Target Operating Model Design
Introduction
To effectively and efficiently serve business strategy, supply chain activities need to continuously adapt to changing external conditions. Especially with turbulent global political conditions, new tariff regimes and trade barriers, shifts in customer expectations and the emergence of AI, there is a realization among many of our clients that they need to fundamentally re-think their supply chain, key activities within it, or even introduce completely new ways of working.
Immediate challenges in planning can be solved with continuous improvement, but the transition to a future-proof supply chain requires fundamental change. Companies need to embark in large-scale transformations to adapt to what is needed going forward.
| A Target Operating Model (TOM) defines the future state of your operations – how your people, processes, data, technology, performance management, and external ecosystem must work together to achieve strategic objectives. It provides a clear blueprint for transformation and sustainable value creation across the supply chain. At Miebach, we partner with clients to design and implement integrated TOMs that unlock agility, improve responsiveness, and enable measurable business outcomes. |
Relevance of the TOM
Why you need a holistic and integrated Target Operating Model for your supply chain activities
The Target Operating Model connects all the elements that determine how a supply chain actually works day-to-day. At Miebach, we differentiate between 6 key dimensions when designing the Target Operating Model for your Supply Chain activities: Processes, Organization, Data & Systems, Performance Management, People Management, and Industrial Footprint.
When these components are aligned, companies achieve:
- Consistent and integrated execution across markets, functions, and sites
- Faster, more reliable decision-making
- Clear roles, responsibilities, and governance
- Better performance management and transparency
- Smarter use of digital tools and data
- Higher service levels at lower cost
- Reduced firefighting and operational noise
- A more resilient, agile supply chain able to scale and adapt
Framework
What designing your Target Operating Model looks like
Two key design principles form the framework conditions under which we develop the Target Operating Model (TOM):
- Strategic embeddedness: The TOM must be anchored in the company’s strategy and serve to achieve the strategic value levers (e.g. agility, cost, service) of the company.
- Internal coherence & alignment: The elements of the TOM must be designed to work together seamlessly and in a way that each component supports and strengthens the others.
After considering the strategic context and overarching business and supply chain objectives, six dimensions guide the design of the Target Operating Model.
1. Processes – Design and optimize end-to-end workflows
We begin our design by looking at the processes necessary to effectively run the supply chain. They need to be defined and detailed out in terms of what is done, by whom, how, and when – ensuring transparency, standardization, and scalability.
2. Organization – Build the right structural foundations
Processes need to be embedded into a fit-for-purpose organizational structure.
We help you to define responsibilities, governance structures, and interaction models that enable efficient collaboration and decision-making. (see also our page on Process and Organizational Improvement as the core component of any supply chain improvement effort)
3. Data & Technology – Enable with intelligent platforms and insightful data
IT systems, execution- and decision support software as well as the underlying data are what enables your organization to execute processes.
We help you to define the required IT- and data architecture, functional requirements, analytics capabilities, and help you to select the best-fit vendor for specific support systems such as APS, TMS, WMS and so forth. While maintaining provider-neutrality, we leverage a strong network of partners to identify and implement the right digital solutions with one integrated team of process and technology experts.
Read more about Transportation Management Software
4. Performance Management – Turn performance insights into action
To ensure that supply chain and business outcomes are achieved, the Target Operating Model needs to include an embedded performance monitoring and management scheme.
We help you to define the right set of performance indicators and provide hands-on support in translating them into visual and interactive dashboards to make them actionable. Together with you, we establish review and control mechanisms and shape incentive schemes that drive target achievement without creating adverse or counterproductive behaviors.
5. People Management – Enable People to Own and Drive the Transformation
Your employees are your most valuable asset and critical for bringing any supply chain activity to life.
We help you define programs and routines that help to sustainably empower and motivate your employees. By providing tailored training, hands-on coaching, and structured capability development we help to set process participants onto a path of confidence, competence, and ownership.
Read more about Transformation Management
6. Industrial Footprint & Partners – Orchestrate the extended supply chain
Primarily, your internal network of production and distribution sites needs to be aligned with your market orientation and business strategy. Network redesign and footprint optimization initiatives are a recurring theme in our client engagements.
Read more about Transforming Supply Chain Planning
On top of that, a robust target operating model also needs to extend beyond organizational boundaries, shaping how we interact with suppliers, customers, and logistics service providers to enable coordinated, end-to-end execution. We help you to shape the interfaces with key supply chain partners and to strategically define specific contractual agreements, such as service levels, trading conditions, etc.
Capability Insights
The Miebach Difference
At Miebach, we help you to design a wholistic Target Operating Model for your supply chain that ensures that your supply chain is a decisive value creator for the business.
Why Miebach is the right partner for you
1. Strategic and operational expertise
We take pride in not stopping after concepts have been designed. We team up with you and provide hands-on support to implement and make sure that benefits are delivered.
2. Supply Chain experts across fields, industries, and geographies
We are able to leverage our global network of experts across the fields of strategy, engineering and digital to provide the diverse expertise needed for your large-scale transformation.
3. Strong change & transformation capability
With strong roots in engineering and operational implementations on the shopfloor, we understand and address what is needed to engage people and bring the TOM to life.
4. One-team collaboration
We work side-by-side with your teams, ensuring the TOM is realistic, adaptable, and delivers real value.
5. Driven by facts and figures
Through our engineering heritage, we validate our recommendations with deep field-knowledge about capabilities of both the operating technology (OT) and the information technology (IT) and how to bridge between the OT and IT worlds.
What can we help you with?