A capability based approach to enterprise transformation

The paper is about the drastic transformation of the strategy and business model of the Russian information technological enterprise which incorporates autonomous but interrelated business units: in 2001 top management of the IBS Company made the decision to switch to the information technology services and consulting area. The creation of new capabilities was the transformation objective. Capability based approach was successfully applied to achieve the transformation goals. An “ES/SoS nuclear model” has been introduced to describe the transformation. The model represents the enterprise as the “hard business nucleus” or kernel (major business-agents, who really make the business), a “soft business shell” (non-material environment: governing media, competences, knowledge, etc. - intangible assets), and the “cloud of extended enterprise” (clients, partners, etc., interlinked by common “across”-business processes). The great majority of transformation activities and outcomes lie in the ES/SoS's “soft shell” which includes new capabilities, governing relations, competences, etc.