The OMG (Object Management
Group) Business Motivation
Model (BMM) defines a framework for the capture of strategic planning
information. This framework reflects widely
accepted strategic planning techniques.
The resulting strategic plans define requirements for business changes,
but there remains a significant gap between these requirements and the
realities of implementation. VDML (Value
Delivery Modeling Language) can help bridge this gap through a more rigorous
specification of the current state of the business and the future, desired
state. See Value
Delivery Modeling Language: An Update for an
overview of VDML.
In this article, I will begin with a brief overview of BMM
and then discuss the application of VDML to further detail and refine the
strategy and to support transformation planning and management.
Overview
of BMM
The diagram, below, is an abstraction of the Business
Motivation Model (BMM) taken from the OMG specification. I will briefly discuss the Means and Ends
that represent a strategic plan.
Influencers and Assessment are elements of the strategic planning
process that provide input for development and refinement of the plan, but they
are not, per se, elements of a strategic plan.
End
The End contains elements that define the desired future characteristics
of the enterprise including the Vision and Desired Result.
Means
The Means contains elements that describe how the future
state of the enterprise will be achieved including Course of Action and
Directives.
Vision
A strategic plan, at the most abstract level, is expressed
as a Vision of what the enterprise wants to be and how it wants to be
perceived. This is complementary to the
Mission.
Mission
The Mission expresses why the enterprise exists--what it
wants to accomplish. Successful pursuit
of the Mission should support realization of the Vision. 
Desired result
The desired result consists of Goals and Objectives.
Goal
A goal is a long-term, qualitative result that the
enterprise may already be pursuing or that may be advanced as a result of a
business challenge or opportunity. It
defines a purpose for the strategy.
Objective
Objectives are specific, measurable results to be achieved
by a strategy and support enterprise goals.
While there may be many measures of performance, objectives focus on
selected, key measurements that reflect progress toward the strategy and goals
from a management and investor perspective.
Course of Action
A course of action is the approach to implementation of the
Mission in pursuit of the Goals and Objectives.
It consists of Strategy and Tactics.
Strategy
A strategy defines how the mission will be pursued and
objectives will be achieved. In
conventional strategic planning, it is an abstract description of how the
enterprise will operate in the future.
Typically, there will be multiple aspects to a strategy, potentially
representing the integration of different ideas.
Tactic
Tactics are incremental changes to the state of the
enterprise that lead to the desired future state required by the Strategy. The distinction between strategy and tactics
is somewhat subjective. Tactics will
focus on resolving particular problems and steps toward implementing related
changes.
Directives
Directives are the business policies and business rules that
are to be incorporated in the future state of the enterprise.
Business policies
Policies are statements of business operating requirements.
Business rules
Business rules define operating criteria or constraints in
specific circumstances. Business rules
implement business policies.
Application of VDML
In my previous post, I gave a brief overview of VDML: Value Delivery Modeling Language: An Update . Here I will focus on the application of VDML for the refinement and implementation of a strategy. This is not intended as a standard method, but illustrates how VDML can be used to improve the discipline and rigor of strategic planning and transformation.
VDML does not address all aspects of a business transformation. I expect that VDML will be used to support strategic planning and transformation program management for the operations and capabilities of the business. It will be complemented by related efforts such as development of policies, analysis and development of markets, design of incentives and development of contractual relationships.
Development of a single idea
In this section, I will define an approach for development
and implementation of a strategy for one idea.
I the next section I will extend this to consider multiple ideas in an
on-going business transformation.The basis for consideration of changes is a VDML As-Is model. This represents the current state of the business and will contain measurements reflecting current business operations. The current set of measurements may be in a VDML scenario with another scenario set of measurements representing target measurements. The As-Is model may actually be a composite of VDML models representing different parts of the business. The important point is that the current business design and measurements, including value propositions, are established as a basis for evaluating and planning changes. It provides a context for understanding problems and assessing solutions.
An idea is a potential strategy at an inspirational stage of
development. When that idea is refined,
validated and accepted, it becomes a strategy (or a component of a more complex
strategy). We start with consideration of one idea to improve the
business. We will focus on aspects of
the idea that involve changing the operation of the business. This may include the impact of new
technology, changes in capabilities, activities, resources (including personnel
and their skills), organizational changes and the implications to value
propositions (potentially multiple market segments). The diagram, above, depicts steps of
development of an idea through transformation of the business. I will discuss each of these steps in the
paragraphs that follow.
1.
Model alternative implementations
I will assume that there are alternative approaches to
implementation of the idea under consideration.
Each alternative should be modeled as a VDML To-Be model. The VDML model will support analysis of the
idea to define a cohesive impact on the organization, capabilities, activities,
resources, value contributions and value propositions, potentially including business
partners. Each To-Be model may include new capability methods, some new activities and stores, elimination of some old activities and stores, changes to existing capabilities, changes to organization structures, additions/deletions and changes to business items, changes to staffing and possibly some new types of value measures. These To-Be models are both the basis for validation and refinement of the idea and for selection of the preferred implementation alternative. Note that VDML provides the ability to assess changes from an enterprise perspective such as the impact of changes to a shared capability used by other lines of business.
VDML measurements are based on a unit of production. Consequently, capacity requirements for resources and facilities must be computed by multiplying such measurements by projected production volumes.
2.
Select from alternatives
Each alternative To-Be model is compared to the As-Is model
to identify the changes required. On the
surface, this will likely involve changes to activities and associated capabilities,
but these may require organizational changes and training or replacement of
personnel to obtain necessary skills.
Capabilities may require new or expanded facilities. The To-Be model provides the basis for
estimating activity value contributions as a result of the changes along with
their impact on value propositions. It
also provides the basis for estimation of transformation costs and duration. These measurements, along with other, non-VDML
factors will be the basis for selecting an alternative. Even if there are no alternatives, this is an
essential step for the steps that follow.
3.
Define implementation phases
An idea is now a strategy for which an implementation plan
must be developed. VDML will provide the
basis for planning the work of transformation.A plan should have phases of implementation for partitioning and managing work. Phases should define incremental development and potentially achieve short-term benefits rather than waiting for full implementation of an idea to evaluate the work and realize the desired benefit. This also provides the opportunity for periodic re-assessment and adjustment of the strategy for changed circumstances.
The changes identified in step 2, above, must be organized into implementation phases. Each phase will have a package of changes to be implemented together. Some changes may be dependent on others—the VDML deliverable flows will help identify these dependencies. Some changes may achieve greater benefits than others. The priority of changes may be affected by the benefits as well as the availability of funding or resources. Each phase should achieve implementation of a stable business state that can be measured. If possible, each phase should yield business benefit.
4.
Model next phase To-Be
Transformation program management will iterate over the
current and remaining steps for each phase of the strategy implementation.Prior to each phase, a To-Be model is developed or refined for the next phase. The To-Be model incorporates the activities, capabilities and resources to be developed in that phase. This, in turn, identifies the organization units responsible for the changed business operations as well as the organization units of related activities that will require collaboration and coordination.
Based on the phase To-Be business design, a project plan is developed for the phase. This will define cost and duration targets for the transformation work along with a timetable for transformation resource requirements.
5.
Define phase objectives
Each phase should have defined objectives for affected
organization units as well as the overall impact of the undertaking. An idea may affect multiple market segments
and thus multiple value propositions.
The phase To-Be model includes measurements for the expected value
contributions of activities that are affected by the transformation. Changes to value contributions for each affected activity will be targets for performance by the organization unit that provides the supporting capability. Where capabilities are engaged through delegation, organizations responsible for each level of delegation will have target measurements to meet. The impact on aggregated values will be targets for the overall undertaking for the enterprise or the targeted line(s) of business.
6.
Implement the phase plan
This step involves doing the work of transformation. Each phase may be managed as a separate project
with a detailed plan. The project must
address all aspects of the transformation for that phase including changes in
products, technology, organization, personnel, facilities, information systems,
and activity inputs and deliverables. Some
aspects are beyond the scope of a VDML model, but the VDML model will help
identify them.
7.
Evaluate objectives
At the end of each phase, an As-Is model is created as a new
baseline. This model should be very
similar to the To-Be model for the phase, but the measurements are actual value
measurements. These measurements are
compared to the To-Be expected value measurements to evaluate success of the
phase. The As-Is and To-Be models may be
two VDML scenarios since they should have the same structure but with actual vs
expected measurements. While the implementation effort may be completed, there may still be work required to stabilize and optimize the capabilities, so there may be some additional time allowed to achieve the targets. In the meantime, work may proceed on the next phase, returning to step 4, above.
When the last phase is completed, the overall success of the strategy and transformation can be evaluated by comparing actual measurements of the final As-Is model to the expected measurements of the final To-Be model.
Transformation as a continuous process
In the real world, enterprises do not focus on the implementation
of one idea at a time. As some ideas are
being implemented, other ideas will emerge.
These new ideas will affect some of the same business elements
undergoing transformation. Some ideas
will be completed while work on other ideas remains to be done.Consequently, a strategy may include multiple ideas that must be reconciled, and it may evolve to include new ideas over time. A VDML model supports analysis of the application and integration of these ideas to achieve a coherent strategy. The definition of tactics and assignment to teams could result in different interpretations and implementations of the strategy, but a VDML model can provide a shared context for identification and resolution of potential inconsistencies.
The following paragraphs extend the above transformation steps to reflect on-going, continuous transformation for implementation of multiple ideas. The numbers in parentheses indicate the affected steps in the above diagram.
Evaluate To-Be
alternative models (2)
A new idea may be evaluated and change requirements
identified based on the current As-Is model, but the overall evaluation should also
consider changes already planned for other ideas that affect some of the same
business elements. This extension effect
can be assessed by using the To-Be model for completion of the current,
composite strategy so that any planned changes are included in the baseline for
the new idea. Note that there may be
trade-offs with the implementations of adopted ideas to be considered in
solutions for each new idea.
Align changes to
phases (3)
The changes for the new idea must be reconciled with the
To-Be models of pending phases of the current strategy, and the program plan
must be updated to reflect these changes.
If there are no related changes, then implementation of the new idea may
be considered as an independent effort.
When changes affect some of the same activities and supporting
capabilities, there must be a determination if they should be included in an
existing phase or will require a distinct phase. This may be affected by the priority of the
idea, funding, resource requirements, or other factors such as risk and scope
of change. Changes to the work of
existing phases may result in new dependencies and thus require changes to the
order of pending phases.
Revise phase To-Be
model(s) (4)
Based on the alignment of new changes to pending changes, a
To-Be model must be developed or adjusted for the current phase or at least the
next phase. To-Be models for additional
phases may be deferred, particularly if the work of pending phases or new ideas
are likely to result in adjustments to the model.The next phase To-Be model is important, as before, for development of expected value measurements for the phase.
Revise phase
objectives (5)
To the extent the next phase is expected to achieve
different results with the newest idea, it will be necessary to reconsider
which value measurements are key to evaluation of success of the phase.
Ideas completed (6)
In a continuous transformation environment, implementation
of some ideas will be completed while work on other ideas continues. When the changes for an idea are completed,
the result should be evaluated against the To-Be expected value measurements of
the original idea. The targets should be
at least achievable in the near future (allowing for stabilization of
operations), or exceeded if changes for other ideas have contributed
improvements.
Conclusion
A VDML To-Be model for a strategy and the series of To-Be models for each phase of the implementation define requirements for transformation of the business. The phases reflect priorities and dependencies between changes. The To-Be model for a phase reflects the expected impact on the value measurements, activities, capabilities, organizations and resources affected. Value propositions provide the basis for consideration of the competitive impact of the phase.
The effort to implement these phases must be defined in a
transformation plan. This plan might be
defined as a program plan with plans for phases defined as project plans. The requirements defined by the strategy To-Be
model are the basis for the more detailed design and development of resources,
business processes, organization roles and responsibilities and performance
measures.
VDML also provides the basis for definition of BMM
Objectives. Implementation phases as
well as the final To-Be model provide a basis for estimating costs and
durations, and the expected value contributions and impact on value
propositions. Key measurements or
milestones should be identified as strategic planning Objectives of the BMM
Desired Results.
The To-Be VDML models provide insight on requirements for IT
support and system changes, for application of business policies and rules, and
for consideration and mitigation of risks.
Application of VDML will bring a change to the way strategic
planning and business transformation are performed. Not only will it enable better planning and
monitoring, but it will enable more effective management of complex and
multi-faceted transformations needed to keep up with rapid changes of business
and technology.
Acknowledgements
My work on alignment of VDML with BMM and support of strategic planning has been in collaboration with Henk de Man, Director of Research at Cordys.
