The dynamic operating model

Every business has an operating model, whether it's consciously or unconsciously designed and deployed. What's your operating model and does it deliver for you and your customers?

Almost all the work I undertake involves engaging with a client's operating model (OM). This can include designing a new OM from the ground up for a pre-launch company or a start-up in its early growth stages, evaluating and updating an existing OM, or entirely reimagining a company's operations and implementing a new OM.

I think over the past however many years I've seen the whole range. From very detailed Target Operating Model documentation running into tens of pages long (TL;NR) to the other end of the scale and businesses that have organically developed and people just got stuff done. Unsurprisingly the second approach is mostly seen in start-ups where everyone needs to muck in on whatever the priority is. It's cost effective, builds teamwork (mostly) and focuses people on the things that are most important.

The thing is, that as a business grows, that approach can turn into chaos, confusion and cost through mistakes, a lack of clarity and a lack of co-ordination.

When I talk to clients about operating models there can be concerns that it might slow down quick changes that are needed, or that the result could be too rigid for their business or even that it means lots of new roles which equals cost.

In my career I have definitely seen those pitfalls come to fruition. In a recent McKinsey & Company study on operating models they found that "only 23% were highly successful" and "63% were somewhat successful". That's not great, particularly when you think of the effort and potential disruption the work may have brought about.

I believe that an OM review and resultant changes can avoid all of those pitfalls if done correctly. It doesn't need to be overly engineered, cost a lot of money or take so long that opportunities are missed. In fact, if done right, it can be freeing, build engagement and be deployed on a 'just in time' basis.

Our approach at Sooth Consulting is to quickly know a business through both qualitative and quantitative activities. We review data, the goals of the business and talk to people within the business - the approach is the same if there are 10, 100 or 1000 people in the business. Understanding the now and the future objectives means we can identify and describe the gap - and once we've described that we design the approach to closing it.

We build modular OMs that can be deployed over time as the business needs it to support their goals, whether that's growth, working more effectively, reducing the cost to serve, all of these or something else.

If you're interested to know how we can support you, drop us a line.

And if you're starting to think about the OM of your business our free and quick self-assessment tool would be a great starting place for you!