How to create a target operating model (without overcomplicating it)
A target operating model sounds like something only big consulting firms talk about.
In reality, it’s much simpler.
It’s just a clear description of how your business should work so that your strategy actually gets delivered.
Not in theory. Not in slides. In real life.
If your team is busy but progress feels slow, or if decisions take too long, or if priorities constantly clash, the problem is often not the strategy.
It’s the operating model.
In this guide, we’ll walk through how to create a target operating model step by step, in a way that is practical, simple and actually usable.
What is a target operating model (in plain English)
A target operating model is a clear picture of how your organisation should operate in the future to deliver its goals.
It defines how people, processes and tools come together to make things work. [oai_citation:0‡bakkah.com](https://bakkah.com/knowledge-center/target-operating-model?utm_source=chatgpt.com)
Think of it like this:
- Your strategy is what you want to achieve
- Your operating model is how you actually make it happen
Without that “how”, strategy stays theoretical.
That’s why a target operating model acts as the bridge between ideas and execution. [oai_citation:1‡Ingentis](https://www.ingentis.com/en/knowledge/target-operating-model/?utm_source=chatgpt.com)
When do you actually need a target operating model?
You don’t need a target operating model for everything.
However, you do need one when things start to feel messy.
For example:
- Teams are working hard but not aligned
- Projects move slowly or get stuck
- Responsibilities are unclear or overlapping
- Decisions take too long
- New tools or initiatives don’t stick
If any of this sounds familiar, you don’t have a performance problem.
You have a structure problem.
The biggest mistake companies make
Most organisations approach this backwards.
They start with tools, org charts or processes.
But a target operating model should always start with one question:
“What are we actually trying to achieve?”
Because the operating model must follow the strategy, not the other way around. [oai_citation:2‡Wikipedia](https://en.wikipedia.org/wiki/Target_operating_model?utm_source=chatgpt.com)
How to create a target operating model (step by step)
1. Understand how things work today
Before designing anything new, you need a clear view of your current setup.
This means looking at:
- How work actually flows (not how it’s supposed to)
- Where decisions get delayed
- Where effort is duplicated
- Where teams depend on each other but don’t align
Most issues become obvious very quickly at this stage.
2. Define what “good” looks like
Now move from reality to ambition.
What should the organisation look like if things worked properly?
This is your target state.
At this point, keep it simple:
- What should be prioritised?
- What should be faster?
- What should be clearer?
- What should stop happening?
You’re not designing details yet. You’re setting direction.
3. Design the core building blocks
A strong target operating model always covers a few key elements:
- Processes: how work flows end to end
- Ownership: who is responsible for what
- Governance: how decisions are made
- Tools: what supports the work
- KPIs: how performance is measured
You don’t need complexity here.
You need clarity.
4. Align people, not just structure
This is where most target operating models fail.
You can design the perfect structure on paper.
However, if people don’t understand it, or don’t buy into it, nothing changes.
So instead of just defining roles, focus on:
- Who makes decisions
- Who owns outcomes
- How teams collaborate
Clarity beats sophistication every time.
5. Make it real (this is the hard part)
A target operating model is not the document.
It’s the way people actually start working differently.
This means:
- Introducing simple routines (weekly reviews, prioritisation, tracking)
- Using consistent formats for reporting
- Reinforcing ownership and accountability
- Adjusting based on what works and what doesn’t
This is where change management becomes critical.
Because designing is easy.
Adoption is everything.
What a good target operating model looks like
A good target operating model is not long or complex.
In fact, the best ones are surprisingly simple.
You should be able to explain it in a few minutes:
- How work flows
- Who owns what
- How decisions are made
- How performance is tracked
If it takes 50 slides to explain, it won’t be used.
Why this matters more than you think
Most organisations don’t fail because they lack ideas.
They fail because they lack structure.
Without a clear operating model:
- Teams stay busy but outcomes don’t improve
- Initiatives multiply but impact doesn’t scale
- Leadership lacks visibility and control
On the other hand, when the operating model is clear, everything accelerates.
Decisions are faster. Teams are aligned. Execution becomes predictable.
Final thought
You don’t need a “perfect” target operating model.
You need one that is clear, simple and used.
Because at the end of the day, the goal is not to design a better organisation.
It’s to help your current one actually work.
If this is something you’re currently dealing with, you might also find this useful: how we help organisations structure operations and delivery.