TOM – Target Operating Model

The Blueprint for Transitions

If you’ve ever been part of a transition such as a carve‑out or merger, you’re likely familiar with the concept of a Target Operating Model. And you’ve probably also seen a sudden surge in attention for Business Process Management and Enterprise Architecture. Why do these disciplines become so critical at that exact moment, and how do they actually intervene?

The Target Operating Model - Definition

A Target Operating Model (TOM) is a structured blueprint that describes how an organization will operate in the future after a planned transition. It translates strategy into practical design by defining the processes, capabilities, structures, technologies, and governance needed to deliver the desired outcomes.

Ideally, a high‑level Target Operating Model (TOM) is already in place before any strategic acquisition is made. It provides the foundation for estimating cost, timeline, and feasibility, and it enables early synergy assessments. With a clear high‑level TOM, you can quickly evaluate how well a potential target fits the intended operating model and where value can be created.

After all, it’s far easier to identify synergies between two e‑commerce companies selling Home & Garden products than between a pet‑shop retailer and a software company. The TOM gives you the lens to judge whether an acquisition is a natural extension of the operating model or whether it requires disproportionate adaptation.

But the timing of a more concrete TOM depends on the context of the company. Reality does not follow theory, or at least we have to diversify the theory based on practice.

Concretisation of the TOM - When

So when is the right moment to create a more concrete TOM? In practice, the timing depends heavily on the maturity of the organization and the type of integration being executed. There’s a clear distinction between one‑off or first‑time integrations and the more mature buy‑and‑build environments.

In a one‑off or first integration, the entire deal and integration process is new for the organization. As a result, the TOM is often created together with the acquired company or adjusted to fit its reality. The process is less structured, more exploratory, and heavily influenced by what is discovered during due diligence and early integration planning. In these cases, the TOM evolves organically because the organization is still learning what its future operating model should look like.

In contrast, a mature buy‑and‑build portfolio typically has a predefined high‑level TOM before any acquisition is made. This TOM acts as a blueprint for evaluating targets, estimating synergies, and planning integrations. Once a deal is signed, the TOM can be quickly refined into a more concrete, detailed version because the foundational design already exists. The result is a faster, more repeatable, and more predictable integration process.

Define - Integrate/Onboard - Optimize

During one transition I kept hearing the mantra “Integration before optimization.” The idea was simple: don’t set the bar too high, prioritize getting the target onboarded, and worry about quality improvements later.

But in some situations, something needs to come before integration: Define.

A more realistic sequence in certain transitions is therefore:

Define (together) → Integrate/Onboard → Optimize

This is especially true in cases where there is no existing process to integrate into at all. For example, immediately after a carve‑out where people, systems, or core processes were not transferred with the business. In those situations, you cannot integrate the new entity into the existing organization because there is no operating model to integrate into yet.

You first need to design the process together with the target or the new shareholder. Only once the basic operating model is defined can you actually onboard or integrate the entity. And once you are “in the same boat,” you can start optimizing and professionalizing the process.

In other words: When the foundation doesn’t exist, you must build it before you can connect anything to it.

Business Process Management and Enterprise Architecture

Every transformation benefits from solid Business Process Management and a clear Enterprise Architecture as part of the Target Operating Model. But it’s crucial to focus on the essentials before investing heavily in BPM. There’s little value in documenting or optimizing processes when no accountable process owner exists to maintain, govern, and improve them. In such cases, keep it high‑level and work with Value Streams instead.

BPM is a powerful asset in a buy‑and‑build strategy, where repeatability and scalability matter. Yet even in that context, it requires strong executive sponsorship to be successful. Without leadership commitment, BPM risks becoming a documentation exercise rather than a driver of operational excellence.

The TOM as the compass

Ultimately, a Target Operating Model is not a theoretical exercise but a practical instrument to guide real‑world transitions. Whether you are integrating for the first time or scaling a mature buy‑and‑build strategy, the TOM provides clarity, direction, and a shared language for decision‑making. When used thoughtfully, it becomes the compass that keeps the organization moving forward: structured where needed, flexible where reality demands, and always anchored in creating sustainable value.