Author Chris Beer, Author

Spring Cleaning your Target Operating Model

It’s that New Year feeling, isn’t it? The need to change things up, feel more on top, more in control. Organisations are no different. If they are currently undergoing a big digital transformation programme, they might feel a bit in the doldrums – what can be done to give it new impetus? Or they might be facing a new transformation programme – what can be done to ensure you’re in best place to kick it off? Your target operating model (TOM) is a good place to start.

There is a lot that can be done in the preparatory stages to ensure your TOM is fit for purpose and in the best place possible to facilitate digital change. Once underway, digital initiatives move quickly and can sometimes take unexpected turns, so your TOM needs to be able to flex quickly to adapt to these changes. Here are our five top tips to ensure your TOM is ready for the digital challenge:

  1. Revisit and review: refreshing the design principles that underpin your TOM to ensure they are aligned to the organisation’s vision and corporate strategy is a valuable exercise. They need to clearly articulate the value proposition of each organisational function. And the design principles need to be syndicated across the firm to ensure buy-in from internal stakeholders.
  2. Leverage customer insights: this can improve TOM adaptability and flexibility. First, compile consumer relevant data sets from key enterprise platforms. Then model this data to develop a range of operating scenarios that reflect different market conditions. These scenarios can then help you understand how your TOM needs to ‘flex’ over time.
  3. Use customer journeys to optimise the TOM: there are a few different ways to map customer journeys to improve your operating model. For example, identifying opportunities to break down organisational silos and create shared service functions is one. Standardising end-to-end processes that underpin customer journeys is another. As is simplifying, improving or automating processes to deliver quick wins that will achieve early momentum.
  4. Upgrade tools and methodologies: tools and processes used to build and manage the TOM is a great way to ensure it is fit for purpose. For example, you could invest in a licence for an online, cloud-enabled collaboration tools. Or you could refresh all relevant documentation and remove all out-of-date material. You could also collate documentation and data into secure, easily navigable storage portals.
  5. A robust change management capability: you can underpin TOM refresh activities with a sound approach to change management. It will help you communicate the benefits of a dynamic, well-maintained TOM to different stakeholders (both inside and outside the firm). Change management can also optimise the implementation of the design options and enable faster responses to changing market conditions. It will also help your team to identify and quickly respond to any implementation issues or challenges.

There is no secret recipe for successful digital transformation. It depends on multiple factors. But an effective TOM plays an integral role – it’s been proven to result in shorter time to market cycles due to greater agility in launching new products or services. It enables teams to ramp up volume quickly at minimal cost. And you’ll see an uplift in client satisfaction due to a more transparent TOM that works with and for stakeholders across the organisation. Taking a good look under the bonnet and seeing what you can do to optimise your TOM will definitely be time well spent.

To find out how we can help your business with your digital transformation ambition, please get in touch today.

Author Chris Beer, Author

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