Business Capabilities – The key to adapting trends
Different trends of different origins have an impact on companies. Depending on their half-life, their socio-cultural penetration depth and the degree of globalization, trends also develop into so-called megatrends. The challenge for a company is to identify the relevant trends, evaluate them validly, and derive and implement measures. Even the sensitivity for recognizing trends is an ability that is essential for companies. To adapt trends, i.e. for the process of deriving measures and their sustainable establishment, the development of new business capabilities becomes necessary. This article provides a compact overview of the trends that need to be taken into account, their interaction and the basic prerequisites for successful adaptation of trends. Because there is a proven method to do just that.
What are business capabilities?
A business capability defines a company’s ability to successfully perform a core activity (see Business Capability Management, page 10). The business capability approach is based on a holistic approach. It answers the question: What can a company do? This answer takes into account all levels of a company: It comprises the knowledge and skills of employees and managers, the strategic orientation of the company, its process-related implementation and the supporting technologies and machines.
The development of business capabilities is time-consuming, especially when new employees need to be hired or trained, processes need to be changed or IT systems need to be introduced. Several different skills and at different levels are needed to take advantage of the trend or to meet the requirements arising from it.
By definition, trends lead to changes in markets and boundary conditions in the corporate environment. The trend analysis answers the question of which trends are relevant for the company. Different types of trends are taken into account.
A megatrend is characterized by the fact that it is not predicted, but that it already exists. It marks a change that is already shaping society and the market and will continue to shape it over a longer period of time. Megatrends therefore span several decades, affect all people and all levels of society, and they are independent of technologies and technology trends.
Technical trends are based on technical innovations. Technical trends included topics such as cloud computing and 3D printing. They usually take effect over a shorter period of time and are therefore less comprehensive than megatrends. Even in its technical version, however, the adaptation of trends can in turn trigger megatrends, as was the case with the development of the Internet, for example: ultimately, it originated in ARPANET, which triggered the megatrend of connectivity. Technical trends are therefore of particular relevance to companies.
Trends must be viewed and evaluated in their industry-specific context. The technical trend towards digitisation, for example, has generated a new type of initiative in agriculture. Digital farming includes aspects such as high-tech combine harvesters, milking robots and sensors in animal husbandry.
Consideration of the interactions
The interaction between business capabilities, trends and business models in a digitized world can be demonstrated using the trend topic of Big Data Analysis as an example: Especially in the business models of the digital age, the focus is on the user or customer. For example, customer orientation is characterised by the fact that predictive maintenance does not result in cost-intensive downtimes for highly complex and time-critical machines, systems or devices.
The strategic decision to introduce predictive maintenance – as a company’s competence – requires the development of a large number of new skills. These take place, for example, at both the process and IT level or relate to the skills of employees.
Providing reliable information on maintenance status requires large amounts of data as well as the techniques and databases of the Big Data Analysis trend. This opens up numerous new possibilities that can shape and simplify work processes on a large scale as well as in detail. As part of the digital business model, for example, the new processes and IT infrastructures also open up new billing options. Thus, the manufacturer of an imaging procedure knows the exact number of images produced and can calculate the exact “costs per image” on this basis.
Successful adaptation of trends: from trend to ability
It is already challenging for a company to select the trends relevant to the company from the enormous variety. The key to the success of adapting trends is therefore above all to solve the task of identifying the skills required to ultimately adapt the trend.
We have developed a method to derive the required skills from the trends: “trend2ability”
(Cover picture: © Patrick Müller, background: © Rawpixel.com | Adobe Stock)