In the globalized economy, B2B companies face the challenge of adapting their digital offerings to international markets. Different market requirements and cultural peculiarities make it necessary to create flexible and efficient structures. This is where the Target Operating Model (TOM) comes into play, bridging the gap between strategy and operational implementation and supporting companies in successfully realizing their international ambitions.
What is a Target Operating Model (TOM)?
The TOM forms the organizational and functional framework for implementing a corporate strategy. It defines structures, processes, organizational forms, skills and working methods that are necessary to achieve strategic goals. A well thought-out TOM can lead to higher customer satisfaction, cost efficiency and faster time-to-market cycles.
Challenges of internationalization
Internationalization brings with it numerous challenges: individual market requirements, cultural differences and the question of centralized or decentralized control of measures are just some of them.
One example: While certain forms of promotion work well in Germany, a "Buy One Get Two" campaign might have more impact in the USA. Such differences require a flexible platform that can be used both centrally and locally.
Dimensions of the TOM
A comprehensive TOM takes three key dimensions into account:
Employees: Skills, methods and tools of collaboration and communication must be continuously developed.
Processes: Efficient and clearly defined processes are crucial for the successful implementation of strategies. This includes the optimization of workflows and synchronization between different markets.
Organization & governance: Roles, responsibilities and the organizational structure must be clearly defined and adapted to international circumstances. Overarching governance is necessary in order to make decisions.
Use cases of the TOM
The TOM is a versatile tool that can be used in various internationalization scenarios:
Independently operating countries: these act largely autonomously and require a TOM for local flexibility while central guidelines are adhered to. This helps to strike a balance between global standards and local adaptations.
Countries without their own organization: These require more support from the parent company. A TOM helps to provide standardized processes and support to ensure consistent quality and efficiency.
Countries with a different self-image: In the USA, for example, adjustments are necessary in order to meet the American understanding and local requirements. Here too, a TOM must strike a balance between global efficiency and local adaptation.
The importance of overarching governance
Overarching governance is essential to manage the complexity of international expansion and ensure that operational processes function effectively at both local and global levels. Centralized governance of platform components offers several advantages:
Coherence and consistency: centralized governance ensures that the corporate strategy is implemented uniformly across all markets. This helps to maintain brand image and customer trust worldwide.
Efficient resource management: Centralized control allows resources to be used and distributed more efficiently. Centrally developed features can be adapted to the specific needs of local markets, saving time and costs.
Faster decision-making: Clear responsibilities and roles enable faster decision-making processes. Problems can be identified and solved more quickly, which is particularly important in dynamic markets.
Better scalability: A well-defined governance structure makes it easier to scale best practices and successful processes to new markets. This promotes global expansion and market entry.
Clear allocation of roles and responsibilities: Clear definitions minimize misunderstandings and ensure that everyone involved knows and fulfills their tasks.
Global and local balance: Central governance helps to strike a balance between global standards and local adaptations. Some features and processes are standardized globally, while others are adapted to local requirements.
Conclusion
A well thought-out target operating model can help B2B companies to achieve their international goals. It enables a coordinated and efficient structure that takes both local and global requirements into account. In an increasingly interconnected world, a TOM is the key to sustainable success and competitiveness on an international level.
A well thought-out governance structure supports scalability, consistency and efficiency and is therefore an essential component of a successful Target Operating Model.
Would you like to find out more about your individual options?
Would you like to find out more about how a TOM can help your company to be successful internationally? Our experts will be happy to assist you with the development and implementation of a customized model.
