GBS: The Limits of Centralized Governance Teams

Last week’s webinar on HfS’s survey findings on GBS confirmed the continuing ascent of GBS (ignore the title! No-one beats HfS at razzamatazz…).

For me, it re-opens a debate about governance because at the core of the HfS prescription for GBS success is ‘a strong centralized governance team’. Which may be true but I think misses some important nuances.

We agree that appropriate governance is always essential, whatever the organization and its circumstances, and that it must be centrally coordinated. But it also needs to be embedded in business-as-usual in the line wherever possible.

In a world of mega outsourcing deals, where much of the back office is delivered through a handful of global suppliers, then managing everything through a central governance team (a Vendor Management extension) makes perfect sense.

But that world is fast disappearing, as the HfS data confirmed. Hybrid GBS is rapidly becoming the norm. The future is about weaving end-to-end service delivery from across a constantly flexing mix of internal resources and outsourced service providers.

In that scenario, it is business stakeholders, not a centralized governance team, who are best positioned to drive innovation, to forge more effective collaborations with customers and service providers, to identify and manage risk.

GBS - The Limits of Centralized Governance Teams - 30 Oct 2013Enabling business stakeholders to deliver what buy-side organizations say that they really want – agility, innovation and more collaborative relationships – requires that day-to-day governance is embedded in BAU.

Which links directly to organizational process maturity. High-performing GBS organizations will leverage an enterprise process management platform both for its embedded governance and holistic perspectives but also to underpin their own service management frameworks.

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