Every company wishes to provide value to its customers, for which they require a strong operating model that can assist in meeting their organizational performance objectives. According to estimates, nearly 70% of well-planned strategies fail due to poor execution. Furthermore, 61% of executives reported being unprepared for the challenges that came with being promoted to leadership positions. The end result? Within the first 17-18 months of being promoted or hired, an estimated 50%-60% of executives fail. Becoming a manager requires a significant shift in responsibilities. It is critical that leaders receive the support they require to lead teams effectively during the first few months.

Regardless of how strong your organization's business models are, it is the operating model that brings your business and profits to life.

An operating or operational model can help your organization perform better in order to adapt to a changing economic environment. Let's look at what constitutes an operational model. We'll also go over how to measure the effectiveness of an operating model that will keep your company one step ahead.

Understanding Operational Model

Everything changes — and changes quickly — especially in today's climate. To avoid roadblocks, many businesses are pivoting their direction, veering the steering wheel from left to right. Maintaining profitability while caring for your employees and customers is critical. An agile model is essential in times when margins for error may be narrower than ever.

A well-defined operating model is the backbone of your organization and dictates how you deliver products or services to your customers. However, just having a model in place is not enough. You need to measure its effectiveness to ensure that it's working optimally and delivering the desired results.

Metrics to Consider While Measuring the Effectiveness of Operational Model

But how do you measure the effectiveness of your operational model? Listed below are some key metrics that you should consider, including:

Efficiency: How well is your model delivering products or services in the most efficient way possible? Are you minimizing waste and maximizing productivity?

Customer satisfaction: Are your customers happy with the products or services you're delivering? Are they getting what they need, and are they satisfied with the quality?

Employee engagement: How engaged are your employees with the model? Are they aligned with its goals and objectives, and are they motivated to contribute to its success?

Financial performance: Is your model generating the desired financial results? Are you achieving your revenue and profit goals?

To measure these metrics, you'll need to gather data and analyze it regularly. This could involve conducting surveys with customers and employees, analyzing financial data, and monitoring productivity metrics.

However, measuring the effectiveness of your operating model isn't just about gathering data. It's also about using that data to make informed decisions and improve your operating model over time. By continuously monitoring and analyzing your metrics, you can recognize areas where you need to make changes and optimize your operating model for better results.

Summing it Up

We know that things will continue to change. There is uncertainty ahead, and strategy must remain flexible in order to adapt to what the world has in store for businesses. After all, businesses can only concentrate on their own locus of control. It is critical to be both pragmatic and optimistic about the future.

Companies like Thoughtworks can help you lay out an operational model that can help you enhance work efficiency and also assist you in climbing up the market ladder. Their digital transformation strategy is focused on the holistic development of the company and can assist you in accelerating your path to innovation and realizing business benefits more quickly.