Shaping tomorrow's operating model

Last month I discussed the importance of the operating model on the ability to respond to the changes media business is facing. But what are the imperatives in shaping the operating model of the future?

The first stage is to identify those priorities or strategic principles that will shape the operating model in this post-recessionary environment. Our experience highlights these to be: delivering revenue growth; cost focus; and providing a platform for profitability. In parallel with initiatives targeted at these priorities, a number of industry trends - the drive towards greater collaboration, an increased focus in strategic assets, flatter management structures, more ways to enable third party partnerships - are combining to give rise to two distinct organisations: networked or conglomerate. Networked structures are strategically aligned, best-of-breed businesses that realise benefits from sharing transactional processes. Conglomerates focus on managing a diversified portfolio of investments and will be seen most where companies have expanded from their core business.

The next stage is to identify the key value chain components ‘essential for success’. This allows maintenance or development of the attributes required to support such ‘essentials’.

Next comes the development of operating model options and testing the variants available, landing on the one that understands the key decisions required and their relationship with who does what, ie the implication layer. The primary motive here is to understand the relationship between decisions and execution. 

The final stage is translating the target operating model to weave in other enablers such as organisation design, performance management approaches etc. Good luck!

This article was originally published in the December 2010 issue of Campaign.