Operating Models - Introducing the Management Operating System
In the third of a series of blogs on Operating Models, we answer with the question: “What’s a Management Operating System in the context of the Operating Model?”.
The relationship between an Operating Model and a Management Operating System (MOS) can be understood in terms of their scope and function within an organisation. Both are critical components of a company's framework for executing strategy, but they operate at different levels and serve distinct purposes.
As we’ve discussed in previous blog posts, an operating model defines how an organisation structures and operates to deliver value. It encompasses the alignment of resources, processes, and technologies to the strategic goals of the business. Key pillars of an operating model typically include:
Structure & Governance – hierarchy, reporting lines, division of labour
Culture – values, beliefs, behaviours
Processes – activities and workflows to generate value
People and Capabilities – recruitment, training, performance management
Technology and Information Systems – enabling innovation and agility
The operating model provides a blueprint for how different parts of the business work together to execute the company's strategy, and it often manifests as policies, workflows, and standards that govern daily operations.
Management Operating System (MOS)
A Management Operating System refers to the specific set of tools, processes, and behaviours used by management to ensure that an organisation meets its strategic goals. It is a collection of practices that enable leaders to plan, execute, monitor, and improve upon the organisation's performance. Key components of a MOS include:
Performance metrics and key performance indicators (KPIs)
Decision-making frameworks
Communication channels and reporting structures
Scheduling and resource allocation processes
Continuous improvement methodologies (e.g., Lean, Six Sigma, Agile)
The MOS is about translating the strategic intent and the structure provided by the operating model into actionable and measurable management activities. It provides managers with the mechanisms they need to steer the organization, make adjustments in real-time, and drive change where necessary to achieve desired outcomes. It can be thought of as the underlying system that enables a continuous improvement culture within an organisation.
Relationship between the Two
The business operating model is broader and sets the stage for the organisation's overall approach to doing business. It lays out the configuration of an organisation's resources and processes in line with strategic objectives. In contrast, the management operating system is a subset of the operating model focused on the day-to-day execution of operations, governed by the overarching principles and guidelines of the operating model.
The relationship can be summarised as follows:
The business operating model provides the framework and structure within which the organisation operates.
The management operating system provides the tools and processes through which this framework is managed, monitored, and continually improved.
For a company to be effective, its management operating system must be closely aligned with its business operating model; the MOS translates the broad principles of the operating model into concrete management actions that lead to the achievement of strategic goals.
In our next blog on Operating Models, we intend to bring the Management Operating System to life - to show you how our clients drive safe, repeatable, operational performance through it.
