In the world of business, the term ‘Ops Model’ is often used to describe the structure and processes that an organisation uses to deliver value to its customers. There are two main approaches to designing an Ops Model – aligning it to output or aligning it to outcomes. While both approaches have their pros and cons, it is important to understand that the choice you make will have a significant impact on how you deliver value to your customers.
If you choose to align your Ops Model to output, you will focus on producing tangible products or services that can be measured in terms of their size or quantity. For example, if you are a software development company, you might measure your output in terms of the number of lines of code you produce or the number of features you add to your product. While this approach is relatively straightforward, it can lead to a narrow focus on the process of production rather than the outcomes that your customers actually care about.
On the other hand, if you choose to align your Ops Model to outcomes, you will focus on delivering value to your customers by achieving specific business objectives or solving particular problems. For example, if you are a healthcare provider, you might measure your outcomes in terms of the number of patients who recover from a particular illness or the reduction in hospital readmissions. While this approach requires a deeper understanding of your customers’ needs and desires, it is ultimately more customer-centric and can lead to greater success in the long run.
Once you have chosen your approach, the next step is to work on improving how you work in order to deliver better output or better outcomes. This is where the concept of OKRs (Objectives and Key Results) comes in. OKRs are a framework for setting goals and tracking progress towards those goals. They are typically used in agile software development environments, but they can be applied to any business or organisation.
The key to setting effective OKRs is to ensure that they are aligned with your overall business objectives and that they focus on delivering value to your customers. For example, if your Ops Model is aligned to output, your OKRs might focus on increasing the efficiency of your production process or reducing defects in your products. If your Ops Model is aligned to outcomes, your OKRs might focus on improving customer satisfaction or increasing the number of successful outcomes achieved.
Regardless of which approach you choose, it is important to put a value on each work item in order to measure its effectiveness. If you are aligning your Ops Model to output, this value will be relatively easy to determine – it will be some denomination of size, such as the number of units produced or the amount of revenue generated. However, if you are aligning your Ops Model to outcomes, determining the value of each work item becomes more complex. You must ask yourself the question, “What is valuable to my enterprise?” This requires a deep understanding of your customers’ needs and desires, as well as the broader market trends and competitive landscape.
Unfortunately, many large corporates struggle to determine what is truly valuable to their enterprise. They may focus too much on the process of production and lose sight of the outcomes that truly matter to their customers. This is where OKRs can be especially valuable – by providing a framework for setting goals and measuring progress, they can help organisations quickly identify when their Ops Model is not aligned to delivering value.
In conclusion, the choice of whether to align your Ops Model to output or outcomes is an important one that will have a significant impact on how you deliver value to your customers. By setting effective OKRs and putting a value on each work item, you can ensure that your efforts are focused on delivering the outcomes that truly matter to your customers and your enterprise.
