In our last article, we discovered what an operating model is and some of the benefits of properly defining your target operating model; in this article, we go on to uncover how you might go about it.
How do I document my model?
Let’s be clear; there is no general consensus on how to document an operating model.
Finding a good sample model you can use to follow can be challenging and disappointing. An optimised operating model creates an advantage in the market, so you’re unlikely to find your competitor’s models readily available.
And even if you did, while many parts would generally apply to most businesses in the same sector, the need to provide highly detailed diagrams linking parts of the organisation with explicit information about IT infrastructure means there are invariably differences.
We at Sabre tend to use our own standards for documenting models. Our presentations have evolved and matured through our combined many years of experience designing and implementing operating models. However, we do this with one eye on potential modelling standards today, monitor developments in the standards for documenting operating models, and adopt additional best practices as they evolve.
Where do I start?
You probably already have a whole host of operational documents that will be useful as you begin to form your operating model. Business functional breakdowns, organisational charts and designs, technical architecture and data and systems architectures often pre-exist in large numbers.
We, Sabre, can bring all these together into a coherent operating model that shows you where you are today and identifies where there are gaps, where there are duplications, and where they don’t currently fit with, or are even contradictory to, the strategy.
What end output could Sabre provide?
Sabre’s approach provides a suite of related diagrams, usually augmenting pre-existing organisational charts and systems architecture diagrams.
Our diagrams bridge the gaps and answer several questions using the same language, such as:
Functional responsibility: apportions a business’s functions and activities to internal parties (e.g. departments) or external providers. Here we tend to find some people did not know elements were their responsibility, or that others have managed to shift responsibility onto others!
Diagram of blank sticky notes on blackboard
Outlining functional responsibility is particularly useful when measured against aCapability Map , i.e. who is competent at undertaking functions and their capacity to do so. In sophisticated cases, functional responsibility diagrams have a temporal aspect, i.e. who is responsible for whatand when.
Operatingdiagram: sets out what functions are supported by which systems (and by inference which functions are not supported). An operating diagram usually focusses on a distinct business cycle over an extended period (e.g. a reporting cycle) and covers all the functions involved, the systems that support each function, and the data used. This is a complicated diagram and must be targeted to maintain legibility.
Data ManagementDiagram: focuses on where is data mastered, managed and distributed. An existing technical database diagram may show how data is structured within a system, but it is too low level for operating models. We would look to show how data is sourced, managed and distributed across systems. Stylistically it is closely related to a systems architecture diagram but extends to functions not supported by automation. We can also show data flows on operating diagrams.
These are just a few of the available diagrams, and Sabre are more than happy to look at all options.
Our projects which involve documenting a business’s operating model typically start with us drawing up the target operating model (TOM), the current model, and frequently several stages in between.
When unpicking the current model, what is especially interesting is finding a variable depth of understanding by business leaders about how their business actually works and what goes on.
If you’ve made it to the end of this article, then well done! We appreciate it’s quite a long read, and what it’s probably made you realise is that it takes hard work to develop and document your operating model.
We can assure you, though, it’s worth it! Having your existing model documented and a target operating model defined can take from as little as a few weeks to a couple of months, but the long-term benefits of alignment between strategy and operations can’t be underestimated.