What Is Capability-Based Planning?

In a business context, capability-based planning is an approach that ensures that changes in an organization are aligned to the overarching strategic vision.

The approach has its origins in defense and military planning by the likes of the US, UK, Australia and Canada. More recently, it has become popular in the business domain, particularly for developing systems and IT-related strategies.

The overall theory is that those organizations with superior capability to execute strategy will win – whether they are the armed forces or a business.

Whilst capability-based planning has long been the tool of trade for military planners and strategists, consultants and enterprise architects, it hasn’t yet been widely understood or adopted in the broader community.
What is a Capability?

A capability describes what the business does and should not be confused with just the skills or competencies of the people (which the HR function also refers to as a capability).

So, a business capability is described by more than just the people perspective; it includes the process and physical perspective. In other words, a business capability can describe the processes involved, the physical objects used, and the people roles and skills required as well.

For example: a software development capability would encompass not just the developers (people), but processes such as Agile methodology, and physical assets such as software tools and hardware.

The diagram below shows a couple of example capabilities with associated sub-capabilities.

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