Posted on: Dec 18, 2019
In recent years, we have more and more often heard about the concept of Global Business Services, which is mentioned in the same breath as Shared Service Center organization and Business Process Outsourcing. We are more and more often asking ourselves the question of what the GBS model really is, why the number of companies that aim at implementing it increases so fast, and who can provide support in the new strategy deployment.
Unlike the SSC model, where Shared Services Center is a separate entity that has emerged from core organization and that is responsible for providing services to its local business units, the GBS model consists of setting up a global, integrated and centralized organization that provides comprehensive and complex end-to-end processes (whereas in case of SSC, local business units continue to participate in process execution, as only some of clearly defined activities are transferred and consolidated in SSC). In the GBS model, there is usually a hybrid organization, which means that services can be either delivered by a designed company unit, or that they can be outsourced – under the condition that the service delivery process is centrally controlled and managed by Global Business Services. In addition, GBS is defined as the highest, the most advanced and the most sophisticated level on the SSC maturity scale, which can be achieved by a company only if it has: optimized and automated processes (standardization and harmonization in this case is not enough), optimized and modular designed IT systems, and experienced, quality service-oriented and having in-depth process knowledge resources.
According to SSON report „Evolution of Global Business Services to 2017: The Story so Far”, the number of companies which are handing over some of their processes to SSC / BPO providers and which have decided to implement the GBS model, has grown by nearly 80% over the past four years. What reasons are driving the decision makers to go one step further and to entrust the overall execution of not only transactional processes but also of those requiring much more specific competencies (just to mention here few higher value functions, such as consulting and business analytics) to a separate business, instead of keeping them in the core organization scope? Key benefits of GBS implementation are: significant cost reduction, focus on core business development, process optimization and automation around the world (led by Global Process Owners) and finally, IT system integration across the whole company; GBS also include the ability to leverage best practices, to unify reporting and data management processes, to improve decision-making, and finally to analyze global transactional data for optimal resource allocation.
The last question that will most likely occur, this is the one related to implementation of GBS model itself. Which strategy should we adopt when the decision to further develop the SSC organization has already been taken? How to estimate deployment time frames, how to assess if and when our company will be ready to adopt this new model? What to begin with and who should be assigned as a project leader? Does the company have resources and know-how that will allow to plan all actions
and forecast all changes, to identify risks and challenges, and to secure a successful implementation of new business model? In case the company does not have (or does have, but not enough) resources who would be sufficiently experienced in order to manage the project, it might be worth considering the option of engaging an external transition services provider.
Consulting companies operating on the market, specializing in business architecture and strategies design, transformation programs management and process reengineering, offer a wide range of services for SSC&BPO sector. It is crucial that the selection of an external partner is based on the premises such as: project methodology proposed, range of services provided, clients portfolio, company position on the market. Moreover, it is highly recommended to check each consultant’s managerial skills and his or her previous experience in transformation projects management. Finally, it is worth highlighting that the flexi – bility and adaptability of service provider is crucial for successful implementation of new strategy, and that it is extremely important to get the guarantee of
readiness to quickly adapt project resources to fast changing and dynamic project environment.
Justyna Szklarczyk-WojdakProgram Manager / Senior Consultant, ADAPTIVE Solutions & Advisory Group
Article originally published in Outsourcing & More magazine, issue 49