A business operating model is the combination of roles, skills, structures, processes, assets and technologies that allow any organisation to provide its service or product promises. In effect, it is the way the business is set up to deliver1.
The operating model of the organisation can be split in to 5 categories:
- Information systems
- Locations and buildings
- Organisation and people
- Suppliers and business partners
Process measures: these are measures of the effective delivery of process-based activity according to ideas of productivity, performance and efficiency. Process measures also an indication of the ability of the organisation to drive value from groups of activities.
Process efficiency = Value-added time / total time
Efficiency (transactional) = execution time / cycle time
Information systems measures: these are measures that describe the quality and effectiveness of the organisations information systems to deliver value to the organisation. These can include measures of system quality, information quality, use, user satisfaction, individual impact and organisational impact (see here for more information).
For instance an organisation can measure user feedback exploring:
Location and buildings measures: these are measures of the geography and dimensions of the buildings and sites used by the organisation.
Organisation and people measures: these measures are a summary of the human capital measures that can be used to describe the people in the organisation, selected at the discretion of the senior leadership team of the organisation.
Suppliers and business partner measures: these are measures of the quality and effectiveness of activity throughout the supply chain including immediate and distance partners of the organisation. Performance of the partnerships and supplier relationships include, price, total cost, service, on-time delivery, efficiency, and responsiveness.
For instance, measures of quality could be assessed by a survey that includes:
- Delivery against objectives
- Cost efficiency
- Responsiveness to enquiry