Traditional Operating Models are broken.

Posted on 21/05/20 in

One of our observations as to why digital transformations have failed is due to organisations trying to recreate their existing operating model and processes on to technology products. Not really trying to transform at all and spending a lot of money in the process.

Organisations need to be moving away from traditional operating models and consider what digitisation really means from a front to back office perspective. Traditional processes need to be tipped on their head and customers need to be placed at the heart of how the business runs and provides its products & services.

The leveraging of data to

  • provide better customer experiences & outcomes
  • make better business decisions
  • improve quality
  • develop insights
  • support automation

has to be a critical part of any business moving forward.

Ecosystems not architectures

We should not think about our operating models in the traditional sense nor in the traditional architecture blocks. We need to see our businesses as ecosystems that

  • incorporate the relationships between key stakeholders
  • automate the traditional processing
  • see seamless information flows of data
  • are specific to their environment
  • can adapt to market forces and changes
  • leverage specialist services and innovations
  • evolve and develop over time

We must leverage the environment we are already operating within and build on those elements that can support the strategy of that organisation.

So what’s broken

Many traditional organisations still view their businesses in the separation between sales (distribution), operations (services & manufacturing) and support functions. Those succeeding and growing see the interaction between customer and their products/services as more seamless interactions and relationships, focusing on delivering customer outcomes and seamless information flows. This allows for better customer outcomes, delivering reduced cost bases and better decision making through the automation of the traditional back office functions.

Go back to first principles and don’t just look at a narrow part of the business if you want to truly digitise your business. You must break down the traditional silos and look at what capabilities are required to succeed in the future.

Starting out

Starting out on any transformative journey and large scale change investment must be clear it can answer the following key questions

  1. What is your vision on how you operate in the future?
  2. What capabilities do you need to operate and succeed in the future?
  3. Where is the greatest value driven from within your organisation?
  4. Are you clear on the problem you are trying to solve? Are the key stakeholders aligned on that?
  5. How does solving the problem meet with the strategy of the organisation?
  6. Are you clear on the requirements that must be met and the criteria that must be met?
  7. Are the tangible benefits clearly understood?
  8. What environment does the solution need to operate within?
  9. What are the different solution options to be considered and why are you going with the selected solution?
  10. How do you determine the best fit for your organisation?
  11. What capabilities will be required to deliver & run the change? How do I fulfil that capability?
  12. How do we ensure we are able to pivot and change over time?
  13. What are the competition doing?
  14. What can I learn from other organisations?


The technology angle

At a high-level when looking at things from a technology perspective you should consider the following

  • Macro technology decisions made now, will effect how your organisation perform in the medium to long term
  • You have to consider that we are now moving into the age where we are all in tech one way or another
  • The ambition of an organisation and its longevity has to be considered
  • Understanding where an organisation sees its Value and IP is critical
  • Any organisation who does not want to be left behind must understand the value of its data and how/what role AI & Machine Learning will play
  • Do not rebuild what you already have

Understanding your existing estate and the most effective way to move away from it is critical to success. Do not just attempt to rebuild what you already have.

The future

Leveraging the technology available to deliver better outcomes will mean

  • The customer must be at the centre of your operating & business model
  • Leverage of big data is critical from both internal & external sources
  • Traditional functions will be automated and it will be about decision making, creating new products/services & navigating the landscape
  • AI & Machine Learning will be essential for insights & analytics to support Customer Experience, tailor products and support strategic decision making
  • Utilising IaaS/PaaS solutions allow businesses to scale
  • Data Privacy is critical for trust, building solutions with security by design is essential
  • Agility and adaptability will be critical for long term survival

Get in touch to discuss how we can support you in digitising your business and developing your future model. Contact Us

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