A Target Operating model (TOM) is a method of applying the corporation vision or business strategy. This is a high level representation of how the company can be organised to efficiently and effectively deliver and execute on the strategy. The simplest form involves three elements, people, processes and technology. To accomplish the desired mission, you require the correct people, processes and technology. A Target operating model can be simple or complex and depends largely on the company size/industry and business model.
Ex. A Travel Website Client.
May have the goal to increase traffic by 4x. To accomplish this for “PEOPLE” they calculate they need to recruit three times more travel writers and hire two more SEO Marketers. For the “PROCESS” they Train them with an efficient process for both blog creation, submission and editing. ,this can be called a SOP (Standard Operating Procedure). Then the “TECHNOLOGY” platform needs to be reliable and have sufficient capacity to handle the new uploads.
Target operating model. Source: mysocialgenie.com
To further breakdown, the target operating model and how it fits with the organisation, here is a organisational pyramid from large consultancy firm Deloitte.
Target Operating Model . Deloitte
KPMG also has a detailed target operating model
Target Operating Model KPMG
A Target operating model is a key element of any large organisation and helps everyone to visualise the processes. Creating a reliable target operating model, requires first asking the right questions and basing assumptions on reliable data and industry experience. Multiple stakeholders can help to mould and shape the model with industry expertise draw upon. The model should be a “living plan” and evolve when new information becomes available or metrics show the current process isn’t working.
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