Optimising financial processes

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The New Powerhouse, GBS, gets a “Seat at the CEO Table”

Who knew?

There is a specific CEO publication, “Chief Executive”.

I read an article in this august publication this week, “The New Powerhouse: From Global Business Services (GBS) To The Center Office”.

Recent research, as well as anecdotal evidence, shows that GBS is embracing newer, interaction-heavy functions, such as engineering and R&D, as well as Marketing, Sourcing & Procurement and more.

The authors suggest that, in this way, GBS is transitioning from a stodgy reputation as the “labor arbitrage back-office center” to a “strategic partner and central business organization.”

This is absolutely the aspiration and future of GBS.

We cannot save our way to sustained business success. We need to become a driver of growth and value creation in the organization.

While cost reduction/scalability is still a fundamental prerequisite, the cumulative importance of customer service and experience related characteristics now outweigh cost, it is reported.

However, I think many CFOs would still debate that.

More than half of stakeholders are now fully expecting material transformation of the processes performed by GBS / shared services.

The assertion that “53 percent of organizations have already implemented end-to-end processes, and 32 percent are planning to implement in the next three years” had me reaching for my calendar to see if I had suffered some inadvertent time travel.

Of course, the definition of the “ends” is the key. Every activity, even a task, is “end to end”, but the smaller the cycle, the less transformative the impact.

Semantics, meaning and definitions are key in these discussions.

When we describe “end to end “processes, however, we usually aspire to the value created by full cycle process streams, such as “Source to Pay” or “Customer Demand to Cash”. These are the real value creating “end  to end” processes.

Over 50 percent of GBS organizations claim to have leveraged automation, reporting and analytics, process excellence, end-to-end process ownership and business continuity planning to enhance their customer and user experience significantly.

Whilst this is a bold claim, my observation is that these initiatives are still very much a “work in progress” in most organisations, and the “jury is still out” on the value delivered.  

We are on the right track, but there is a lot of work still ahead. 

The next generation of GBS is expected to drive improved customer service and experience, to increase end-to-end collaboration and execution and to utilize new capabilities to transform the organization.

64 percent of organizations indicated that “talent availability” is the top factor impacting their GBS strategy.

By investing in a skilled, agile workforce, CEOs can create a GBS that can thrive in the changing landscape and materially participate in the strategic conversations, no longer anchoring on just efficiency.

To retain and strategically leverage this talent, organizations need to take a renewed look at their workforce and hiring structure, upskilling opportunities and talent experience.

You can read the source article, “The New Powerhouse: From Global Business Services To The Center Office” by Jessi Singer Cleary and Sonal Bhagia of Deloitte here . . . .

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