What Do We Mean by a “Dynamic” Operating Model?
A dynamic operating model has three defining characteristics. It:
separates what must be stable from what must be adaptable
enables rapid reconfiguration of work—not people
is managed as a product, not a one-time design
This means:
Strategy can shift without rewriting job descriptions
New services can be launched without new org charts
Capacity can move without months of approval cycles
The key point for today’s episode is you do not design a dynamic operating model -- you plan for its continuous development.
Step One: Anchor the Model in Outcomes, Not Structure
The first mistake organizations make is starting with structure.
Who reports where.
Which division owns what.
Where digital or CX should “sit.”
A dynamic operating model starts somewhere else entirely: outcomes.
Your plan must begin by answering three questions:
What outcomes matter most to the people we serve?
What outcomes matter most to the organization?
Where are those outcomes currently constrained?
In government, this might be:
Time to decision
Ease of compliance
Quality of service recovery
In enterprise, it might be:
Speed to market
Cost to serve
Retention and loyalty
Your operating model exists to reliably produce outcomes under changing conditions.
If the outcomes are unclear, the model will always be sketchy.
Step Two: Identify the “Fixed Spine” of the Organization
Every dynamic operating model has a stable foundation.
This includes:
Core governance
Financial controls
Risk management
Legislative or regulatory obligations
Enterprise platforms and data foundations
Your plan must explicitly document:
What cannot change frequently
What should not change frequently
This is not a limitation—it’s an enabler. When people know what is fixed, they are far more comfortable adapting everything else. Dynamic organizations are not chaotic. They are clear about their non-negotiables.
Step Three: Design for Flow, Not Functions
The third element of your plan is shifting how work is organized.
Traditional operating models organize around:
functions
programs
channels
Dynamic operating models organize around value flows.
That means:
End-to-end journeys
Products and services
Capabilities that cut across silos
Your plan should define:
The major value streams that deliver outcomes
The capabilities required to support those streams
How those capabilities are shared, not duplicated
This is where agility actually comes from—not from agile ceremonies, but from reducing handoffs and ownership ambiguity.
Step Four: Build an Evolution Roadmap, Not a Target State
This is the most important shift.
Static operating models aim for a “future state.”
Dynamic operating models plan for perpetual evolution.
Your plan should include:
A 12–18 month evolution roadmap
Clear hypotheses about what changes will unlock value
Lightweight governance for testing and adjusting
Think in terms of:
“If we change this capability…”
“If we move ownership here…”
“If we standardize this platform…”
Then measure, learn, and adapt.
A dynamic operating model is never finished.
To wrap
Developing a dynamic operating model is not a design exercise—it’s a leadership commitment.
It requires leaders to:
Let go of false certainty
Reward learning, not just compliance
Invest in capability, not just capacity