=Paper=
{{Paper
|id=Vol-2835/paper1
|storemode=property
|title=Value Aspects of Wardley Maps
|pdfUrl=https://ceur-ws.org/Vol-2835/paper1.pdf
|volume=Vol-2835
|authors=Pavel Hruby,Jesper Kiehn
|dblpUrl=https://dblp.org/rec/conf/vmbo/HrubyK21
}}
==Value Aspects of Wardley Maps==
https://ceur-ws.org/Vol-2835/paper1.pdf
Value Aspects of Wardley Maps
Pavel Hruby, Jesper Kiehn
phruby@acm.org, jkiehn@hotmail.com
Abstract. Wardley map is a business strategy method named after Simon Wardley,
who created this method in the period 2005-2010 and gradually improved it into its
current form. Wardley map determines the business landscape containing a value
chain, where the position of each component is determined by two criteria: by the
level of the component’s evolution, and by its visibility to the user. As the
components of the Wardley map form a value-adding process, in this short paper the
authors would like to explore the hypothesis how does Wardley map match the REA
ontology, and whether using them together could lead to additional insights about the
business and to a more complete business model.
Keywords: Wardley map, REA ontology, Value chain, Value-adding process, User
need.
1 Introduction
A Wardley map [7] is a map of the structure of a business or service. Wardley map
specifies the needs of company stakeholders such as customer, user, government and
regulatory agencies, and the components needed to serve these stakeholders. Besides
the value chain, a Wardley map modeling framework contains concepts such as
company purpose, doctrine, user journey, climate (the rules of the game), leadership
(the moves we can make) and specific patterns in each area.
Compared to traditional techniques such as a business plan or SWOT diagram [9]
(strengths, weaknesses, opportunities and threats), Wardley map does not describe a
static strategy or a snapshot in time, but rather a space in which the strategy can
evolve. In the military metaphor, a well-known statement in military strategy is that
“no plan survives contact with the enemy”, attributed to the Prussian field marshal
Graf Helmuth Karl Bernhard von Moltke [8]. But in order to make the right decisions,
the military commander has a map of the battlefield. In business strategy, instead of a
(often rather wishful than realistic) business plan, Wardley map is a map of the
customer needs, products and services, and their environment. Consequently, Wardley
map allows for using “topographical intelligence” in creating the business strategy
and modifying it to adapt to external forces.
It has been reported by Leading Edge Forum [4] that Wardley maps helped the
companies to modify their business strategy when the COVID lockdowns started in
the first quarter of 2020, and that these companies adapted to COVID-related
constraints better than the companies without a map.
2 Wardley Map
Central element of the Wardley map modeling framework is a value chain, illustrated
in Fig 1. The value chain can be used to derive other elements of Wardley Mapping
framework, such as customer journey, doctrine, and company purpose.
Fig. 1. Example of value chain in Wadley Maps.
Source: https://medium.com/wardleymaps/finding-a-path-cdb1249078c0
Wardley map in Fig. 1 can be read as follows. Like a topographical map is oriented
towards the North at the top, Wardley map is oriented towards the Customer, user, or
other stakeholder at the top. Below the customer are the customer needs that the
company tries to meet: Online image manipulation, Online photo storage, Print and
Web site. Below are the components that are required to meet these needs and are
under company control: CRM, Platform, Computer, Data Center and Electric Power.
The position of components in the y-axis illustrates visibility to the user, the
components lower down the map are less visible to the user. Position of the
components in the x-axis represents the stage of evolution of the component, from the
genesis phase, i.e. the rare newly discovered components, to the commodities on the
right hand of the spectrum, i.e. highly standardized products and utilities that fit
specific purposes.
The evolution dimension (the x-axis) determines additional characteristics of these
components, also described in Chapter 2 of Wardley Maps [7]. For example, users’
tolerance to failure depends on the component evolution stage. For the components in
the genesis stage failure is assumed, for the components in the product stage failure is
not tolerated and failure of the commodities is surprising.
The evolution stage of the component also determines the optimal organizational
structure. Wardley maps divide people into three groups, based on their mindsets and
skills: Pioneers (they like experimenting), Settlers (can turn a prototype into a
product) and Town Planners (understand the economies of scale): Pioneers best
contribute to the components in the Genesis phase, Settlers to the Custom build and
product phases, while Town Planners best work with commodities.
The evolution stage also determines the methodological approach for development of
these components: Agile methods (embracing change) fit best to the components in
the Genesis phase, Lean (focusing on improving value and reducing waste) fits to
Custom Build and Product phase, while 6-sigma (data driven, reducing deviations) is
best applicable to commodities, where stability, efficiency and price are most
important. In Wardley maps it would be a mistake to form a team that is responsible
for the components in different stages of evolution, as they require different
approaches and people with very different mindsets.
Fig. 2. Interpretation of components in Wardley Maps.
Source: https://learnwardleymapping.com/
Semantics of the components on Wardley Map is not formally specified. Simon
Wardley writes the components represent activities, practices, data and knowledge,
other authors, such as Ben Mosior [6] calls them capabilities. The relationship
between components is informally characterized by the “needs” relationship;
components more visible to the customer need the components lower in the y-axis.
For example, in Fig. 1, Website needs CRM, which needs Compute capability, which
needs Data Centre and Electric Power.
3 Mapping Wardley Map to the REA Ontology
In authors’ current understanding, Wardley Map only describes conversion processes,
and does not describe exchange processes. Although many existing Wardley Maps
include Payment capability, this capability is understood as service allowing the
customer to pay for the provided services. Likewise, Wardley maps for a financial
institution include needs of financial flows, but the focus of the map will be on
components enabling these financial flows, rather than monitoring what has been
exchanged for what. Nevertheless, Wardley map distinguishes between users and
customers, that is, the company provides products and services to the users, but often
a different stakeholder, the customer, pays for these products and services.
Suggested mapping between the REA concepts and Wardley map is illustrated in
Table 1.
Table 1. Correspondence between Wardley map and the REA ontology concepts
Wardley maps The REA ontology
User, Customer, Stakeholder Economic agent
Need relationship REA conversion process
User need Economic resource
Capability, activity, practice, data, knowledge Economic resource
Business purpose Not applicable
Partly, only as a value chain. Evolution stage of
Landscape (a Wardley Map) the economic resource and visibility to the user
are not applicable.
Doctrine (things we should always do) Not applicable
Climate (external forces) Not applicable
Leadership (moves we can make) Not applicable
User, customer, and other stakeholders at the top of Wardley map correspond to the
economic agents in the REA ontology. The need relationship in Wardley map can be
described by the REA conversion process, where the elements at the lower end of the
relationship are the economic resources used or consumed in order to produce the
economic resource at the higher end of the relationship. We can also see that the
Enterprise provides the Compute capability in order to receive CRM, see Fig 3.
«economic resource»
CRM
«produce»
«economic event»
«receive» «economic agent»
Use Compute
«need» «provide» Enterprise
Resource
«use»
«economic resource»
Compute
Fig. 3. Need relationship (left) and corresponding REA model (right)
Biccheri and Ferrario [1] provide a comprehensive analysis of needs and realized that
“the meaning of the word need is ambiguous and full of antinomic nuances.”
Nevertheless, this notion of need corresponds very well to the Wardley map need
relationship, forming the supply chain of services in Wardley map. Consequently, the
need-driven representation of services for the Public Administration can also be
described by a Wardley Map, although without underlying nuances of various type of
needs, as Wardley Maps only have a single type of the need relationship.
De Kinderen et al. [3] observe that “in many situations a customer need is so complex
that a bundle of services is needed to satisfy the need”, and also distinguishes between
what users need and what they want; the need defines the essential survival set of
consequences of consuming a service, while a want can contain non-essentials”. The
term consequence is specified as “anything that results from consuming a service”.
Wardley maps typically do not specify the user need in De Kinderen’s [3] sense,
instead, they specify a bundle of services satisfying the implicit user need. In
practically all published Wardley maps, such as Wardley [7] and Mosior [6], the
components linked to the User are products or services. For example, in Fig. 1, the
components linked to the User are Online Image Manipulation, Online Photo Storage,
Web Site and Print. These components represent a “bundle of services needed to
satisfy the need”, but the user need itself, which in this case is turning the camera
image (the raw pixels) into a good-looking picture, is not represented in Wardley map
explicitly. Mosior [5] suggests several ways how to include user needs to Wardley
maps, by annotating the relationship, by user journey, as knowledge we have about
the user, and as user’s capability. For the purposes of mapping Wardley maps to the
REA ontology, we can conclude that components of the Wardley map, i.e. capability,
activity, practice, data and knowledge, represent REA economic resources.
Business purpose in Wardley map represents the main user need that the company is
meeting. Examples are "Designed for Driving Pleasure” by BMW and "Advancement
Through Technology” by Audi. The business purpose inspires people to act, and the
underlying value chain may be different if we focus on driving pleasure, or on
advancement through technology. Business purpose is probably not applicable to the
REA ontology. Likewise, Doctrine, Climate, and Leadership do not have a
corresponding element in the REA ontology.
4 Discussion
Users are at the top of a Wardley Map. The components linked to the User are called
“user needs”, however, these components often represent products or services, and the
actual user needs are implied. It brings focus of the map to the user and to
substitutions of the services and products, essential in understanding and adapting
business strategy. For example, cable TV can be substituted by streaming TV
services, while the user need, the home entertainment, is implied.
The value chain described using a Wardley Map can be described by sequences of
conversion processes in the REA ontology. Applying the axioms and consistency
rules of the REA ontology will lead to the discovery of additional components in the
value chain, and consequently to better understanding of the business landscape. The
REA axioms will also help creating of Wardley map consistent from the economic
point of view, not only relying on the business instinct and experience of the map
creator.
A typical Wardley map is drawn from the perspective of a single company, i.e. from
the “trading partner” perspective. The REA ontology can provide a model from the
perspective of an independent observer, thus modeling a business ecosystem of
customers, vendors, partners, and competitors. There might be a potential benefit for
Wardley map to produce maps for business ecosystems, for example, when the
customer has several needs that must be met simultaneously, and they are met by
different companies.
As creating the REA model from Wardley map is straightforward and could be easily
automated, the resulting REA model can be used as a system specification of a
software application for planning, monitoring, and control of the business processes
described by the Wardley map. As there are published Wardley maps both for various
business scenarios, company processes and even industries, they can serve as
templates for the REA models for these business scenarios, company processes and
industries.
5 References
1. Biccheri, L., & Ferrario, R. (2019). An analysis of the notion of need for the representation
of public services. The Joint Ontology Workshops, Proceedings of the Joint Ontology
Workshops 2019, Episode 5: The Styrian Autumn of Ontology, Graz, Austria, September
23-25, 2019, volume 2518. CEUR WOrkshop Proceedings, 2019
2. Geerts, G., L., and McCarthy, W., E. (2000). The Ontological Foundations of REA
Enterprise Information Systems. Annual Meeting of the American Accounting Association,
Philadelphia, PA. https://msu.edu/user/mccarth4/Alabama.doc
3. De Kinderen, S., De Leenheer, P., Gordijn, J., Akkermans, H., Dröes, R. M., & Meiland, F.
(2013). e 3service: An ontology for needs-driven real-world service bundling in a multi-
supplier setting. Applied Ontology, 8(4), 195-229.
4. Leading Edge Forum, 2020, https://leadingedgeforum.com/, retrieved 23 January 2021.
5. Mosior, B: 5 Ways to Represent User Needs on a Wardley Map (2021),
https://learnwardleymapping.com/2021/01/12/5-ways-to-represent-user-needs-on-a-
wardley-map/
6. Mosior, B: Learn Wardley Mapping: https://learnwardleymapping.com/, retrieved 23
January 2021.
7. Wardley, S.: Wardley Maps: Topographical Intelligence in Business, Medium 2016,
https://medium.com/wardleymaps/finding-a-path-cdb1249078c0, retrieved 23 January
2021.
8. Wikipedia, Helmuth von Moltke the Elder (retrieved 2021),
https://en.wikipedia.org/wiki/Helmuth_von_Moltke_the_Elder
9. SWOT Analysis: https://en.wikipedia.org/wiki/SWOT_analysis, retrieved 23 January 2021.
Acknowledgement
Authors would like to thank the reviewer Iván S. Razo-Zapata of Vrije Universiteit
Amsterdam for valuable feedback and for the references to publications on
ontological analysis of needs and on related topics.