Operating Model Design Q&A with Danielle Sheffler

1. Can you tell us a bit about your role at Versent and how you became involved in Operating Model Assessments and Design?

I lead the customer strategy practice, which is responsible for operating model assessments and design, change management, transformation readiness reviews and business case and financial modelling. My focus is on making sure that our clients’ technology transformations are supported by business transformation.

When a business transformation occurs, you almost always need to change the tech. Conversely, as tech changes, you need to also focus on the business transformation.

It’s hard to pinpoint how I got involved in this type of work. I think it just evolved naturally. Earlier in my career, I was a program manager who also focused on product and was working on reviewing and adjusting delivery practices, team structure and culture, tech strategy and implementation, and metrics. So, I was doing operating model assessments and design informally. Then three to four years ago, I started to do more formal assessments.  

2. What exactly is Operating Model Design, and why is it important in today’s tech landscape?

Operating Model Design is about understanding how a business actually runs across its people, processes, technology, data, and culture, and then shaping those components so they work together to deliver the strategy. Any time an organisation is uplifting capabilities, whether it’s cloud, data, AI, engineering, or business practices, it’s important to look at the foundational enablers like technology, data, and culture first. Those enablers determine what is possible, where the constraints are, and what needs to shift to support the change.

From there, Operating Model Design looks at structures and teams, decision-making, metrics, governance, and ways of working and how they all integrate. It helps clients understand the impacts of the changes you’re proposing and what needs to happen to ensure the business operates successfully.

As for why this is important, the pace that tech is moving has accelerated with AI and organisations want to move quickly to implement new technologies. It’s tempting to just focus on the rollout of the new tech without paying attention to the effect of this on employees, roles, behaviours, day-to-day ways of working, and customers. When a business does not focus on these elements, it can be hard to make the transformation stick.

3. What are the kinds of challenges that customers typically face when they come to Versent for help in this area?

Businesses often approach us because they’re not seeing the efficiency and results they wanted to see; it could be that their time to market or time to realise value is longer than it should be, or their spend is too high and they’re not getting the ROI that they’d expect out of the products they have or the processes in place.

These issues are often caused by unclear roles, duplicated or overlapping responsibilities, fragmented decision-making, and/or inconsistent ways of working across teams. Other times the foundations like tooling, governance, culture, skills, or delivery practices haven’t kept up with the pace of the business.

We create a fit-for-purpose evaluation to understand what is and isn’t working and create an executable rollout plan to assist them in how to successfully roll out any changes.

4. How do Operating Model Assessments help customers align their teams with business outcomes or transformation goals?

It really depends on what the organisation is looking to achieve. You don’t need to look at the whole organisation right away. You often start at the department level and understand the interactions and touchpoints they have with the rest of the company. Doing so is a great way to work out what works and what doesn’t before you expand too far.

Versent helps customers connect their strategy and their organisation’s goals to how they operate day-to-day. We look at their technology, their data, their people, their processes, and their culture and how that ladders up to their outcomes.

We then pair the operating model work with change management. This is key, as it means the organisation brings the customers and the employees along for the ride. It gives stakeholders confidence in the changes and validates that the business is moving in the right direction.

You need that communication and engagement to happen and to ensure it’s happening concurrently with the operating model for a successful business transformation.

5. Can you highlight a recent example where an Operating Model Assessment made a tangible difference for a client?

We recently completed a six-week Operating Model Assessment for a customer whose Software Development Lifecycle (SDLC) was fragmented and inefficient. They were also interested in adopting an AI and DevSecOps-enabled SDLC. Whilst they had a strong team and solid technical capability, the time to market was taking longer than expected.

As we looked deeper, evaluating the technology, the ways of working, and handoffs, we continued peeling back the layers and discovered that the core issues were not just around the tools or DevSecOps practices. The real constraint was around a lack of clarity of roles, inconsistent communication between teams and a structure and set of processes more suited to a project operating model rather than a product operating model.

We recommended six core operating model shifts related to Agile ways of working, quality management, collaboration models, a modernised engineering platform and developer experience, data-driven decision making and continuous learning, and a move to a product operating model. We didn’t just leave the client with a high-level roadmap. Our team co-developed an actionable plan with very specific work packages that included foundational steps for the first six months, what to build on in the following 6-12 months and then what to mature in 12-24 months and beyond.

Transformations of this size can be overwhelming, so it was important that the customer not try and do everything at once. Instead, this plan allows them to make small, iterative changes that have a big impact, to figure out what works and what needs to change.

In the next few weeks, the client will be kickstarting the transformation, using the plan we co-developed with them.

For this project, Versent had a mix of technologists, a service designer to ensure we took a human-centred design approach, and an operating model strategist. On the client side, we engaged with Engineering Leads, a Project Manager, and a Business Analyst and conducted workshops and interviews across security, engineering and architecture, change management, project management, product management, and finance to ensure we had a holistic view of the organisation and an operating model that was realistic and owned by the people it would impact.

6. What frameworks or methodologies do you draw on in your modelling work?

We use a structure that’s built on well-known operating model principles. The customer sits at the centre, and then we look at the foundations of technology, data, and culture, and how those support the organisation’s strategy. From there, we look at things like ways of working, structure, governance, capabilities, processes, and how value actually moves through the organisation.

On the change management side, we usually draw on PROSCI or ACMP, depending on the client. We don’t apply them in a very rigid way though. We’re flexible based on what the client needs.

7. How do you balance the human side of organisational change with the technical or structural aspects?

That’s really where change management comes in and why we use a co-development process. We want people to feel like change is happening with them, not to them.

We don’t want to be the type of consultants that come in and tell people what to do. Rather, we want to listen and ensure we’re understanding what people within the organisation are doing day-to-day. That way, we can take in what frustrates them, what’s working for them – what to keep. In doing so, their voices are amplified, they’re part of the change process and the proposed changes are based on how the organisation actually operates.

The other part is encouraging the organisation to develop methods and a cadence for regularly getting customer feedback, and ensuring the engineers are part of those sessions.  It’s important for them to hear customers’ needs, wants, goals, and pain points directly from them. This helps the engineers involved to feel connected to the ultimate outcome and remain mindful of how the implementation can affect the end customer.

8. Are there any tools or visualisations you find particularly powerful when helping clients understand their current state vs. future state?

Recently we used a visualisation with an SDLC uplift project to help the client understand the impact that various pillars could make in their transformation. It showed that the proposed changes to the tooling, technology, and processes in their SDLC would get them to 30% of their desired outcome. Another 30% would come from uplifting their ways of working. While 60% of a transformation would help them make positive movement, the visualisation showed that some of their biggest change to value – 40% of their transformation – would come from moving from a project operating model to a product operating model. This mapping helped the client set realistic expectations and scope their transformation work accordingly.

With both PROSCI and ACMP, there are some quite powerful models and visualisations that help teams see when to bring people into the change, where resistance might show up, and what adoption is likely to look like. These help organisations visualise and have more clarity around what’s really needed to support and achieve a successful transformation and where changes need to occur in their operating model.

9. Have you noticed any emerging trends in how organisations are thinking about structure, capability, or agility?

If I had to say that I’m seeing one thing when it comes to structure or one thing with capability across all organisations, I wouldn’t say there’s a single trend that applies everywhere. A lot depends on the organisation’s culture and the experiences they’ve had in the past.

In saying that though, many organisations are trying to run a bit leaner, which does make sense in some areas and can create focus. However, it’s important to not overcorrect and expect people to cover too many areas of responsibilities, and we’re definitely seeing quite a bit of that. In this goal of streamlining, some organisations are forgetting that there are specific areas of expertise, with depth and breadth, that are very valuable for teams. And so, what we’re seeing is that organisations may be having their engineers work in their daily roles but also play the roles of solution architect, project manager, and product manager. Not only are there very few people who actually have the expertise to do all those roles, but it also often leads to burnout and actually ends up slowing down delivery time and quality.

Not surprisingly, AI-assisted work is another trend. It’s not about replacing people with AI but rather how teams can use AI to build efficiencies and free people up to spend time on tasks that AI is not capable of. So, we’ll see more AI assisted code reviews, more automation in QA, and more opportunities for high-value creativity and innovation.

So overall, my hope is that organisations approach streamlining in a thoughtful and intentional way, and that AI is used to enhance creativity, innovation, and efficiency rather than simply as a substitute for people.

10. Where do you see the future of Operating Model Design heading, especially in the context of AI, cloud, and digital transformation?

There’s so much focus right now on modern engineering and the ways to use AI to speed up development but it’s important to remember that the business needs to be able to keep up with that pace.

A team could utilise AI to suddenly get through 25 items on a roadmap in the time it used take the team to finish five, but you will still need the people, processes, and governance to review and act on that work.

So, I see the future of operating model design is going to be about the balance between the speed of technology and the speed of human decision-making. That includes reviewing the new skills and roles needed in the workplace, revising team composition, creating and reviewing governance policies and structures, and determining how teams collaborate.

Organisations will need to ensure that they have the foundational elements in place – from data and tech to culture, skills, and governance – to keep up with the pace of AI, cloud, and modern engineering and ensure the value actually lands for the business, its employees, and its customers.

11. What’s the most surprising thing you’ve learned through this work?

One of the most surprising things I’ve learned is how often people focus on either the technology or on the business and not both. Sometimes, organisations are so committed to changing something in the business that they overlook the technology implications. And, conversely, others become so focused on upgrading or changing technology that they forget to consider the wider business, the operating model, and the effects those tech changes create.

I’ve also seen that it’s very natural to look at a problem area and really delve into the technology behind it and think that by fixing that, it will solve the issue. But it’s often not one area in isolation that was causing the issue. For example, if code reviews are taking days before code gets pushed through, maybe improving the technology will help but it won’t solve the problem if the issue is capacity, knowledge gaps, or ways of working issues.

The other big learning is that businesses don’t always see the value in taking the time to get the perspectives of team members across all levels of the organisation and not just leadership. I definitely understand how easy it is to slip into that thinking when you have a limited amount of time and budget for an engagement. However, the team members on the ground that deal with the issues day in and day out often have some of the clearest views of what’s going on in the organisation. So having the insights and the perspectives of team members from C-Suite through to the person who recently graduated uni paints a much more thorough and accurate picture of how the business operates. At the end of the day, business operations affect everybody in the business, so it’s important to get as many insights from as many people and levels as reasonably possible.

12. If you could give one piece of advice to a business leader looking to reshape their organisation, what would it be?

Keep it people-centric. You can change the technology and change the process but without focusing on the people and getting them involved early in the change process, they’ll feel like the change is something that’s done to them, rather than with them. And when that happens, it’s going to very difficult to get the change to stick. The more employees (and customers) feel informed and involved, the more successful the transformation will be.

At Versent, we don’t just focus on the strategy and leave you with a high-level roadmap. Nor do we drill deep into the technology and forget about the strategy. Instead, we take a holistic approach that encompasses both, along with change management to help your teams evaluate what they’ve got now, where they want to go and how we can help get them there.

If you’re looking to do a partial, or whole of business transformation, we’d love to work with you. Click here to contact our team.