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Management Consulting

Now Is the Time to Review Core Elements of Your Operating Model

Operating Model

We are now in the midst of unprecedented business upheaval and there is no shortage of recommendations and guidance on how companies should respond to the COVID-19 outbreak. But who is looking at the core elements of your operating model and what they will look like when this significant disruption abates?

As we know, the CDC has recommended that we limit all non-essential airline travel and several communities have issued “stay at home” directives. When these bans are lifted, how will your company respond? Companies are focused on “crisis management” and “response teams” to guide them through the coming months. But, who is looking beyond the immediate horizon?

One recommendation is to put a “transformation team” in place immediately to focus on preparing their company for post-COVID-19. Below are a few operating model areas to consider evaluating in the coming months:

  • Strategy – Executive leaders need to determine if the core business strategy will be impacted and cascade these changes down to the functional leads effectively. Functional strategy and priorities should be re-examined and re-prioritized.
  • People – There may be no greater impact to the business than the impact to our employees. As we transform, we need to determine if our people are prepared, trained, and understand their potentially new roles and responsibilities.
  • Customers – Our companies and our customers are going through substantial changes. What is our plan to re-engage our current customer base? Are we able to expand our customer base? These discussions should happen now, not at the end of this upheaval.
  • Processes – An environmental scan of core business processes should be completed to determine what processes were effective, evolved in the last few months, or broke down during the COVID-19 response. More importantly, the team should focus on what processes need to be changed to support the revised strategy and/or priorities.
  • Product, Pricing, and Promotion – Coming out of the COVID-19 situation, companies will all be hungry to get “back on track” and re-establish their market share, regardless of their business. There will be a lot of ideas and efforts to re-define products, adjust pricing, and promote their products to consumers that will be ready to spend. These efforts have to be coordinated and aligned to avoid further disruption or confusion (internally or by the customer). Efforts should be started today.
  • Technology and Data – Any deficiencies in the tech and data capabilities likely became very apparent as the business was stressed. Are we tracking these deficiencies and uncovered opportunities? Now is the time to determine the potential impact to our current roadmaps and technology budgeting.
  • Governance – Governance takes on a lot of definitions and governs all types of processes. How did your governance construct maintain the business? The team should evaluate the elements that are, or should be, governed moving forward. These may include budgeting, initiative selection and management, technology and data, product, pricing, and promotion.
  • Performance Measurement – One area that is often overlooked, especially in times of “normal business,” is performance measurement. If we cannot collect, disseminate, and communicate performance during regular business operations, how are we measuring performance in these difficult times. We should use this time to determine the critical measurements that guide our business and develop a plan to put these measures in place.
  • Partners – Partners are a vital portion of many businesses today. While we may have been communicating with our partners, are we planning with our partners for a potential transformation of the business?

The last vital business operating model capability is the most important. How have we managed the change in the past few months? Effective change management is built around understanding the impact to our key stakeholders (employees, customers, partners, etc.), communicating changes effectively, and educating/training these stakeholders to help transform the the business. All of this is done while managing the changes today, and tomorrow.

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Greg Hurst

Greg is a director in Perficient's management consulting practice. He is focused on guiding clients in addressing all areas of their operating model. These operating model capabilities include aligning business and technology strategies, organizational transformation, process optimization, governance establishment, and operational measurements.

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