Ghosts of TOMs past, present and future

The world is evolving, business is evolving, consulting is evolving. This will never stop. So those organizations that don’t constantly adapt will wither and die. Target operating model (TOM) design and implementation has always been at the heart of transformation, but the approaches and methods have advanced and will continue to develop. Peeking into the past, present and future, James Cooper discusses why.

The past…

The concept of TOM design and implementation is not a new one, but the methods employed to define them have changed dramatically. Traditional approaches used simple frameworks built around people, process and technology, with acronyms like SIPOC, POLISM and ITIL giving an air of respectability to what were quite blunt instruments.

In a world where the product was king and everyone was racing to implement as many IT solutions as possible, the primary goal was to maximize efficiencies. Productivity was paramount and technology enablement was the lifeblood of a successful TOM transformation, with little thought given to more esoteric concepts such as culture and leadership. The result was often increased productive output, but any genuine systemic change was uncommon. Organizations learnt to optimize their existing operating models, but weren’t doing things fundamentally differently. You only have to look at an organization like Blockbuster Video, which tweaked its productivity in favor of an operating model reinvention, only to realize that the risks of this mindset are very real.

The present…

Fast forward to the present and it’s clear that these traditional practices are no longer sufficient. We see three critical success factors for operating model transformation today.

1. People are at the heart of every successful operating model transformation: The Gate One ripple effect is the art of achieving more meaningful change long after consultants have left. It’s why line-led change – putting your staff at the forefront of TOM transformation – is something we build into our approach, every time.
2. TOM transformation is like a Rubik’s® Cube: The skill of good TOM design is to keep a balanced perspective on each of the different components of the TOM. Much like a Rubik’s® Cube in the hands of a novice, organizations often focus solely on one element without considering the whole. You move one part and another changes in a way that you have not anticipated. You twist it one way to solve one puzzle and another problem presents itself elsewhere.
3. Beautiful operating models fail: Many organizations fail to realize that it is essential to be agile and iterative. You need to be confident enough in the design to build and test in small increments to deliver quick wins while developing more systemic change.

We believe it is not what we do, but how we do it that leads organizations of all shapes and sizes to trust us to design their future state operating models.

The future…

However, we also know that if the shark stops swimming it dies. Therefore, it is important to constantly challenge yourself about newer and better ways to design operating models. While the layers of the operating model remain relevant, introducing new concepts and approaches to understanding and designing TOMs in innovative ways is crucial. For example, at Gate One, we:

• use accelerator events to design and create prototypes at pace, gaining buy-in and commitment from participants along the way;
• adapt and implement Scaled Agile and DevOps concepts and ways of working into digital and non-digital environments;
• use design thinking and customer experience mapping to better understand and interpret customer journeys;
• creating business cases that factor in social and other non-financial value into the cost-benefit analysis;
• place an increased emphasis on the power and role of data in decision making at all levels.

We are continuously adapting, and we’re helping our clients adapt too. For us, meaningful transformation sits at the nexus of operating model, digital innovation and people change. Those organizations that can find that sweet spot, will not just survive, but thrive.