Operating Model Rewiring for Executive Growth
The most consequential strategic question facing C-suite executives heading into 2026 is not where to cut costs or which technologies to adopt—it is whether the organization’s fundamental architecture can support the growth ambitions on the table. Operating model rewiring has emerged as the defining discipline for leaders who recognize that incremental optimization has reached its ceiling. When the structure itself is misaligned with strategy, no amount of process improvement or performance management will close the gap. The organizations pulling ahead are those whose executives have had the courage to redesign decision rights, resource flows, and accountability frameworks at the same time—not sequentially, not partially, but as a unified structural intervention.
Why Incremental Optimization No Longer Delivers
For the better part of the last decade, most large organizations pursued efficiency through familiar levers: lean methodologies, shared services consolidation, zero-based budgeting cycles, and technology-enabled automation. These efforts produced real returns, but they operated within the existing organizational logic. The reporting lines, approval hierarchies, and resource allocation mechanisms remained largely intact. What executives are now confronting is a fundamental exhaustion of those returns.
The reason incremental optimization stalls is structural, not motivational. When cross-functional teams cannot make consequential decisions without escalating to senior leadership, speed erodes regardless of how streamlined the underlying processes become. When annual budgeting cycles distribute resources according to historical patterns rather than strategic priorities, the best ideas die in the queue. When accountability for enterprise outcomes is diffused across functional silos, no single leader owns the full picture—and results suffer accordingly.
The organizations that will define competitive advantage through 2026 and beyond are those that have diagnosed these structural constraints honestly and committed to something more fundamental: a genuine rewiring of how the organization makes decisions, moves resources, and holds itself accountable. This is not a transformation program in the conventional sense. It is an architectural intervention, and it requires the CEO and board to be active principals, not passive sponsors.
The Core Dimensions of Operating Model Rewiring
Executives who have successfully led operating model rewiring initiatives tend to work across three interconnected dimensions simultaneously. Addressing any single dimension in isolation invariably produces incomplete results, because these elements are deeply interdependent. A change in decision rights without a corresponding shift in resource allocation simply transfers the bottleneck. A redefinition of accountability without clarity on who owns which decisions creates confusion rather than empowerment.
Decision Rights: Clarity at Every Layer
The most common structural pathology in large organizations is decision authority that is ambiguous, over-centralized, or misaligned with where relevant information actually resides. In a world of accelerating market change, organizations that require senior leadership involvement in operational and tactical decisions are systemically slower than those that have pushed genuine authority closer to the customer and the work.
Effective operating model rewiring begins with a rigorous audit of who actually makes which decisions today—not what the org chart implies, but what observation and interview data confirm. The results are frequently surprising. Decisions that should be made at the business unit level routinely require corporate sign-off. Decisions that carry significant strategic risk are being made informally, without appropriate governance. Clarity on decision taxonomy—distinguishing between decisions that must be made at the enterprise level, those that belong to business units, and those that should be fully delegated to teams—is the foundation on which everything else is built.
The practical tool most useful here is a structured RACI-plus framework that not only specifies who is Responsible, Accountable, Consulted, and Informed, but explicitly captures the escalation thresholds and decision speed expectations for each category. When leadership teams work through this exercise with discipline, it surfaces both over-centralization and accountability gaps that have been hiding in plain sight.
Resource Allocation: Moving Capital at the Speed of Strategy
Traditional annual budgeting processes were designed for environments of relative stability. They are poorly suited to 2026 competitive dynamics, where market windows open and close within quarters and strategic priorities shift in response to technology disruption, geopolitical realignment, and changing customer behavior. When resources are locked into prior-year allocations, the organization’s ability to pursue its stated priorities is fundamentally constrained.
Progressive resource allocation within an operating model rewiring context involves several structural changes. First, a meaningful portion of the capital and talent budget—typically between 15 and 25 percent—is held in a dynamic pool that can be redeployed quarterly or even monthly based on strategic performance data rather than political negotiation. Second, the criteria for resource allocation are made explicit and tied directly to strategic priorities, removing the ambiguity that allows entrenched budget owners to defend historical allocations regardless of performance. Third, the cadence of resource decisions is accelerated, with regular portfolio reviews replacing the single annual cycle.
For boards, this dimension of operating model rewiring has direct governance implications. Capital allocation oversight needs to evolve in parallel with executive decision-making structures. Boards that continue to review resource decisions on an annual basis are inadvertently reinforcing the static allocation logic that limits executive agility.
Cross-Functional Accountability: Owning Enterprise Outcomes
Perhaps the most persistent structural weakness in complex organizations is the absence of clear ownership for outcomes that cut across functional boundaries. Customer experience, revenue growth, digital capability development, and supply chain resilience are all enterprise outcomes that no single function can deliver alone—yet in most organizations, no single leader is genuinely accountable for delivering them end-to-end.
The structural response to this challenge varies by organization, but the most effective approaches share a common logic: they create explicit accountability for cross-functional outcomes, backed by real authority over the resources and decisions required to deliver them. This may take the form of dedicated P&L structures, empowered horizontal councils with genuine decision authority, or the creation of enterprise outcome owners who sit alongside functional leaders in the leadership architecture. The specific mechanism matters less than the principle: accountability without authority is a recipe for frustration, and authority without accountability produces drift.
Executing Operating Model Rewiring in 2026
Understanding the dimensions of operating model rewiring is necessary but insufficient. The more consequential question for executives is how to move from diagnosis to durable implementation without triggering the organizational immune response that has derailed so many structural transformation efforts.
Several principles have proven consistently important across organizations that have navigated this challenge successfully.
Start with strategy clarity, not organizational design. Operating model choices are downstream of strategic choices. Before redesigning decision rights or restructuring accountability, the executive team must achieve genuine alignment on where the organization is competing, what capabilities are truly differentiating, and what the model must deliver that it currently cannot. Without this foundation, structural changes become exercises in reorganization rather than rewiring.
Diagnose the current model with rigor and honesty. The gap between the formal organizational design and how work actually gets done is almost always larger than leadership acknowledges. Effective diagnosis combines quantitative analysis—decision cycle times, resource allocation patterns, escalation frequency—with structured qualitative inquiry that surfaces the informal workarounds and shadow hierarchies that have evolved to compensate for structural weaknesses.
Design for the critical few capabilities, not the complete organization. The temptation in any structural redesign is comprehensive transformation—touching everything, resolving every tension, building the perfect operating model. This ambition is both impractical and counterproductive. The most successful rewiring efforts identify the two or three structural changes that will have the greatest impact on strategic performance and execute those with discipline, before expanding scope.
Build the governance architecture before announcing the new model. One of the most common execution failures in operating model work is announcing the new structure before the supporting governance mechanisms are in place. Decision rights documentation, resource allocation processes, performance management frameworks, and leadership capability requirements need to be developed in parallel with the structural design, not retrofitted after launch.
Invest in leadership capability at every level of change. Operating model rewiring changes what leaders are expected to do, not just how the organization is arranged. Business unit leaders who are being given greater decision authority need to be equipped to exercise it well. Functional leaders whose roles are being redefined need support in navigating the transition. The behavioral and capability dimensions of rewiring are at least as important as the structural dimensions, and they require deliberate investment.
The Board’s Role in Structural Transformation
Boards have a distinctive and often underutilized role in supporting executive teams through the challenges of operating model rewiring. Beyond capital allocation oversight, boards can provide the strategic patience that major structural change requires. Rewiring an operating model produces disruption before it produces results—and in a world of quarterly performance visibility, that disruption creates pressure to revert to familiar structures before the new model has time to take hold.
Boards that actively understand the rewiring logic, engage with the diagnostic findings, and provide cover for the short-term disruption are significant enablers of successful transformation. Boards that evaluate structural change purely through a near-term performance lens inadvertently create the conditions for premature retreat.
Building a Model That Sustains Competitive Advantage
The organizations that will hold structural competitive advantage through 2026 and the years that follow are not those with the most sophisticated strategies or the most advanced technologies in isolation. They are those whose operating models are genuinely aligned with their strategic ambitions—where decision authority sits close to where relevant information resides, where resources move at the speed of strategic opportunity, and where leaders at every level know precisely what outcomes they own and have the authority to deliver them.
This is the promise of genuine operating model rewiring: not a one-time reorganization, but a durable architectural shift that compounds in value as markets continue to accelerate and competitive dynamics intensify. For C-suite executives and boards willing to engage with the depth of structural change required, the opportunity is significant. For those who continue to pursue structural productivity through incremental process optimization alone, the returns will continue to diminish. The window for consequential rewiring is open—and the executives who move with clarity and conviction now will be best positioned to lead their organizations into the next era of performance.
Executive Managing Director, WGA Advisors
Paul Johnson is Executive Managing Director at WGA Advisors, where he helps organizations navigate complex challenges including mergers and acquisitions, business process improvement, and culture change. He brings deep expertise in management consulting, business transformation, and organizational development across a broad range of industries. Paul holds an MBA from The Wharton School of the University of Pennsylvania and a Bachelor’s degree in Industrial and Organizational Psychology from Columbia University.