The strategy elements are typically used to model the strategic direction and choices of an enterprise, as far as the impact on its architecture is concerned. They can be used to express how the enterprise wants to create value for its stakeholders, the capabilities it needs for that, the resources needed to support these capabilities, and how it plans to configure and use these capabilities and resources to achieve its aims (see Chapter 6). Strategy elements are used to model the strategic direction and choices of the enterprise, whereas Business Layer elements (Chapter 8) are used to model the operational organization of an enterprise.
Figure 46 gives an overview of the strategy elements and their relationships.
Figure 46: Strategy Elements Metamodel
Note: This figure does not show all permitted relationships; every element in the language can have composition, aggregation, and specialization relationships with elements of the same type. Furthermore, there are indirect relationships that can be derived, as explained in Section 5.7. The full specification of permitted relationships can be found in Appendix B.
A resource represents an asset owned or controlled by an individual or organization.
Resources are a central concept in the field of strategic management, economics, computer science, portfolio management, and more. They are often considered, together with capabilities, to be sources of competitive advantage for organizations. Resources are analyzed in terms of strengths and weaknesses, and they are considered when implementing strategies. Due to resources being limited, they can often be a deciding factor for choosing which strategy, goal, and project to implement and in which order. Resources can be classified in different ways; including tangible assets, intangible assets, and human assets. Examples of tangible assets include financial assets (cash, securities, borrowing capacity, etc.) and physical assets (plant, equipment, land, mineral reserves, etc.). Examples of intangible assets include technology assets (patents, copyrights, trade secrets, etc.), reputation assets (brand, relationships, etc.), and culture assets. Examples of human assets include skills/know-how, capacity for communication and collaboration, and motivation.
Resources are realized by active and passive structure elements and are therefore classified as structures that are neither active nor passive. The name of a resource should preferably be a noun.
Figure 47: Resource Notation
A capability represents an ability that an active structure element, such as an organization, person, or system, possesses.
In the field of business, strategic thinking and planning delivers strategies and high-level goals that are often not directly implementable in the architecture of an organization. These long-term or generic plans need to be specified and made actionable in a way that both business leaders and Enterprise Architects can relate to, and at a relatively high abstraction level.
Capabilities help to reduce this gap by focusing on business outcomes. On the one hand, they provide a high-level view of the current and desired abilities of an organization, in relation to its strategy and its environment. On the other hand, they are realized by various elements (people, processes, systems, and so on) that can be described, designed, and implemented using Enterprise Architecture approaches. Capabilities may also have serving relationships; for example, to denote that one capability contributes to another.
Capabilities are expressed in general and high-level terms and are typically realized by a combination of organization, people, processes, information, and technology. For example, marketing, customer contact, or outbound telemarketing [4].
Capabilities are typically aimed at achieving some goal or delivering value by realizing an outcome. Capabilities are themselves realized by core elements. To denote that a set of core elements together realizes a capability, grouping can be used.
Capabilities are often used for capability-based planning, to describe their evolution over time. To model such so-called capability increments, the specialization relationship can be used to denote that a certain capability increment is a specific version of that capability. Aggregating those increments and the core elements that realize them in plateaus (see Section 13.2.4) can be used to model the evolution of the capabilities.
The name of a capability should emphasize “what we do” rather than “how we do it”. Typically it should be expressed as a compound noun or gerund (-ing form of verb); e.g., “Project Management”, “Market Development”, “Product Engineering”, etc.
Figure 48: Capability Notation
A value stream represents a sequence of activities that create an overall result for a customer, stakeholder, or end user.
A value stream describes how an enterprise organizes its activities to create value. As described in the TOGAF Series Guide: Value Streams [17], a key principle of value streams is that value is always defined from the perspective of the stakeholder – the customer, end user, or recipient of the product, service, or deliverable produced by the work. The value obtained is in the eye of the beholder; it depends more on the stakeholder’s perception of the worth of the product, service, outcome, or deliverable than on its intrinsic value; i.e., the cost to produce. This is modeled in the ArchiMate language using the value element. This, in turn, is associated on the one hand with the result being produced, and on the other hand may be associated with the stakeholder.
Value streams may be defined at different levels of the organization; e.g., at the enterprise level, business unit level, or department level. Value streams can be a composition or aggregation of value-adding activities. These are also modeled with the value stream element and are known as value (stream) stages, each of which creates and adds incremental value from one stage to the next. These stages are typically related using flow relationships to model the flow of value between them. Resources can be assigned to value streams and capabilities can serve (i.e., enable) a value stream.
Importantly, value streams and business processes may seem alike, but they are defined at different abstraction levels and serve separate purposes. A business process describes the (time-ordered) sequence of behaviors required to create some result for an individual case, and it may describe alternative paths and decision points (modeled with junctions). In contrast, a value stream focuses on the overall value-creating behavior from the perspective of the importance, worth, or usefulness of what is produced, and is not a description of time-ordered tasks for individual cases. Value streams (and capabilities) reflect an organization’s business model and value proposition, whereas business processes (and business functions) reflect its operating model. At their respective abstraction levels, value streams and business processes both represent the “enterprise in motion”, whereas capabilities and business functions both describe the “enterprise at rest”.
Value streams are typically realized by business processes and possibly other core behavior elements. The stages in a value stream provide a framework for organizing and defining business processes, but different parts of the organization may have their own implementations of business processes that realize the same value stream stage. Conversely, one business process may realize multiple stages in a value stream.
It is recommended that the name of a value stream be expressed using a verb-noun construct in the active tense; e.g., “Acquire Insurance Product”.
Figure 49: Value Stream Notation
A course of action represents an approach or plan for configuring some capabilities and resources of the enterprise, undertaken to achieve a goal.
A course of action represents what an enterprise has decided to do. Courses of action can be categorized as strategies and tactics. It is not possible to make a hard distinction between the two, but strategies tend to be long-term and fairly broad in scope, while tactics tend to be shorter-term and narrower in scope.
Figure 50: Course of Action Notation
“Increase Profit” is a goal that can be decomposed into a number of other goals: “Decrease Costs” and “Increase Revenue”. The former is related to the “Operational Excellence” strategy of the company, modeled as a course of action. This is decomposed into two other courses of action: “Centralize IT Systems” and “Standardize Products”. These result in two outcomes: “Decreased Costs” and “Loss of Customers”, which influence the goals in positive and negative ways. This shows an important difference between goals and outcomes: not all outcomes lead to the intended results.
The courses of action are realized by a number of capabilities: “IT Management & Operations” and “Product Management”, and appropriate resources “Human Resources” and “IT Resources” are assigned to the former. The model fragment also shows that these resources are located in the “Headquarters” of the organization, in line with the “Centralize IT Systems” course of action.
Example 21: Capability, Resource, and Course of Action
Example 22 shows a model of a high-level value stream for an insurance company, where each stage in the value stream is served by a number of capabilities. Between these stages, we see the value flows with associated value items, and at the end the business outcome that this value stream realizes for a particular stakeholder.
Example 22: Value Stream with Capability Cross-Mapping
Table 5 gives an overview of the strategy elements, with their definitions.
Table 5: Strategy Elements
|
Element |
Description |
Notation |
|
Resource |
Represents an asset owned or controlled by an individual or organization. |
|
|
Capability |
Represents an ability that an active structure element, such as an organization, person, or system, possesses. |
|
|
Value stream |
Represents a sequence of activities that create an overall result for a customer, stakeholder, or end user. |
|
|
Course of action |
Represents an approach or plan for configuring some capabilities and resources of the enterprise, undertaken to achieve a goal. |
|
Figure 51 shows how the strategy elements are related to core elements and motivation elements. Internal and external behavior elements may realize strategy behavior elements (value streams and capabilities), while an active or passive structure element may realize a resource. Capabilities, value streams, courses of action, and resources may realize or influence requirements (and indirectly, as described in Section 5.7, also principles or goals), and a course of action may also realize or influence an outcome (and, indirectly, also a goal).
Figure 51: Relationships Between Strategy Elements and Motivation and Core Elements
Downloads of the ArchiMate documentation are available under license from the Download link within the ArchiMate information web site. The license is free to any organization wishing to use ArchiMate documentation entirely for internal purposes. A book is also available from The Open Group Library as document C197.
