Every organization wants to operate efficiently, effectively, and in line with its strategic objectives. The Target Working Model (TOM) is a system that assists organizations with accomplishing these objectives. It is a comprehensive description of how an organization operates, covering everything from processes and roles to systems and technology. In this blog entry, we will take you through all that you really want to realize about the Target Operating Model. We will cover what it is, how to create one for your business, its importance, the role of technology in TOMs, different types of TOMs, and the benefits of having a well-defined Target Operating Model. So buckle up as we dive into the world of Target Operating Models and explore how they can help your organization operate more efficiently.
What is the Target Operating Model (TOM)?
A target operating model (TOM) is a framework that defines how an organization operates and delivers value to its customers. It gives a reasonable and organized way to deal with adjusting the association’s capacities, cycles, and assets with its essential goals. The TOM outlines the key functions, processes, roles, and responsibilities within the organization, as well as the relationships between different departments or small business units. It also defines the technology and infrastructure needed to support the organization’s operations. By implementing a target operating model, organizations can improve efficiency, reduce costs, enhance customer satisfaction, and achieve their strategic goals.
How to Create a Target Operating Model?
To create a Target Operating Model (TOM), follow these steps:
1. Identify Your Business Objectives
Incorporate corporate strategy and KPIs to align the target state operating model with key organizational goals. Utilize digital transformation as a great tool to drive the organization’s transformation journey. Link business objectives with high-level KPIs for operational excellence. Ensure that the target operating model supports revenue streams and product offerings.
2. Analyze Current State
Assessing the current operating model structure, processes, and performance metrics is crucial. Identifying operational levers and key components of the current operating model can provide valuable insights. It’s essential to evaluate internal factors and external drivers influencing the current operating model alongside conducting a value chain analysis to understand operational dependencies and inefficiencies. Utilizing business vision and design principles will guide the analysis of the current state.
3. Define Roles and Responsibilities
Establishing a robust governance structure is crucial to defining decision-making authorities and accountabilities within the organization. It’s essential to align stakeholders and the management system with the target operating model’s governance while incorporating strategic intent into role definitions. Leveraging enterprise architecture can further enhance governance principles and role clarity, supporting the organization’s strategic blueprint.
4. Design Processes and Workflows
Developing workflows to align with the strategic vision and meet customer needs is crucial. Integrating operational excellence initiatives and leveraging information technology are essential for optimizing processes. Mapping operational workflows to support transformation initiatives and business strategy ensures alignment with the target state. Implementing design principles enables efficient processes and workflows, driving digital transformation.
Importance of a Target Operating Model
A Target Operating Model (TOM) is pivotal for associations as it gives an unmistakable outline of how the business will work later in the state. There are a few justifications for why a TOM is important:
- Alignment: It guarantees that all parts of the association are lined up with its essential targets and objectives. This helps to focus efforts and resources toward a common vision.
- Efficiency and Effectiveness: A well-defined TOM helps streamline processes, reducing duplication of efforts and improving overall operational efficiency. It empowers the association to work in a more powerful and cost-effective way.
- Change Management: When organizations go through significant changes, be it due to growth, restructuring, or digital transformation, a TOM helps manage these changes effectively by providing a clear roadmap for implementation.
- Clarity and Consistency: It gives clearness on roles, obligations, work processes, and dynamic cycles across the association, guaranteeing consistency in activities.
- Risk Management: A TOM can help identify and mitigate potential risks by establishing clear governance structures and control mechanisms. It empowers organizations to plan their tasks around the requirements of their clients, prompting further developed consumer loyalty and devotion.
- Customer Focus: It empowers organizations to plan their tasks around the requirements of their clients, prompting further developed consumer loyalty and devotion.
- Scalability: A well-designed TOM allows for scalability, enabling the organization to adapt and grow without major disruptions.
Role of Technology in the Target Operating Model
Technology plays a crucial role in the target operating model of businesses today. It empowers associations to smooth out their activities, further develop proficiency, and improve customer experiences. From automating manual processes to implementing advanced data analytics, technology allows businesses to optimize their performance and make more informed decisions.
Additionally, it facilitates seamless communication and collaboration within and across teams, enabling smoother workflows and faster decision-making. With the fast headways in innovation, organizations should ceaselessly adjust and use new apparatuses and stages to remain serious in the present advanced scene. By integrating technology into their target operating model, organizations can drive innovation, improve agility, and achieve sustainable growth.
How to Design a TOM Template?
Designing a TOM (Target Working Model) format can be a mind-boggling task; however, with cautious preparation and thought, you can make a powerful and productive template. Here are some steps to help you design a TOM template:
- Define your objectives: Before designing your TOM template, it’s important to define the objectives of your target operating model clearly. What are you trying to achieve? What processes or functions will be included in the model?
- Gather input from stakeholders: Consult with key stakeholders to gather their input and insights. This can help ensure that the TOM template meets the needs of all relevant parties.
- Identify key components: Determine the key components that need to be included in your TOM template. This may include organizational structure, processes, technology, governance, and performance metrics.
- Customize the template: Tailor the TOM template to fit your organization’s specific needs and requirements. Consider factors such as industry-specific regulations, company culture, and strategic goals.
- Test and refine: Once you have designed your TOM template, test it with a pilot group or department to identify any areas for improvement or refinement. Solicit feedback from users and make necessary adjustments.
- Communicate and implement: Clearly communicate the TOM template to all relevant stakeholders and provide training or support as needed. Ensure proper implementation of the model across the organization.
By following these steps, you can design a comprehensive and effective TOM template that supports your organization’s goals and objectives.
Different Types of Target Operating Models (TOMs)
Larger organizations tailor target operating models to their scale and complexity, focusing on agility, optimization, and strategic objectives. Government organizations use TOMs to enhance service delivery and governance, driving operational excellence. Different types of TOMs address unique organizational needs and stakeholder requirements.
1. TOMs in Larger Organizations
Larger organizations drive transformation initiatives through target operating models, focusing on strategic blueprint alignment and information technology. Integration of workforce capability, supply chain, and enterprise architecture is crucial for success. Strategic intent and metrics are vital for transformation initiatives, considering external drivers, internal factors, and operating model governance.
2. TOMs in Government Organizations
Government organizations use target operating models to enhance service delivery and governance, aligning with strategic goals and design principles. Integrating business analysts, transformation initiatives, and training programs, these models prioritize strategic vision, enterprise architecture, and workforce optimization. Successful implementation requires agility, governance, and strategic objectives.
3. Start-up TOMs
Establishing a strong foundation for growth, start-up TOMs outline a business’s key operations, including resources, processes, and technology. Flexibility is essential to accommodate evolving needs, aligning with the company’s goals and values. Involving experienced professionals ensures an effective and efficient start-up TOM, facilitating a smooth transformation journey.
4. TOMs in High-Performance Sports & Gaming Organizations
In high-performance sports organizations, TOMs streamline operations and maximize performance, while gaming organizations use TOMs to optimize player experiences and drive revenue. Agility and flexibility are prioritized in these industries to adapt to changing market conditions and player needs. Successful examples include the high-performance sports model used by the New Zealand Rugby Union and the agile TOM used by Riot Games for League of Legends.
Benefits of Having a Well-defined Target Operating Model
Having a distinct target operating model can carry various advantages to an association. Firstly, it provides clarity and alignment within the organization by clearly defining roles, responsibilities, and processes. This helps to streamline operations and eliminate any confusion or duplication of efforts.
Besides, an obvious target operating model empowers viable asset designation, guaranteeing that assets are distributed in such that supports the association’s essential targets. This can prompt superior proficiency and cost-adequacy.
Additionally, a well-defined target operating model allows for better decision-making as it provides a framework for evaluating and prioritizing initiatives and investments.
By and large, having a distinct target operating model can improve an association’s presentation, deftness, and capacity to accomplish its objectives.
Conclusion
All in all, an obvious target operating model (TOM) is important for the achievement and development of any organization. It helps align business objectives, streamline processes, and ensure clear roles and responsibilities. With the right TOM in place, organizations can optimize efficiency, reduce costs, and improve overall performance. Technology plays a vital role in implementing and supporting a TOM, enabling automation and data-driven decision-making. Whether you are a big company, an administration association, a startup, or a games/gaming association, there is a particular sort of TOM that suits your requirements. By designing a comprehensive TOM template, you can customize it to fit your organization’s unique requirements. Embracing a well-defined target operating model brings numerous benefits, including increased agility, scalability, and adaptability to market changes. So, invest time and effort in creating a robust TOM to drive your organization toward success.
