We chatted with our Principal Consultant, Andrew Johnson, to discuss how to digitally transform operating models. Besides being enjoyable, it was a conversation full of insight. We discussed how organisations can build digital-ready operating models and the key shifts leaders need to make to reach the operating model of the future.
Historically, operating model design is just about how you organise yourself and what processes, governance and capabilities you need to deliver on your strategy. In the digital context, I think people mistakenly think that it's just about technology. It’s also about how you harvest, manipulate and use data in the best way you can. So, in the digital context, it's about understanding how you're going to receive, manage, and organise data, how through your processes you’re going to make the best use of it, and how you're going to use the governance and the decision making to make the best use of it, and then essentially make sure that you manage your data sets well. So I think it's a different context. In the old school, before we became digitally aware, you would just look at your processes, people and technology. Now it's much more about how you harness and exploit data to make better decisions and deliver the best value you can.
I would. Humans typically don't make very good decisions. Historically, we know that, because plenty of analysis has been done on the subject in the past. So the more you can move to using the data to drive your thinking or drive your decision making, the more likely it is you're going to make a better decision.
I think it is an increased focus on culture. There's a lot of behavioural change that needs to happen. So, for an executive perspective, the paradox for me is that we are brought in to help them deliver a data-driven operating model, but leaders need to be careful what they wish for. Because what you're effectively doing is moving the decision making down the tree, away from the executive team and more into operations.
From a behavioural perspective, people need to get used to the idea that leaders are no longer prime decision makers. They are coaches and enablers. They're the people who will be facilitating their teams to do the right thing. So it's as much about teaching people that this change in the way that you work isn't just a technical change, it's also a change in the culture.
You need to be brave as a leader. You need to be brave because half of what you're doing is actually recognising that you're fallible. So leaders are fallible, and they're equipping their teams to be better at doing what they're historically not very good at.
They need bravery. They need to recognise that the role of a leader is changing in a good way. They need bravery to be able to say that some of the things that were successful in the past may not work in the future. For example, the ability to see things at an enterprise level and make cogent decisions. That's changed because your role now is to enable your teams to understand what it is they're facing and allow them that freedom.
The biggest problem I see in all operating models is about trust. There is a huge problem because the team isn't being allowed or given the freedom to do what they need to do to enable agility. The leadership team aren't prepared to give away those levers. So part of the change they need to do is to appreciate that their role has changed from directive leadership to leadership through coaching and support. It's a real mindset shift.
The paradox is in organisations who put people through a big hiring process. They employ people because they're competent, because they're great. But then they don't allow them to actually spread their wings and make decisions based on the data, So it's about being brave enough to not constrain people.
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