Every nonprofit has an operating model, even if it is not named as such. It describes where and how critical work gets done to achieve an organization’s goals. For many nonprofits, operating models evolve by default over time rather than through explicit discussion and choices. Top performing nonprofits, however, make intentional choices about their operating models to ensure they act as a bridge between strategy and execution. Building this bridge well requires tailoring the operating model to support the organization’s “must-get- right” decisions and capabilities—those that are necessary for the strategy to succeed.
Bridgespan’s operating model framework includes four interrelated elements (see chart below):
- Structure and accountabilities describe where key work is done and who does it. Structure identifies key operational units, typically reflected in an organization chart, as well as the cross-cutting services and coordinating mechanisms that allow for collaboration and expertise sharing across them. Accountabilities specify roles and responsibilities, and clarify decision rights for issues that cross units.
- Management systems are the ways the organization prioritizes, guides, and monitors its work. These include the executive forums, managerial processes, and metrics that support high-quality decision making on strategic priorities, resource allocation, talent deployment, and performance management. This operating model element also extends to board-related considerations, such as its composition, governance practices, and interactions with the nonprofit’s leaders.
- Ways of working captures how leaders guide their teams, and how colleagues behave and interact with one another. These are the cultural norms that go beyond broad values, such as trust and respect, to get explicit about how teams will collaborate across functions or geographies and where they will adopt innovative working practices such as Agile. Establishing the organization’s dominant decision-making style—whether consensus, democratic, directive, or participative—sets an important context for behaviors. Many organizations find that their key challenges have more to do with the way people work together—or fail to do so—than with structures or management systems.
- Enablers support key capabilities and optimize performance across the other elements of the operating model. They include recruiting and talent development, data and technology, expertise in critical areas, learning and innovation, and supports to ensure that critical partnerships with other organizations are successful.
All operating models take shape around this framework of four elements, but each model is different. That’s because no two organizations—even if they seek to address similar issues— have the same approach to impact, funding model, strategic priorities, geographic scope, or cultural and leadership profiles. And this means that their “must-get-right” decisions and capabilities that animate and serve a cohering function for the operating model’s four components will also differ, requiring tailored operating model choices to unlock impact.
Read the full article about operating models by Marcia Blenko, Leslie MacKrell, and Kevin Rosenberg at The Bridgespan Group.