Don’t be comfortable with the status quo!
Digital disruption is here and, unfortunately, the traditional operating models that have worked well in the past are NOT going to deliver the expected value to your companies or your customers going forward. Often, companies that are trying to make significant improvements to their operations are falling short of expectations.
The world is changing at an exponential clip where the traditional “brick-and mortar” retailers are being replaced by online-same-day-delivery vendors; traditional places for learning are being replaced by on-line schools; social media is transforming human interactions and reach and, soon, driving our own cars may become a thing of the past! Customer expectations are changing rapidly and, significantly, too. Call it the “Amazon Effect!”
What needs to change?
Rather than trying to “repave the cow paths,” progressive companies are re-inventing their operating model(s). This has translated to a re-design of their work processes, work systems and organizations to survive and thrive in the new landscape… aka the “digital world.”
The new, re-invented operating model will likely be a different way of running businesses that combines digital technologies and operations capabilities in an integrated, well sequenced way, to achieve a step change in their capabilities and significant improvements in their competitive position to deliver higher revenues, customer satisfaction and optimized costs. Do not consider mere acquisition of the “latest and greatest” technology to be the “silver bullet” as often is the case with many companies.
Organic and holistic approach to the operating model
The “one size fits all” approach will not lead to long term success. Therefore, the new operating model should be developed organically, based on your industry’s evolution, your company’s strategic intent and long-term strategy, paired with a holistic approach. This will go a long way to make sure that what you create is comprehensive, sustainable and aligned to your business needs of today and for the future.
- Think holistically about how operations can contribute to delivering a disproportionate customer value and experience rather than having “a bunch of disconnected initiatives” in silos
- Initiate an integrated, enterprise wide program organized around customer journeys, as well as, internal journeys (End to End Internal Processes)
- Think holistically across individual technologies, operations capabilities and approaches and apply them to the customer journeys in combination and, in the right sequence, to achieve a compounded impact
Developing a new operating model
Map your key customers’ journeys and, instead of trying to make incremental improvements, re-imagine the customer experience to unlock massive value
- Map your key customers’ journeys and, instead of trying to make incremental improvements, re-imagine the customer experience to unlock massive value
- Focus on “Lean Consumption” concepts rather than “Lean Provision” ones only
- Power all the operations and technology levers available in the business, ensuring that:
- You maximize the business/customer impact of each lever
- The levers are arranged in a logical order to add value to the customer and/or internal journeys
- The levers are working in a complementary way to generate maximum value
Levers to deploy:
- Organization Design: Build structures around integrated processes that directly deliver value to your internal and, more importantly, cash paying customers
- Process Design: Streamline and lean out the processes to minimize waste
- Technology architecture and design: Not just to automate routine tasks, but utilize it to capitalize on your customers needs and customize offerings in a unique way to increase competitive advantage
- Automation: Intelligently, replace routine human tasks and enrich the employee engagement by focusing your people on higher value added activities (requiring high analytical and cognitive capabilities)
- Digitization: Not just around internal operations, but connect them to the customer experience
- Analytics: Build and leverage advanced capabilities (including AI) to drive smart decisions by moving up the “Data Information Knowledge Insight” pyramid
- Outsourcing: Rather than depend solely on internal capabilities, leverage external expertise where it would add disproportionate value to its cost. Go for “strategic alliances” rather than transactional relationships with key suppliers
Last but not the least, THINK HOLISTICALLY but IMPLEMENT SEQUENTIALLY(customized play book and your own Roadmap).
Disruptive forces are here, and the future leaders will not just do the old things in new ways, but, re-invent themselves to do new things to delight their customers and capture market shares. Are you ready?
Atul Tandon brings over 30 years of experience as a global operations and general management executive with demonstrated capability in building and driving integrated supply chains to world class operational levels. He has extensive experience in conceiving and deploying transformational solutions through synchronizing the supply chain components, complemented by proven change management skills, and effectively leading the teams through the transition phrases. Most recently, Atul has been responsible for creating truly integrated, global, supply chains for Watson, BMS and Mylan – including deployment of world class Supply Chain Technology Platforms.