Whether organizations are transforming business processes by setting up captive, shared services centers, outsourcing or structuring some combination of both, the moves represent a major change for stakeholders, business lines, and end users.
Organizations tend to focus on leadership from the top as the critical success factor for implementation of global services. Yet they ignore the fact that visible endorsement cannot substitute for a retained team competent to juggle a myriad of factors when developing a solution, determining the pace of change, dealing with a various personnel issues, and managing a relationship that is based on often alien commercial principles. They must have capabilities — the ability to implement highly complex change programs as opposed to competencies — the vital subject matter or domain skills in business processes. Having competency is critical to designing the optimum solution, however, capabilities are crucial to developing, justifying, sourcing, implementing and managing services.
It doesn’t take much to justify the need for global services capability. With many options for business-process transformation, getting the decision right is not a back-of-the-envelope exercise. Adding to the complexity, the team must be able to sort through an array of providers to ascertain the right structure and cultural match. The cost of changing delivery strategy must be underwritten by a complex business case. The complexity of implementation means people issues cannot be fully relegated to the human resources department.
Ensuring change sticks by leading, engaging, listening and intervening by implementing appropriate response models, while pushing for harmonization and standardization, is not a task for neophytes. Developing a performance mentality that is transparent and promotes continuous improvement when process delivery is not in direct control takes skill and rigor. Comply with evolving regulatory requirements and manage business risk; it quickly becomes apparent that every aspect of the transformation requires capability.
A recent survey conducted by SharedXpertise provides strong evidence that transformation success correlates directly to the skill sets of internal resources. Almost 200 organizations, in the process of or attempting transformation, cite the capability of the current team as the biggest barrier to the successful implementation of any strategy. And, surprisingly, although external resources are available, respondents prefer to go to it alone, rather than rely on consultants.
These data suggest that, in order to implement a new delivery model, building capability internally is of paramount importance. But which capabilities are critical to achieve sustainable benefit through global services delivery?
The Six Pack
Whether building or buying, a corporate team staffed with six critical capabilities — change, sourcing, people, performance, risk and governance — is key to transformation success. What does this “Six Pack” look like?
Change: Helping the organization understand the rationale for and embrace new ways of working. In our hardwired world, change management is often a “touchy-feely” veneer applied to make new operations, locations, processes, procedures and technologies palatable to end users. Yet a recent survey indicates that the inability to manage change is one of the greatest obstacles to the take up of global services. Gauging reactions to change, identifying the right amount of change which will deliver sustainable benefit and communicating it in such a way that all parties at the minimum understand — if not embrace — change is a critical capability that few organizations invest in.
Sourcing: Developing, underwriting and implementing the right service-delivery strategy. Many business process transformation teams run to the request for proposal process. But sourcing capability requires a broader set of skills than those necessary to host a beauty pageant. The process must start with a strategic view of the interplay between tools (build, buy or some combination), scope, functionality, benefit and cost. Going to market and contract should reflect the intent of a strategic services sourcing process, not getting the lowest cost deal. Services are continually “sourced” as business needs and performance changes, through change request and re-structuring processes. The savvy corporate team understands that sourcing capability is required throughout the entire lifecycle.
People: Identifying and resolving critical human resource issues such as labor relations, work shadowing, organizational alignment and re-skilling the retained team in order for the internal function to truly become more strategic. Human resources issues make or break services delivery. Yet the management of these challenges is often relegated to an overburdened HR department whose capabilities can only support the status quo. Changes in service delivery naturally result in personnel change that must be approached in deliberate phases — assessing legal implications of staff realignment, identifying the skills required in a new model, re-designing the organization to respond to business requirements, assuring retention during cutover. Managing the relationship between delivery and people is a core capability of the services team.
