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The Principles of Designing a Target Operating Model

Richard Keenlyside - Blog about The Principles of Designing a Target Operating Model




TOM Design Principles

This blog discusses the basic principles regarding developing a Target Operating Model (TOM).


The time it takes to develop a target operating model for an organisation depends on a range of factors, including the size and complexity of the organisation and the number of existing systems and processes in place.


The process typically begins with a comprehensive assessment of existing operations, followed by identifying areas of opportunity and improvement.


Depending on the complexity of the problem, the development of a model may involve various stakeholders, such as senior management and IT teams, and can take anywhere from weeks to months.


Ultimately, for the target operating model to be successful, it is essential to ensure that all parties involved provide support and buy-in. This includes ensuring clear and measurable objectives are in place, stakeholders understand the purpose and expected outcomes, and the model rollout process includes regular communication updates between teams.


To get started, you'll want to define what success looks like for your organisation and create measurable goals that will help guide your progress.


Then, you can assess current operations, develop a timeline, and estimate costs associated with reaching the target.


Lastly, track progress against each milestone, measuring results to ensure success. With this approach in hand, you're ready to begin transforming your organisation into the successful vision you've set out!


10 Steps you should consider.

  1. Create a comprehensive roadmap of your organisation’s key objectives, goals, and strategies. This should include both short-term and long-term goals.

  2. Develop a process for measuring success and failure. This can include measurable metrics such as ROI, customer satisfaction, and operational efficiency.

  3. Establish key performance indicators (KPIs) that track your team's effectiveness and help identify potential areas for improvement.

  4. Utilise analytics tools to improve decision-making and uncover new growth opportunities.

  5. Employ Agile methodologies to ensure continuous development and that all stakeholders are on the same page.

  6. Establish internal best practices across departments to ensure consistency.

  7. Take advantage of automation tools to reduce manual tasks and streamline processes.

  8. Review existing models and identify opportunities for improvement and optimisation.

  9. Engage stakeholders and customers by incorporating their feedback into your models.

  10. Take advantage of cloud solutions to reduce costs, increase flexibility, and enable scalability.

In Summary

To summarise, target operating models are complex, and they take time to get right. The TOM is a key element for any business to be successful.

  • Involve all business areas.

  • Ensure clear and measurable objectives.

  • Regular communication is crucial.

  • Be clear about what success looks like


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