To improve their chances of survival, enterprises need to cope with the challenges caused by today’s dynamic markets, regulations, customer demands, novel technologies, etc. The shift towards a service-oriented economy as underlined by the concept of Service-Dominant (S-D) Logic is gaining traction within the Service Science community and industry. This shift towards service-dominated business models makes it even more important for enterprises to be agile to meet the rapidly changing customer demands. This demand for agility is reinforced in the context of knowledge-based service organizations (KBSOs), for which flexible service provision is a fundamental requirement. Against this background, we argue that the capability-driven design may provide the KBSOs the required degree of flexibility. Towards this goal, we present an approach for the capability-driven design of enterprises. More precisely, our contributions are (i) the introduction of a capability-based paradigm that contributes to the design of flexible services in KBSOs, (ii) an architecture of our service design and deployment environment and (iii) a demonstration of using our approach based on a real-world use case from an organization in the utilities industry. Our results and insights are based on our work in the EU-FP7 project “Capability as a Service in Digital Enterprises” (CaaS).