Organisational Design –
Target Operating Model
Many companies are reviewing from time to time the fit of their operating model and organizational design. Trigger events can be for example the acquisition and integration of a new company, significant growth of the organization, expanding into new markets, a change in the business strategy, a new investor coming in, the need for efficiencies and cost savings.
Reworking the operating model and defining a new target organization can be a massive undertaking and quite unsettling for the teams. Therefore it is important to clarify upfront clearly the scope of the rework and what the focus for the new Target Operating Model (TOM) is. Often the TOM is only been perceived as the pure organizational structure, like who is reporting to whom, how many management layer exist in an organization, what is the span of control etc. These are, no doubt, key elements of a TOM but there can be very important others such as culture, people and processes in an organization. It makes sense to think carefully about what elements should be assessed and adapted for the new TOM.