Many businesses in Asia struggle with designing and implementing Target Operating Models (TOMs). Challenges like low IT investment, fragmented structures, and outdated models hinder efficiency and growth. However, companies that embrace data-driven strategies, decentralization, and restructuring are seeing significant improvements. Here’s a look at Asia Target Operating Model Strategies across Asian markets.
The Need for IT Investment in Asia
A leading global bank allocated a low percentage of its IT budget to Asia despite the region’s massive market potential. This misalignment created competitive risks, showing that businesses must prioritize IT investment to stay ahead.
With digital transformation shaping industries, firms must allocate resources effectively to strengthen their target operating models. A well-funded IT strategy can improve efficiency, security, and innovation, helping companies scale operations successfully.
Decentralization: The Future of Asia Target Operating Model Strategies
Asian businesses are moving away from centralized models and embracing decentralized structures. This shift allows regional hubs to make faster decisions, respond to market changes, and reduce operational costs.
Cost pressures and the need for localized strategies are driving this transformation. By allowing business units to operate independently, companies can increase agility and improve market responsiveness.
Leveraging Data-Driven Strategies
Organizations that integrate data-driven strategies into their TOMs enhance performance and transparency. In the asset management sector, firms using real-time market data have optimized operations and met regulatory requirements more efficiently.
Data-driven decisions reduce inefficiencies, helping companies scale while maintaining compliance. Investing in data analytics and automation can improve strategic planning and operational execution.
Restructuring for Profitability: A Success Story
Companies that realign their TOMs around core competencies see major benefits. General Electric (GE) successfully restructured, focusing on its core strengths, which led to a 16% increase in industrial profit margins within two years.
This proves that a well-structured TOM can improve efficiency and profitability. Organizations must regularly evaluate and refine their operating models to stay competitive.
Read Also: Navigating the Future: The Role of Target Operating Models in Asia’s Business Transformation
Challenges of Asia Target Operating Model Strategies
Despite its benefits, TOM implementation in Asia faces several hurdles. The Asian Development Bank (ADB) struggled with an outdated model that fragmented expertise across departments. This hindered productivity and innovation.
Businesses must avoid such pitfalls by ensuring a cohesive strategy when implementing TOMs. Aligning technology, talent, and operations is key to sustained growth and efficiency.
The Role of the Private Sector in TOM Success
Asia’s private sector is a major driver of economic growth, generating jobs and tax revenues. Effective TOMs support business expansion and market stability.
With increasing competition and regulatory changes, companies must adopt flexible and scalable operating models. Investing in IT, decentralization, and data analytics can help firms adapt to market shifts and drive long-term success.
Read Also: Unlocking Southeast Asia’s Digital Finance Future: Opportunities and Challenges Ahead
A Smarter Approach to Asia Target Operating Model Strategies
Implementing effective Asia Target Operating Model Strategies requires a strategic mix of IT investment, decentralization, and data-driven decision-making. Companies that prioritize restructuring and operational efficiency will stay ahead in Asia’s evolving market landscape. By learning from past challenges and embracing proven strategies, businesses can build resilient and scalable TOMs that drive success across Asian markets.
