The faster competitive situations change, the faster rigid corporate structures reach their limits on how companies can build an agile operating model in five steps to meet current customer requirements.
The chances of success for companies to remain competitive in the future with the traditional Taylor top-down system are rapidly decreasing. The long successful principle of instruction and control (command and control) is now viewed as too rigid and too slow to satisfy the changed customer requirements. What is required today is more excellent proximity to customers and more flexible reactions to their wishes. The business and IT service provider CGI names five steps on the way to an agile operating model as a guide.
Agile Operating Model: Reshaping The Value Chain
In an agile organization, the operating model is thought of by the customer. At the center of the changed value chain are decentralized teams that bundle employee know-how from different areas. Essential elements with direct customer contact, such as sales, marketing, and service functions that determine the customer’s perception and experience and thus their shopping behavior.
Decentralized Business Structure
Companies have to shift the responsibility and decision-making authority for the operative business away from the central functions to where the contact with the customer is most intensive. Decentralized activities and decision-making powers are given a much more substantial weighting, while companies limit their main activities only to the most critical functional areas. In this way, customer requests can be recorded more precisely and fulfilled more quickly.
Added Value For Customers Through An Agile Operating Model
The more intensive customer contacts of the decentralized teams make it possible to understand customer requirements better and create real added value from this knowledge. The teams decide how the company should design the value chains with the operating models and processes (business imperatives) and production (assets) such as vehicles or production capacities. The company aligns them so that it can offer its customers the greatest possible benefit.
Development Of The Necessary Skills
Based on the customer experience, the decentralized teams also check the necessary capabilities to meet customer requirements. You determine which skills are required. Any existing gaps or weaknesses are specifically closed or eliminated through internal measures or with the help of external partners or the partner ecosystem. The decentralized teams also make their own decisions about this.
Agile Operating Model: Design Of The Organizational Structure
The changed organizational structure shifts a large part of the decision-making powers from central to decentralized agile teams. They communicate with one another and have interfaces to central functions such as finance or human resources. This enables high decision-making speed in the operational processes. And last but not least, there is scope for the planned continuous improvement of the teams to design the organizational structure.
“Companies close to the customer are flexible and have a decentralized organization prove to be superior regardless of their branch. You can react faster, more flexibly, and more innovatively to changing customer requirements and work more profitably by consistently concentrating on the value chain,” explains Dr. Finn Breuer, Executive Consultant and Head of Business Agility & Consulting at CGI. “When designing – or in most cases re-designing – the respective operating model, the five steps described can help to proceed in a structured manner. Ultimately, the goal is to get horsepower on the road as quickly as possible in competitive advantages. Of course, it helps if the location and size of possible potholes on the route are known in advance. “
Founded in 1976, the CGI Group is one of the largest independent providers of IT and business process services worldwide. With 77,000 consultants and other experts worldwide, CGI offers a broad portfolio of services – from strategic IT and business consulting through system integration, managed IT and business process services, to intellectual property solutions. With the principle of customer proximity pursued by CGI and a flexible delivery network, companies are supported in achieving success more quickly and digitizing their organizational structures.