7+ What is a Target Operating Model? (TOM) Explained

what is a target operating model

7+ What is a Target Operating Model? (TOM) Explained

A description of the desired state of an organization’s business operations achieves specific strategic goals. It defines the optimal organizational structure, processes, technology, and data required to execute the business strategy effectively and efficiently. For example, a company aiming to improve customer service might envision a future state with integrated CRM systems, streamlined workflows, and clearly defined roles and responsibilities, all outlined within this framework. This blueprint provides a roadmap for transformation and serves as a benchmark to measure progress.

Optimizing operational efficiency, improving agility, and enabling better decision-making are some key advantages of having a clearly defined future operational structure. Historically, organizations often relied on ad-hoc or incremental approaches to operational improvement. However, the increasing complexity of the business environment and the need for rapid adaptation have made a holistic, future-oriented perspective essential. A well-defined plan helps organizations align their operations with their strategic objectives and fosters a culture of continuous improvement.

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8+ Target Operating Model Templates & Examples

target operating model template

8+ Target Operating Model Templates & Examples

A pre-designed framework provides a structured approach to defining how an organization will function in the future. It typically includes key components such as organizational structure, processes, technology, and data, offering a blueprint for achieving strategic objectives. A practical illustration might involve a company restructuring its customer service operations, outlining specific roles, revised workflows, and new software platforms within this framework.

Utilizing such a structured approach offers several advantages. It fosters clear communication and alignment across the organization by providing a shared vision of the future state. This structured approach can also facilitate more efficient implementation by identifying potential roadblocks and dependencies early on. Historically, the increasing complexity of business environments and the need for greater agility have driven the adoption of these structured approaches to organizational transformation.

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