Over the past two weeks, I've shared why capability assessment drives strategic execution success and the two-layer framework I use with clients to evaluate organizational and business model capabilities.
This week's question: When should you actually conduct these assessments?
Capability assessment works best when it's systematic, not sporadic. Here are the four decision points where I guide clients through capability evaluation—and why each one matters.
Strategic Planning Season: Setting Yourself Up for Success
Annual planning offers the natural starting point for capability assessment. This is when you're defining strategic direction and can still adjust plans based on what you discover.
Before finalizing your strategic initiatives, assess both capability layers systematically:
For organizational capabilities: Does this strategy assume we have strong decision-making and follow-through? Can we demonstrate that capability through recent examples? If our strategy requires quick market adaptation, do we have evidence we can spot changes early and respond effectively?
For business model capabilities: What competitive advantages will this strategy require? If we're planning digital transformation, do we have the technology skills and change management capabilities inside the organization? If not, capability building needs to go directly on our strategic projects roadmap.
The key insight: Assess capabilities to ensure your strategy can actually work, not to validate a strategy you've already fallen in love with.
Major Initiative Launch: The Reality Check Before You Commit
Before launching any significant strategic project—new market entry, product launch, operational transformation—conduct focused capability assessment.
Ask these questions before committing resources:
- What critical capabilities does this initiative require for success?
- Do we currently have those capabilities, or does capability building need to be part of the initiative plan?
- Are we budgeting time and resources for capability development, or only for initiative execution?
Map capabilities first, then commit resources.
Market Shift Response: When Change Demands Strategic Adaptation
Market disruptions don't wait for your planning cycle. Supply chain crises, competitive threats, technology shifts, or economic changes require immediate capability reassessment.
When market conditions change dramatically, ask:
- Do our current capabilities still align with new market realities?
- What capabilities does our adapted strategy now require?
- Can we build needed capabilities quickly enough, or do we need to adjust our strategic response?
During the pandemic supply crisis, companies with strong customer value creation capabilities actually strengthened their market position. They had the organizational foundation—the relationships, problem-solving approaches, and delivery coordination—to become more valuable when alternatives were scarce.
Their competitors had similar market opportunities but lacked the capability foundation to capitalize on them.
The companies that show the most resilience during disruption can rapidly assess existing capabilities and adapt their strategy to match organizational reality.
Quarterly Planning Reviews: Building Capabilities Through the Year
Quarterly strategy reviews offer regular opportunities to assess whether capability gaps are limiting your progress.
Rather than waiting for annual planning, build capability assessment into your quarterly rhythm:
Capability Progress Review: For each strategic initiative, evaluate whether you're building the capabilities needed for success. Are capability development milestones being met alongside execution milestones?
Emerging Gap Identification: Are new capability needs emerging as your strategy unfolds? Market conditions change, strategic priorities shift—quarterly reviews let you identify capability implications in real-time.
Resource Reallocation: Should you shift resources toward capability building for higher-priority initiatives? Quarterly reviews create the space to make these adjustments before gaps become crises.
During a quarterly strategic planning review, one operations leader I worked with realized their operational excellence initiatives really needed dedicated continuous improvement expertise. They hired a Continuous Improvement Manager before launching the initiatives. The hire paid off beyond expectations—bringing capabilities that enabled capacity planning projects they hadn't originally planned.
By making capability development part of your strategic conversation every quarter, not just during annual planning, you make the process systematic which greatly enhances your ability to execute bold strategies.
Making This Systematic: Your Implementation Plan
Here's how you can make this systematic:
During Strategic Planning: Before finalizing initiatives, map required capabilities and assess current strength using specific examples. Build capability development into strategic timelines.
Before Major Initiatives: Require capability assessment alongside financial projections. No major resource commitment without honest evaluation of organizational readiness.
When Markets Shift: Assess capability implications before adjusting strategy. Understand what your organization can actually deliver in new conditions.
Every Quarter: Include capability development discussions in strategic reviews. Track capability building progress alongside traditional performance metrics.
The framework stays consistent—organizational capabilities (your foundation) and business model capabilities (your competitive edge). What changes is when and how systematically you assess them.
Ready to apply this to your organization? I've created a Strategic Capability Assessment Worksheet that walks you through evaluating both capability types for your current strategic initiatives.
Get the worksheet and start identifying capability gaps before they become strategic obstacles. Reply to this post or contact me directly and I'll send it right over.
Or if you'd like to discuss how to apply this framework to your specific strategic situation, let's talk. I'd be happy to walk through how systematic capability assessment could strengthen your strategic execution.
work well,
adriana