Target Operating Model Design
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As experts at helping organizations evaluate their current operations and create a Target Operating Model, Appnovation offers a systematic, tailored approach to help your organization achieve its strategic operating targets.
Moving to a new way of operating, especially for an enterprise level entity, can be a daunting task to say the least. As experts at helping organizations evaluate their current operations and create a Target Operating Model, Appnovation offers a systematic, yet tailored approach to support your organization to achieve its strategic operating targets.
We are committed to helping clients with a variety of initiatives, from transforming their current operating models (COMs) to designing completely new Target Operating Models in response to various business scenarios, confirming that the vital components of the business are in sync with the strategy.
Having rich experience across a variety of industries enables Appnovation to provide sector specific operations recommendations for Target Operating Model creation, but also allows us to leverage best practices from other businesses that may add additional value.
The way an organization is configured and operating today is the known as the Current Operating Model (COM) whereas the what the organization should be move to in terms of the way it should be configured and operating, ie. the future state, to achieve its strategy is considered the Target Operating Model (TOM).
Hence the main objective of the Target Operating Model is to assist in providing a blueprint for the application of a corporate strategy to a business operation.
At a very high level, the TOM serves as a reference to show the perceived “ideal state” as to how best the business can be organized to achieve maximum efficiency and performance and therefore be in the best possible position to execute the entity’s vision, strategy and objectives.
The Target Operating Model also serves to provide understanding where, functions, information people, process, resources and technology come together as well as visually displaying different viewpoints of important elements, related to providing value, when it comes to business activities. Furthermore, the TOM includes what key factors are critical to ensure organizational success.
Strategy drivers can help dictate the appropriate audience for the TOM which can include a variety of groups and disciplines such as executives, strategy owners, operations employees, IT staff, marketing teams, human resources, project managers and/or risk personnel.
Why Design a Target Operating Model
Trouble expressing the future state – poorly or undefined operational or customer and practices and interactions (siloed products/region specific or centric solutions) hinder efficiency and production, resulting in loss of talent.
Lack of strong or clear business strategy – essentially the common response to why you are doing something is “we have always done it like that…”- which is an unclear strategy at best and any goals make it very difficult to link the strategy with actionable changes to any operating model that is in place.
Complex IT systems architecture – poor understanding on how to implement and integrate new IT applications alongside or with legacy platforms impede, even obstruct, flexible deployment of new services and/or product.
Opposing priorities and opposition from middle management – when priorities compete or even oppose each other coupled with limited means and resistance to new ways of thinking and doing things undermine the organization’s ability to motivate innovation and push forward “what we do” as a company.
As Target Operating Model creation and consulting experts, Appnovation offers a systematic, yet tailored approach to support your organization to achieve its strategic operating targets.
We continue to help clients on a variety of initiatives, from transforming their current operating models (COMs) to designing completely new Target Operating Models, in response to various business scenarios, confirming that the vital components of the business are in sync with the strategy.
Appnovation uses our proven framework and consultative expertise for successfully designing and developing TOMs that we adapt to meet your specific requirements. Our approach employs our industry experience, best practices and design principles to back the improving and enhancing of operating models.
We drive an iterative and collaborative methodology with our clients that include personnel interviews, working sessions with subject matter experts and, “blue sky” and “deep dive” workshops to uncover and explore ideas, address problems and blockers, adjust controls, redefine functions and roles and plan for impending changes.
Factors that can affect the process and the delivery of the TOM include the scope of the organization included, its complexity, stakeholder and key personnel involvement and availability.
- Current state review and analysis of existing/current organizational operating model(s) adequately capturing dependencies, processes, people, technologies etc.
- Evaluation of the strategy and principles that will serve as guidelines for direction of the project’s scope
- Design and development of the TOM that includes methodology, explanations, definitions functions, process architecture, structure, high level job roles, etc. and accounts for varying scenarios and options implications for things like IT, organizational, governance choices by providing reliable recommendations and financial benefits
- Formation of a issue, risk and opportunity matrix along with a gap analysis between the current state and the TOM
- Identify and development of a cost breakdown, communication plan, transition road map and resourcing requirements to initiate and roll out the change program
High Level Steps
Our teams take a four-step approach:
Assess & Capture As-Is
Articulate, define and refine the strategy and the vision, diagnose the current operating model and its effectiveness while outlining the gaps in the various capabilities to reach the TOM.
Design & Justify
First create the designing principles about how the operating model will be developed and set the KPIs for success; next, define how the organization will operate and identify the capabilities it will require that are in line with the strategic direction along the following aspects which include customers, services and/or products, channels, processes, IT platforms, systems and applications, organizational structure, employees and locations.
Build & Test
Create and refine business case to highlight and quantify changes in terms of costs, benefits (financial and otherwise) potential risks, roadmap for implementation, employee headcount requirements, organizational makeup and structure, job roles and skills.
Roll Out & Implement
The methodology should include a transformative roadmap defining timelines, roles, actions, requirements and resources and communication plan to implement TOM, develop and monitor company dashboard of KPIs to help stakeholders and management with refining the new operational environment.
Target Operating Model Business Benefits
Our Target Operating Models provide a holistic transformational approach that leads to an alignment and optimal configuration of technology and business vision and strategy tailored in all aspects to meet future requirements and best fit, accounting for market changes and the organization's strategic outlook.
The benefits of a company having a Target Operating Model include:
- Issues and opportunities identification for improvement and optimization
- Stakeholder approved future vision of the optimal organization design aligned to business objectives and company strategy
- Clear lines can be drawn between roles, functions, processes, technologies, etc.
- Definitions of the roles, skill sets and staffing required to achieve.
- Effective planning, implementation roadmap, dashboard of KPIs, knowledge transfer and change management to deliver expected outcomes and refine the model.
- Financial implications for each option / scenario to better enable management of direction and decisions, with specificity to your unique organization.
- Assurance that processes are optimal, designed and tested to deliver objectives while also aligning to strategic and operational objectives.
Shopping quotes for your next target operating model (TOM) project? We offer competitive rates for our corporate agility experts and consultants and quote aggressively on projects.
Our Target Operating Model consultants can deliver a transformational approach to align technology and business vision and strategy tailored in all aspects to meet your organization's strategic outlook. Appnovation offers a systematic, agile approach, which we can design and develop to help your organization achieve its strategic operating targets
If you’re looking to become more efficient and organized as a company, we’re the experts you want to talk to. Your maximum success is our minimum requirement. Complete the form, email us at firstname.lastname@example.org or contact us directly by phone at one of our many global office locations to talk about your next or an upcoming project.