BUSINESS OPERATING MODEL
In most cases, we have noticed that it is not enough to simply formulate, blueprint and communicate the high level strategy, and expect satisfactory results. Translating the Strategy into a Business Operating Model (BOM) clarifies the Strategy and sets the tone for Action. Your Business Operating Model (BOM) explains how your organization’s Strategy translates into Revenues and Costs, whether the organization is profit-driven or not. The BOM has two aspects; firstly the Revenue generation side called the Business Model, concerned with decisions and choices that identify and optimize all revenue enabling aspects (Revenue Drivers) of your organization e.g. your value propositions, customer segments, services/products, differentiators, and prices. When we model the Revenue side of your business, we are simply answering the main Question; how are you going to make money?
The Cost side of your business, the Operating Model, is concerned with decisions and choices that identify and optimize all costs drivers so that your Company meets its business objectives. Under the Operating Model, we look at Operational Enablers, which include your channels, technologies, partners, structure, skills, etc., as we try to answer the Question; how are you going to operate? Based on our experience, we are able to combine these two strategy-enabling pillars – business and operations – to come up with a clearly articulated model of executing Strategy; your Business Operating Model (BOM), which demonstrates exactly how your Company is going to deliver on its business objectives and meet its performance targets. We construct your BOM once your core Strategy has been formulated. The output of our work is a Business Operating Model Canvas, which you can then use to communicate your Strategy to employees, investors, and other strategic partners up and down your value chain. Under Business Operating Model, we deliver the following;
- Identifying your core customer segments and crafting appropriate, exciting value propositions for those segments
- Formulating a Service Model for your identified segments, and developing appropriate products and services specs, based on segment profile
- Modeling and setting pricing options in order to meet your revenue targets whilst meeting production targets and realizing the desired margins
- Identifying the most appropriate channel mix and strategy that gives you the widest reach, whilst achieving cost-effective take-to-market
- Identifying, connecting and optimizing all the key activities across your value chain in order to minimize operational bottlenecks and costs
- Identifying Strategic Partners that you need onboard to achieve cost optimization and quality targets via targeted and intelligent outsourcing.