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Agile and Target Operating Models

Target - Target Operating Model

How can we hit the target in business? I have recently looked at Target Operating Models and Agile with one of my students. We’ve had some really interesting conversations and, of course, we’ve covered some great business English!

Read this post to improve your business English – especially your English for project management, Agile and Target Operating Models. I like to look for articles, videos and audio which are the best available resources for my students. I recommend this great blog post by Matt Edgar. He writes that Agile, or ‘Learning by Doing’ is ‘the Last Target Operating Model You’ll Ever Need‘. It’s a very thought-provoking post (it makes you think!). And I think Edgar is right that Agile presents a real challenge to Target Operating Models.

Key Vocabulary for Target Operating Models

Vocabulary. First, what is a Target Operating Model? “Target operating model is a description of the desired state of the operating model of an organisation. When working on the operating model, it is normal to define the “as is” model and the “to be” model. The Target Operating Model is the “to be” model.” (Wikipedia) An Operating Model is simply how the organisation should work.

Vocabulary. “As Is” and “To Be” The people who run or lead an organisation have an idea about how the organisation should be in the future. This is the “To Be”. They will also know how the organisation actually is at the present time. This is the “As Is”. The concepts of “As Is” and “To Be” are important in change management.

Agile Challenges T.O.M.

Now we understand the concept of a Target Operating Model (or T.O.M.), we can think about how the Agile approach to project management challenges the traditional TOM approach. Edgar lists several challenges.

Agile organisations:

are in touch with customer experience.

understand what is actually going on in their business – especially human interactions.

… can adapt (or change) frequently.

Key Vocabulary for Agile

The Agile approach is an iterative approach. What does this mean? In a short period, an Agile team will go through a number of steps such as planning, analysis, design, coding and testing. This is one iteration (noun). The team can then begin a new iteration. (Iterative is the adjective).

Edgar’s point is that, if an organisation is in touch with customer experience and is adapting (changing) frequently, then a traditional TOM approach cannot work. The traditional TOM approach is not flexible enough.

My own view is that it is possible to combine TOM and Agile, balancing flexibility and planning. It is essential to be customer-focused (customer-centric) in developing products and services. For a small or even a medium-sized organisation, perhaps Edgar is right when he says that Agile is the last TOM you’ll ever need. However, large organisations are not so responsive. They still need to put the customer first but TOM-style planning can help them ‘steer the ship’. Large organisations should ensure that their TOM is dynamic – in other words, it needs to change to meet customers’ developing needs and wishes.

What do you think? Do you work in an Agile organisation? Do you find that Agile can generate a lot of work?! Does your organisation have a TOM? Is the TOM fit for purpose?

Why not book a lesson with me to discuss this or another business English subject? You will learn even more by speaking and listening!

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