What makes GBS capable?
Any kind of transformation is dependent on technology, but also the organizational foundation it builds on: GBS has the agile and flexible setup needed to deliver and scale any kind of transformation. Because continuous innovation is in the DNA of many GBS organizations (not least because GBS employees are keen to upskill), it can naturally deploy an agile approach to help transformations move quickly in sprints. And its inherent global structure, its ownership or stewardship of data across regions and functions and its deep knowledge of processes means that it is the obvious candidate for multi-geography transformations.
While organizations with a mature GBS are in a good position to harness this innovative, technology-led transformation engine, there is no need to assume that new entrants to GBS are locked out. Organizations who are new to GBS will be able to leapfrog over the traditional journey from outsourcing to shared services to GBS, and go directly to a model in which GBS is an ecosystem manager, often consisting of small units governed by functions with outcome-based pricing.
How can GBS address today’s challenges?
In today’s challenging environment, GBS can even step in and take over some of the organization’s mission-critical activities.
Companies have been struggling with siloes for 25 years, and end-to-end (E2E) processes that efficiently cut across functions have long been a promise that’s yet to be delivered. Today, with automation GBS is getting much closer to convert this promise into reality.
As GBS takes more activity away from functions, questions arise over how processes – and the GBS organization – are governed. Who does GBS report to? Who is representing GBS on the board? Who decides what extra powers to give to GBS?
A new generation of leaders see E2E process-based organizations as a given – they will take control away from functions, with process governance switching to GBS. For some organizations, however (especially in EU) the trend is moving away from large GBS organizations to much slimmer Centers of Expertise, managed by functions – then having an even more strategic dimension.
At the current rate, robotic process automation (RPA) will be applied universally in GBS and shared services within the next three years. If not, there will be nasty questions – now functional leaders have bot builds in their target agreements because it’s such an obvious source of savings.
However, RPA implementations can fail. This might be because digitalization is a necessary starting point, and very few organizations are broadly digitalized – but GBS can help address this.
Businesses cannot rely on just one model any more. To become fit for the Transformative Age they need to continuously innovate and experiment. Agility is the mindset, and in the very DNA, of GBS – so it can drive a polymodal business model, effectively managing a portfolio of bets.
How to move forward with GBS?
An evolved, agile and capable GBS can become a key pillar of a company’s digital strategy and perform as a transformation engine.
But there is more to the future GBS picture, and organizations will also need to consider critical questions about GBS structure and operating model, the talent it relies on, how to attract and retain it – and what that talent actually does in a highly automated environment.
And with GBS increasingly being given the mandate to reengineer processes end-to-end, organizations need to consider how they can deliver the frictionless, value-adding services that will delight customers and create competitive advantage.
So where are you on your transformation journey?