Earlier, in April — the perfect time to be in Stockholm — I had the honor to hobnob with a number of industry thought leaders at the 2015 GBS Roadmap (Nordics) event. While the weather kept our spirits up in the Swedish capital, the discussions at the event brought some refreshing clarity to the topic of GBS value drivers. In this blog post, I’ve combined the key takeaways from the event and my own experiences to sum up the elements that, I believe, will help enhance the maturity of your GBS operations.
Functional silos are hard to break
Coming from key decision makers at the event, this one’s not a big surprise. Often, internal functions act in silos and fail to build enterprise-wide capabilities. The culture extends to GBS operations, where lack of integration impedes value creation. What’s surprising, then? Well, silos are often seen as an unavoidable byproduct of growth. But no — disconnected islands of excellence don’t do any good. And in the long run, you’ll only be battling time and cost overruns.
So what works? To drive integration, GBS must go beyond the limits of shared services and fragmented outsourcing contracts. From my experience, starting with top-down, executive sponsorship for integration projects is essential. Ensure process-ownership beyond functional boundaries and a robust governance structure as you gear up to break the silos.
IT that does not effectively support business processes can be a barrier
The role of IT in enhancing GBS maturity was a key point of discussion at the event. While there is consensus on leveraging technology as an enabler, I gathered that many GBS operations are yet to see a meaningful roadmap for how IT could better underpin ever-changing business demands. Interestingly, while systems support core business functions, technology upgrades and relevant investments are most often allocated independently.
We partner with several clients in transforming their IT approach to GBS, and in my view, IT capabilities integrated to and focused on supporting business processes provide a strong foundation for end-to-end GBS delivery. Based precisely on this premise, our stack approach integrates infrastructure, applications, processes, and services with plug-and-play tools that can be calibrated to meet specific business objectives, bringing an unbeatable level of harmonization.
Savings alone can’t sustain innovation
You’ve probably heard this before and yet, it’s hard to get past the low hanging fruit. According to a recent HfS Research report, nearly 87 percent of user-firms consider reduced cost-structure of operations critical to the success of a GBS program. But isn’t cost reduction the most basic of all process improvement exercises? In my opinion, it’s an exercise that can’t be taken on in isolation. And, this is where an integrated GBS practice can add value. When delivered through an IT platform that is aligned to business processes, there is tremendous potential to innovate beyond cost reduction.
For instance, GBS can also be leveraged to deliver data and analytics as a service to the entire organization. These metrics can be monitored to enhance operational maturity, optimize spends, and trigger critical decisions. To deliver on this count, companies must activate well-funded innovation programs with measurable targets for the GBS organization. And while at it, you might want to leverage cross functional expertise to improve integration.
Change management — before it’s too late
While in Stockholm, leaders voiced an urgent need to improve overall governance and change management measures across the GBS organization and to put in place shared governance models with IT. This is another area where an integrated stack approach can help with its common governance structure, across layers of infrastructure, applications, processes, and services.
As companies look to drive up GBS maturity, they are likely to face rough weather in their transformation journeys. The actual impact of those challenges will depend on their experience with unlocking value through integration and standardization, and their appetite for innovation.
How would you define the maturity level of your GBS operations? Have you come across barriers in your GBS journey, or a method to get past these barriers? I am eager to know — do leave a comment…