Wardley Mapping Glossary

In the context of Wardley Mapping, "Bias" refers to the tendency to become entrenched in outdated perspectives or solutions, failing to recognise that the situation has changed and more efficient alternatives have emerged. This bias can lead to a lack of adaptability, resulting in the continued use of sub-optimal approaches even when better options are available.

In the context of Wardley Mapping, "Capital" refers to any asset, resource, or advantage that an organisation can leverage to create value or gain a competitive edge. Capital can take many forms, both tangible and intangible, and can be utilised to influence the business landscape in various ways. 1

In the context of Wardley Mapping, "Centralisation" refers to a trend where one company or entity gains a dominant market position and acquires or out competes its rivals in a particular niche or industry. This concentration of assets and power often results in a monopolistic or oligopolistic market structure.

In Wardley Mapping, the term "Climate" refers to the overarching rules, patterns, and forces that govern and shape the business landscape. The Climate encompasses the external factors, market dynamics, and competitive actions that organisations must navigate and adapt to in order to succeed. 1

In the context of Wardley Mapping, "Situational Awareness" refers to the ability to perceive and comprehend the current state of the business landscape, including its dynamics, trends, and potential future trajectories. Maintaining situational awareness is essential for organisations to make informed strategic decisions and adapt to changing market conditions.

The concept of commodification illustrates how value can emerge from unexpected places. The Agile Manifesto was created to promote a collaborative, people-centric approach to software development. As Agile methodologies gained popularity, a market emerged for Scrum certifications, introducing a commercial element to the originally non-profit movement. Commodification can transform the essence of something, shifting its focus from principles to profit, while also creating new business opportunities.

A component is a single entity within a Wardley map, representing a fragment of the surrounding reality that is treated as a cohesive unit for the purpose of analysis. Components can be tangible physical objects or intangible concepts. Identifying the right components is crucial for mapping, as they form the building blocks of the value chain. The boundaries of components are somewhat arbitrary, defined by the mapper to suit the needs of the analysis.

Creative destruction is a process where an invention or innovation drastically changes the value chain, often disrupting established industries. This can be seen in the transition from newspaper ad sales to digital advertising platforms, where the value is still created but in a fundamentally different way.

Decentralisation is a trend that runs counter to centralisation. However, it is important to note that the decentralisation of a market, where one provider is replaced by many small companies, rarely happens. Transitions between evolution phases are often the best time to look for such decentralisation. Additionally, the decentralisation of assets is sometimes used as a buzzword to emphasise that not all assets are directly controlled by the power holder. This can be seen as a form of decentralisation, but it does not necessarily mean that power has been truly decentralised.

Each Wardley map has three distinct domains. The Uncharted Domain features high production costs, significant uncertainty, but potentially vast future opportunities. The Transitional Domain sees declining uncertainty and increasing volumes, leading to the highest profitability. The Industrialised Domain has high certainty, predictability, and volume, but low production costs and unit margins. These domains exhibit different patterns of economic competition and value creation.

The environment in which an organisation operates is constantly evolving, presenting both challenges and opportunities. Understanding the broader context and anticipating how it may change is crucial for strategic decision- making and ensuring long-term success. Factors such as technological advancements, shifting customer preferences, regulatory changes, and broader economic trends can significantly impact an organisation's landscape. Staying attuned to these environmental shifts allows businesses to adapt and thrive amidst the dynamic landscape.

Risk Transfer Information Sharing The movement of risk between components, such as The transfer of knowledge, data, and insights between insurance or hedging, allows for better management of components enables informed decision-making and uncertainty. coordination. Financial Transactions The exchange of money, loans, or investments facilitates the mobilisation of capital across the value chain.

The first stage of evolution, characterised by a non-existent market, high uncertainty, and vast potential. This represents the unique, the rare, the constantly changing, and the newly discovered. The focus is on exploration and discovering new possibilities.

Industrialised domains are characterised by high certainty, predictability, and efficiency. The activities in these domains have become commonplace, with low production costs and low unit margins. Industrialization transforms previously rare or inaccessible components into widely available commodities, meeting the diverse needs of the mass market. These domains are not seen as differential but as an expected norm.

Spontaneous Nurturing Conditions Striking the Balance Adaptive Approach Innovation While innovation cannot be However, if the discipline The key is to find the right Innovation is a forced, certain disciplined becomes too rigid, it can balance between structure spontaneous act, driven by practices can create stifle innovation and and flexibility, allowing creativity and the desire to favourable conditions for it creativity, leading to a innovation to flourish within introduce new solutions. to thrive. paradox. a supportive environment.

The Jevon's effect describes a counterintuitive phenomenon where increased efficiency in the use of a resource actually leads to higher overall consumption. This often occurs during the industrialization of a component, as seen with more efficient steam engines that ended up consuming more coal. The reason is that the improved efficiency makes the resource more affordable and accessible, leading to its adoption in new applications and expanded usage across the economy. This highlights the complex dynamics at play during technological progress and the importance of considering unintended consequences.

In Wardley Mapping, the "Landscape" refers to the overall environment in which an organisation operates. It encompasses all the components, relationships, and dynamics that shape the business ecosystem. The landscape includes user needs at the top, with components arranged along the value chain. The landscape is constantly evolving as components progress through their stages of evolution, requiring continuous monitoring and strategic adaptation.

1 Visible 2 Moderately Visible 3 Less Visible The most important components, Components that provide key Supporting components, further closest to the user functionality from the user The position of components on the Wardley map represents their visibility and importance to the user. Components at the top are most visible and crucial, while those lower down provide supporting functionality. This hierarchy reflects the user's needs and the relative value of each component.

Productisation is the process of transforming a custom-built solution into a standardised, repeatable product that can be packaged and sold on the market. This involves identifying core functionalities, designing intuitive interfaces, and streamlining the delivery and support processes.

Servitization is the transformation from a traditional product-centric business model to one that focuses on providing comprehensive services and solutions. It goes beyond simply offering add-on services, and instead seeks to understand the core needs of customers and delivering value through integrated offerings. 1. Identifying the key uses and dependencies of the core product 2. Bundling the product with complementary services to address those needs 3. Delivering an integrated solution that provides greater value for the customer Servitization is not just about adding services, but about rethinking the entire business model to place the customer's needs at the center. It requires a deep understanding of the value chain and the ability to coordinate diverse capabilities to create tailored offerings.

1. Signals are indicators that provide insight into the current state and potential future of a system or environment. 2. They can come from internal sources like product usage data, or external sources like market trends and competitor actions. 3. Analysing signals helps identify emerging opportunities and threats, enabling more informed strategic decisions.

Spend Control is a mandatory process that encourages organisations to map their strategic landscape before investing significant resources. It adds a mapping step to the project execution process, requiring approval from a designated governing body before a project can proceed. 1. Mapping becomes a required activity before committing resources 2. A review board or strategic unit must approve the mapping analysis 3. This helps ensure alignment with overall organizational strategy and priorities

Situational Awareness Adaptability Alignment Competitive Edge Effective strategy requires Strategy should not be rigid. Strategy aligns the Great strategy leverages an deep understanding of the It must remain flexible to organisation's capabilities, organisation's unique environment. Continuously adapt to changing resources and actions strengths to create scanning for signals and circumstances and seize towards a shared purpose. differentiated value. It trends enables anticipating emerging opportunities. It coordinates efforts positions the firm to out how the landscape might Embracing iterative learning across the value chain to compete rivals in a evolve. is key. maximise impact. sustainable way.

Transitional domains are associated with reducing uncertainty, declining production costs, and increasing volumes - leading to the highest profitability. However, as the environment becomes more predictable, the future opportunity also declines. The act is becoming more widespread, well understood, and well-defined, signalling the industry's zenith of wealth creation. Yet, the future is looking decidedly less rosy for the industry itself.

Uncharted domain is associated with high production costs and high levels of uncertainty, but potentially very high future opportunity. Being first is not always the best option due to the burden and risks of research and development.

Infrastructure Emerges 1 In the utility phase, infrastructure like electricity grids and cloud computing platforms emerge to seamlessly deliver the required components and 2 Convenience and Accessibility services to users. Users no longer have to worry about obtaining or installing things themselves. The necessary Commoditization and Ubiquity 3 infrastructure is in place to make the component or service readily available on-demand. As the infrastructure matures, the component becomes a ubiquitous utility, like electricity or water - something that is easily accessible and taken for granted.

Visibility refers to the distance between the user and a particular component or element in the value chain. The more intermediary components there are, the less visible that component becomes to the end-user. This can impact the user's understanding and appreciation of the overall system.

Weak signals are seemingly insignificant events that, upon closer inspection, may indicate impending changes. They are based on correlation and can be easily concealed or spoiled, making them difficult to detect. However, if anticipated, these signals can provide valuable insights into larger shifts happening within an organisation or industry. Your customer starts avoiding you before a contract renewal The CEO of a company steps down due to personal reasons Your company undergoes a third reorganisation within the same year These types of events, though seemingly minor, can serve as early warning signs of more significant changes to come. Paying attention to weak signals and anticipating their implications can help organisations stay ahead of the curve and make more informed strategic decisions.

A common goal-based focus for business strategy, purpose is typically expressed in company mission and vision statements. This unifying principle can drive organizations to achieve remarkable outcomes, from winning a game to reaching for the stars.