The Forces Driving Process and Operating Model Changes

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I keep a checklist of the technology trends to think about when redesigning processes or operating models. Things like "automation" or "digitization" or "mobility" or "social media". I am always trying to improve my checklist, which led me to two recent articles listing trends to think about, one from BCG and one from McKinsey.

The BCG report "Twelve forces that will radically change the future of work" by Vikram Bhalla, Susanne Dyrchs and Rainer Strack has five trends that seem to be about operations (the other seven are about changes in customer desires or the workforce). The five are:

  • Automation: nearly half of all jobs in the US can be automated 
  • Big data and advanced analytics: 2.5 quintillion of data are generated every day 
  • Access to information and ideas: 7.6 billion people will be using mobile devices 
  • Simplicity in complexity: 74% of managers believe that complexity is hurting performance 
  • Agility and innovation: 90% of managers say that agility is needed to execute strategy 

The McKinsey article "The Next Generation Operating Model for the Digital World" by Albert Bollard, Elixabete Larrea, Alex Singla and Rohit Sood only has five trends. The five are:

  • Lean process design: streamline processes and eliminate waste 
  • Digitization: digitize both customer experience and day-to-day operations 
  • Business process outsourcing: drive the next generation of outsources and offshoring 
  • Advance analytics: provide intelligence to facilitate decisions 
  • Intelligent process automation: to replace human tasks 

What should we take away from these two authoritative sources? First, neither includes the big fad of the last five months Artificial Intelligence (although it underpins two or three of the McKinsey list and two of the BCG list). Second, there are some notable similarities and differences. Both include automation and analytics. BCG has access to information, agility and simplicity. McKinsey has lean, digitization and outsourcing.

Using these stimuli and my own experience working on processes and operating models (see www.operatingmodelcanvas.com), I have recently adjusted my list. The acronym is a bit of a mouthful - ALODSAMOSA - but it has an earthy quality, once you have said it two or three times.

  • Automate (including artificial intelligence) 
  • Lean 
  • Outsource 
  • Digitize (both the customer interface and operations) 
  • Socialize (take advantage of social media) 
  • Analyze (collect big data with sensors and analyze) 
  • Mobilize (enable people to work anywhere) 
  • Offshore 
  • Simplify (cut complexity) 
  • Agilify (reduce the time it takes to change) 

The question to ask of any process or any operating model is "Could we do a better job of exploiting the trends of ALODSAMOSA?" If we are not thinking about how to use these trends to improve our operations, we are probably falling behind our competitors in quality or customer satisfaction or cost.

What additional or different items would you suggest? What about printed manufacturing? What about "environmentalize"? What about dignity at work? And then there are age old concepts such as "specialize" or "empower" or "align". Andrew Campbell is author of ten books including "Operating Model Canvas: Aligning Operations and Organization with Strategy". He runs executive courses at Ashridge Executive Education.

Andrew Campbell is author of ten books including "Operating Model Cancal: Aligning operations and organization with strategy." He runs executive courses as Ashridge Executive Education. He blogs at www.ashridgeonoperatingmodels.com.

Comments

Eamon Croke
,
posted 12 weeks 1 day ago

Great list, Andrew. From a

Great list, Andrew. From a technology perspective, I agree that AI / Cognitive is rapidly impacting operating models and this is enabling new capabilities, going far beyond mere automation.The shift from on-premises to cloud computing is also enabling dramatic changes to operating models. Blockchain / distributed ledger technology is clearly the next big thing and is already disrupting traditional models, particularly in financial services. All of these trends are having a big impact on processes, structures, staffing and skills, as well as the overall ecosystem.
Clive hardisty
,
posted 16 weeks 3 days ago

Nice Andew, a great reminder

Nice Andew, a great reminder to keep this in front of mind. I use the old Pestel and Porters 5 forces for the big picture coupled with Smacie and freump from ISO. Yes, it's too much. There some cross over so it reminded me it's time to come up with a better more efficient acronym. Nothing like sharpening our own process. Thanks for the tip. ALODSAMOSA, very catchy. ;)

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