Description
Operating model is the abstract representation of how an organization operates across process, organization and technology domains in order to accomplish its function
Consulting
An Enterprise Operating Model that Connects Strategic Intent to Operating Tactics
Your operating model should represent a critically important bridge between where your business is going and how it’s going to get there
One of the key impacts of the constant change in today’s business world is a new view of what constitutes an effective—and appropriately broad and ?exible—operating model. Traditional thinking held that an operating model is about organization design, but we believe that is too narrow a de?nition for today’s market dynamics. Successful business enterprises today constantly take in new information about their markets, customers, and operating environments. Then management uses that knowledge and data to shape new strategic directions, to reorganize how they respond to marketplace demands, and to ensure that their views of all aspects of the business are fresh and viable. Ensuring that projects throughout the organization support these new goals and approaches is a huge task. The business operating model, as a key facilitator of effective decision-making, must serve as a critical bridge between the strategic intent of the business and the operating tactics of process, people, and technology. Analyzing and developing a new operating model is the key link to ensure that all business activities are in alignment with—and supportive of—overall business objectives. Does your organization have the right enterprise operating model to deal with change in today’s marketplace in a timely and effective way? Having a complete view of your operating model and understanding its role as a bridge between strategy and tactics will help you move your organization to the desired future state faster, as well as provide clear communications from management to operating units, and offer reliable support for project evaluations.
How to Drive More Value Through a Well-Designed Operating Model
We’ve helped some of the world’s leading organizations develop a new operating model, or modify an existing one, in ways that drive tremendous value. Business Value is created by tightly linking enterprise-level strategic intent to the more detailed operating components of process, people, and technology. The result has been a more simpli?ed business structure, lower costs, clearer accountabilities and faster execution. Here are some of the key lessons that we’ve learned along the way that we can apply to your operations. Operating models are not just organization design. Although organization design is a critical component of an operating model project, it is not the sole objective. We believe there is an interim step, and decisions on the overall structure of the enterprise that need to be made before a detailed organization design is completed. Operating models help everyone. Redesigning an operating model does not have to be an enterprise-wide activity, but it can have a very positive impact on all aspects of the enterprise. Our clients receive great value in updating their business model within a number of different areas throughout their organizations, regardless of which speci?c strategic area was driving the project. High client involvement is a key to success. No one knows an organization like the people who manage and operate it. Therefore, we ?nd it essential to work directly with our clients throughout the operating model design process, from the most senior levels to the most detailed operating levels. In this way, they take the journey. Outside insight is important. Proximity to the existing model on a daily basis can promote resistance to taking new points of view. The outside perspective of our experienced professionals and operating model specialists can serve a very constructive role in paving the way for fresh new approaches and for recommending and implementing leading practices across an entire industry. Don’t forget about governance. Establish decision-making roles before decisions need to be made. Clear decision-making responsibility in a new operating model can make or break its design.
Getting It Done
There are four common business “events” or “Triggers” that most often drive the need for developing, evaluating or modifying the operating model of the business: 1. Cost reduction, Shared Services and Business Simpli?cation challenge 2. Business merger or divestiture event (e.g. expansion in new global markets) 3. Fundamental shift in business models or corporate strategy 4. Front-end to a major ERP implementation Operating Model design is a comprehensive and complex exercise. We help our clients by facilitating a complete and thorough review of the business challenge, opportunity and implications for the operating model design. We excel in providing our clients with a fresh, holistic perspective on the operating model design and bring a broad range of capabilities to support planning through execution. We offer access to a diverse range of services, capabilities and skills including extensive depth of experience in strategy and operations, governance, tax, process optimization, information technology, organizational design and integration, enterprise cost reduction, talent management and outsourcing, just to name a few. Our broad industry and business experience in both strategic capabilities and project implementation will help you make sure your operating model supports your organization’s strategic intent and your project level investments and tactics. Our team will work with you to execute an accelerated operating model development process that will deliver your future operating model design and a roadmap of actionable steps to help you achieve your goals. Breakthrough performance requires a well thought out operating model. At Deloitte, we bring a unique combination of innovative thinking, operating model experience and disciplined follow-through needed to deliver results. We work with senior executives to improve the performance and value creation of their companies – and to choose the right course of action, with executable strategy.
Contact
To learn more about our operating model capabilities and how we can help your business develop, contact: Douglas Tuttle, Principal Deloitte Consulting LLP Boston, MA Tel: 617.437.2212 e-mail: [email protected] David Brainer Principal, Deloitte Consulting LLP Cincinnati, OH Tel: 513.7847230 email: [email protected] www.deloitte.com/us/StrategyandOperations
Bottom-Line Bene?ts
A complete operating model will cover governance, legal structures, customer segments , ?nancial and operating metrics, distribution and partnership channels, business processes and information technology. We often see the following measurable bene?ts: • Develops a clear de?nition of the core business operating principles • Creates a consolidated and documented view of the future Operating Model • Rapidly gains alignment of managers and employees to the new design, and the connection with the overall ?rm’s strategies • Provides clear links between the strategies and tactical decisions for People, Process, and Technology • Helps develop frameworks for prioritizing new project investments, evaluating project alignment and performance and providing input into new system design
This publication contains general information only and Deloitte Consulting LLP is not, by means of this publication, rendering business, ?nancial, investment, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a quali?ed professional advisor. Deloitte Consulting LLP, its af?liates, and related entities shall not be responsible for any loss sustained by any person who relies on this publication. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, its member ?rms, and their respective subsidiaries and af?liates. As a Swiss Verein (association), neither Deloitte Touche Tohmatsu nor any of its member ?rms has any liability for each other’s acts or omissions. Each of the member ?rms is a separate and independent legal entity operating under the names “Deloitte,” “Deloitte & Touche,” “Deloitte Touche Tohmatsu,” or other related names. Services are provided by the member ?rms or their subsidiaries or af?liates and not by the Deloitte Touche Tohmatsu Verein. Deloitte & Touche USA LLP is the U.S. member ?rm of Deloitte Touche Tohmatsu. In the United States, services are provided by the subsidiaries of Deloitte & Touche USA LLP (Deloitte & Touche LLP, Deloitte Consulting LLP, Deloitte Financial Advisory Services LLP, Deloitte Tax LLP, and their subsidiaries), and not by Deloitte & Touche USA LLP. Member of Copyright © 2008 Deloitte Development LLC. All rights reserved. Deloitte Touche Tohmatsu
doc_698793070.pdf
Operating model is the abstract representation of how an organization operates across process, organization and technology domains in order to accomplish its function
Consulting
An Enterprise Operating Model that Connects Strategic Intent to Operating Tactics
Your operating model should represent a critically important bridge between where your business is going and how it’s going to get there
One of the key impacts of the constant change in today’s business world is a new view of what constitutes an effective—and appropriately broad and ?exible—operating model. Traditional thinking held that an operating model is about organization design, but we believe that is too narrow a de?nition for today’s market dynamics. Successful business enterprises today constantly take in new information about their markets, customers, and operating environments. Then management uses that knowledge and data to shape new strategic directions, to reorganize how they respond to marketplace demands, and to ensure that their views of all aspects of the business are fresh and viable. Ensuring that projects throughout the organization support these new goals and approaches is a huge task. The business operating model, as a key facilitator of effective decision-making, must serve as a critical bridge between the strategic intent of the business and the operating tactics of process, people, and technology. Analyzing and developing a new operating model is the key link to ensure that all business activities are in alignment with—and supportive of—overall business objectives. Does your organization have the right enterprise operating model to deal with change in today’s marketplace in a timely and effective way? Having a complete view of your operating model and understanding its role as a bridge between strategy and tactics will help you move your organization to the desired future state faster, as well as provide clear communications from management to operating units, and offer reliable support for project evaluations.
How to Drive More Value Through a Well-Designed Operating Model
We’ve helped some of the world’s leading organizations develop a new operating model, or modify an existing one, in ways that drive tremendous value. Business Value is created by tightly linking enterprise-level strategic intent to the more detailed operating components of process, people, and technology. The result has been a more simpli?ed business structure, lower costs, clearer accountabilities and faster execution. Here are some of the key lessons that we’ve learned along the way that we can apply to your operations. Operating models are not just organization design. Although organization design is a critical component of an operating model project, it is not the sole objective. We believe there is an interim step, and decisions on the overall structure of the enterprise that need to be made before a detailed organization design is completed. Operating models help everyone. Redesigning an operating model does not have to be an enterprise-wide activity, but it can have a very positive impact on all aspects of the enterprise. Our clients receive great value in updating their business model within a number of different areas throughout their organizations, regardless of which speci?c strategic area was driving the project. High client involvement is a key to success. No one knows an organization like the people who manage and operate it. Therefore, we ?nd it essential to work directly with our clients throughout the operating model design process, from the most senior levels to the most detailed operating levels. In this way, they take the journey. Outside insight is important. Proximity to the existing model on a daily basis can promote resistance to taking new points of view. The outside perspective of our experienced professionals and operating model specialists can serve a very constructive role in paving the way for fresh new approaches and for recommending and implementing leading practices across an entire industry. Don’t forget about governance. Establish decision-making roles before decisions need to be made. Clear decision-making responsibility in a new operating model can make or break its design.
Getting It Done
There are four common business “events” or “Triggers” that most often drive the need for developing, evaluating or modifying the operating model of the business: 1. Cost reduction, Shared Services and Business Simpli?cation challenge 2. Business merger or divestiture event (e.g. expansion in new global markets) 3. Fundamental shift in business models or corporate strategy 4. Front-end to a major ERP implementation Operating Model design is a comprehensive and complex exercise. We help our clients by facilitating a complete and thorough review of the business challenge, opportunity and implications for the operating model design. We excel in providing our clients with a fresh, holistic perspective on the operating model design and bring a broad range of capabilities to support planning through execution. We offer access to a diverse range of services, capabilities and skills including extensive depth of experience in strategy and operations, governance, tax, process optimization, information technology, organizational design and integration, enterprise cost reduction, talent management and outsourcing, just to name a few. Our broad industry and business experience in both strategic capabilities and project implementation will help you make sure your operating model supports your organization’s strategic intent and your project level investments and tactics. Our team will work with you to execute an accelerated operating model development process that will deliver your future operating model design and a roadmap of actionable steps to help you achieve your goals. Breakthrough performance requires a well thought out operating model. At Deloitte, we bring a unique combination of innovative thinking, operating model experience and disciplined follow-through needed to deliver results. We work with senior executives to improve the performance and value creation of their companies – and to choose the right course of action, with executable strategy.
Contact
To learn more about our operating model capabilities and how we can help your business develop, contact: Douglas Tuttle, Principal Deloitte Consulting LLP Boston, MA Tel: 617.437.2212 e-mail: [email protected] David Brainer Principal, Deloitte Consulting LLP Cincinnati, OH Tel: 513.7847230 email: [email protected] www.deloitte.com/us/StrategyandOperations
Bottom-Line Bene?ts
A complete operating model will cover governance, legal structures, customer segments , ?nancial and operating metrics, distribution and partnership channels, business processes and information technology. We often see the following measurable bene?ts: • Develops a clear de?nition of the core business operating principles • Creates a consolidated and documented view of the future Operating Model • Rapidly gains alignment of managers and employees to the new design, and the connection with the overall ?rm’s strategies • Provides clear links between the strategies and tactical decisions for People, Process, and Technology • Helps develop frameworks for prioritizing new project investments, evaluating project alignment and performance and providing input into new system design
This publication contains general information only and Deloitte Consulting LLP is not, by means of this publication, rendering business, ?nancial, investment, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a quali?ed professional advisor. Deloitte Consulting LLP, its af?liates, and related entities shall not be responsible for any loss sustained by any person who relies on this publication. About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, its member ?rms, and their respective subsidiaries and af?liates. As a Swiss Verein (association), neither Deloitte Touche Tohmatsu nor any of its member ?rms has any liability for each other’s acts or omissions. Each of the member ?rms is a separate and independent legal entity operating under the names “Deloitte,” “Deloitte & Touche,” “Deloitte Touche Tohmatsu,” or other related names. Services are provided by the member ?rms or their subsidiaries or af?liates and not by the Deloitte Touche Tohmatsu Verein. Deloitte & Touche USA LLP is the U.S. member ?rm of Deloitte Touche Tohmatsu. In the United States, services are provided by the subsidiaries of Deloitte & Touche USA LLP (Deloitte & Touche LLP, Deloitte Consulting LLP, Deloitte Financial Advisory Services LLP, Deloitte Tax LLP, and their subsidiaries), and not by Deloitte & Touche USA LLP. Member of Copyright © 2008 Deloitte Development LLC. All rights reserved. Deloitte Touche Tohmatsu
doc_698793070.pdf