce Info-Tech’s industry reference architecture methodology.
- Call 2: Define and create value streams.
- Call 3: Model Level 1 business capability maps.
- Call 4: Map value streams to business capabilities.
- Call 5: Model Level 2 business capability maps.
Guided Implementation 2: Drive
- Call 1: Introduce Info-Tech's capability assessment framework.
- Call 2: Review capability assessment map(s).
- Call 3: Discuss and review prioritization of key capability gaps and plan next steps.