Anderson MacGyver's MultiModal Business Activity Model

Effectively designing the IT operating model and technology governance is one of the key success factors for any digital transformation strategy. But how do you get started? Meet AndersonMacGyver’s ‘MultiModal Business Activity Model’ – an academically validated framework that guides the optimal design of technology practices.

With digital technologies now centre stage in any organisation strategy, major investments are flowing into the transformation of IT functions. The downside, however, is that digital transformation is notorious for its pitfalls, with one study of 900 cases worldwide suggesting that only 30% can be deemed (somewhat) successful.

At Anderson MacGyver, a strategic IT consultancy with offices in the Netherlands, Germany and Sweden, they know that all too well. The firm has been advising CIOs and senior management on technology since 2013, including on how digital can be embedded into all parts of an organisation – with an empowering governance at its outset.

Back in 2014 this led to the birth of the ‘MultiModal Business Activity Model’, first developed when a client asked the firm to review its application portfolio. “We looked for a way to link the applications portfolio to the business objectives. We did not find a clear framework for this in practice and in literature, and decided to develop our own,” recalled Albert Sprokholt, a principal at Anderson MacGyver with previous CIO experience.

Sprokholt co-developed the model with Fabian Haijenga and Anderson MacGyver co-founder Gerard Wijers. They ensured that the model is grounded within academic research. Sprokholt gives guest lectures at the University of Utrecht, while Wijers still serves as a part-time professor at Nyenrode Business University and a Senior Research Fellow at Delft University of Technology.

“Our model is one of the few frameworks by consultancies that builds on an academic footing,” said Wijers and Sprokholt, who both held partner-level roles at leading sourcing consultancies in the market prior to joining Anderson MacGyver.

Fast forward eight years since its inception, and the model has grown into the cornerstone of any engagement Anderson MacGyver delivers. Wijers: “We use the model – in one form or another – in practically all our assignments to gain an unambiguous understanding of the strategic importance of business activities and the way with which they are impacted by changes in the environment.”

“That makes it a powerful instrument for assessing investment decisions around digital transformation,” added Sprokholt.

“Multimodality provides an excellent starting point for digital transformation and alignment between business, tech and data.”

About the MultiModal Business Activity Model

Central in the model are business activities. “There are a couple of reasons for this, says Sprokholt.

“First, activities are easy to understand: an activity is about what one does and the result, without the details of how it is done. Second, business activities are a fundamental part of Porter’s strategic thinking. Next to that, business activities are used more often as a theoretical building block, for example in the Business Model Canvas and recent literature.”

The model hinges on two dimensions that distinguish between business activities on a few important characteristics for digital transformation and strategy development. The first dimension is Dynamics – this spans the strategic choice an organisation makes on how to deal with the impact of external changes in the environment on a business activity.

The second is Differentiation – this spectrum plots the degree to which business activities are distinctive or specific.

Activities are then plotted into the 2x2 quadrant with four different types of business activities possible. These are called ‘modalities’. The classification of business activities can support decision-making regarding technological and organizational aspects of these activities, from the selection of a technological solution to the need to source activities or the formations of teams.

Distinct activities (purple) are business activities that are specific and highly responsive to change. They are business activities that play a central role in the development of new and innovative products and services in response to changing customer demands or in response to developments in society, technology, or the actions of competitors.

Example: developing sustainable, innovative alternatives for existing services and products, or products and services tailored to the wishes of customers.

Specialized activities (orange) are activities that take place in a relatively stable environment and are specific because they require special knowledge, resources, methods. Specialized activities distinguish themselves in finding specific and often complicated solutions or results by applying specific knowledge, expertise and resources to more or less defined problems.

Think of technical maintenance of complex infrastructure, time-critical processes, integration issues, specialist work in hospitals or organizations charged with the implementation of specific legislation, such as the tax authorities.

Common activities (green) are business activities that are characterized by a relatively stable environment and that are no different from comparable activities at other organizations. Common activities are usually designed to provide good and reliable products, services or results with a good price/performance.

Common activities are relatively stable over time and are performed (similarly) by the majority of organizations. Examples of common activities are support activities such as administration, purchasing, and primary activities of companies that provide products and services that compete on price with comparable products of competitors.

Adaptive activities (blue) are business activities that have relatively high dynamics, but that do not differ in specific features from comparable activities, products or services of other organizations. Adaptive activities are often adapted in response to changing customer demands or developments in society or technology.

The activities are dynamic in time. Examples of adaptive activities are commercial and support activities that need to be continuously adapted to the actions of competitors or as a result of rapidly changing environmental conditions, such as the use of new technologies or changing consumer preferences in the world of fashion, entertainment or social media.

The outcome

The main outcome of the ‘MultiModal Business Activity Model’ is that it provides a practical and simple tool to analyse the business activities of organisations and their use of data and IT, paving the way for a roadmap and action planning for digital transformation.

“The modality of the business activity supports decision-making on many aspects related to technology and data,” explained Lotte Nieuwmeijer, who has over the past two years played a driving role in the model’s further development.

“The list of possible use cases for multimodality is long. Some examples – insights can help decide which kind of technological and data solutions are needed to support activities, help high-performing teams frame their tech activities, or shed light on organizing collaboration with third party partners.”

Just as important – digital transformation culminates into people-driven change in the end – is that the model is an “excellent tool for conducting conversations and stakeholder alignment”, said Sprokholt. “The model aligns stakeholder perspectives across levels and helps to jointly understand and determine the future strategic direction of business activities.”

Wijers concluded: “It is a conversational tool that creates a shared language, it focuses on the why and what needs to change in a business activity or group of activities amongst a group of stakeholders in order to realise the objectives of any business strategy.”

For more information on the model: Download Anderson MacGyver's ‘MultiModal Business Activity Model’ white paper.