Sourcing Shangri-La

Shared Services: In Search Of The Missing Benefits

There's an intriguing backdrop to Deloitte's 2013 Global Shared Services Survey report, just published. Why are so many business cases being missed in shared services? 

The survey confirms that things are progressing as expected. There's growth - in the breadth of services offered, and in the spread of locations - and more complexity and sophistication, with more multifunction SSCs, more hybrid delivery models and more stand-alone GBS organizations.  

This year, Deloitte is not publishing the main survey findings, listing only the questions asked of the 270+ respondents.  But one line in the executive summary hints at what is perhaps the most interesting story of all:

"A multifaceted approach to addressing the retained organization is required to realize the intended benefits." 

The word on the street is that few shared services programmes deliver their business case. They may do great things, they may employ very talented people, but often there seems to be a question mark over benefits realization. And although the 2013 Survey report doesn't comment on this directly, a (separate) Deloitte webinar last week seemed to confirm that there's no smoke without fire.

In Global HR Shared Services: Emerging Trends, Brett Walsh and colleagues from Deloitte shed light on Shared Services ‘optimisation’ challenges:

“Much has been said about the role of shared services in the transformation of the Human Resources function. Yet for many companies, the benefits expected from transformation are proving elusive.”

“Long after project go-live, when systems and delivery models are in place, organisations still struggle to release the full potential of their investment in HR Shared Services. In fact, many organisations report either failure or significant underperformance compared to their original business case.”

[It's true that their focus in this webinar was HR Shared Services. But most SSCs are now multi-functional, and Deloitte claims to have worked on 900 shared services projects. So it's a credible source.]

There’s no single solution. Every organization is different.  But I’m going to stake a claim that one of the root causes for the 'missing' benefits – maybe the root cause - is a laid-back approach to process management.  

It’s the attitude that defining process is simply an overhead and a non-value-add activity; that it's a temporary project requirement, to be consigned afterwards to a dusty folder on the intranet; that it doesn’t matter if process is in duplicated and overlapping fragments, in different tools and formats, unconnected with real work, and ‘governed’ only by email.

Without the rigour and support of a process management platform, effective collaboration among the stakeholders on the design and implementation of change is, at the very least, in jeopardy.  We see it mostly obviously, and dramatically, in the chasm that can appear between IT and the business, but it undermines effective collaboration between all the other stakeholders too.

As it happens, my colleague Angela Chamberlain and I are presenting a WTG webinar on this theme next week.  To hear more on how Nimbus provides a platform for process excellence that can underpin sustainable success in HR Transformation, please register here and join us. 

 

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21 Feb 2013    When Process Standardization Backfires

15 Nov 2012    Outsourcing's Secret Sauce

© Text Michael Gammage 2013

Mapping The Stakeholders In GBS Success

I sat down with a recently-launched and highly ambitious Global Business Services (GBS) team to map all the stakeholders who will need to be engaged to ensure their success.  We rapidly filled the whiteboard (below - disguised!).

It’s an extraordinary number of people,  across multiple functions and regions.  And this is not just about preparing for the launch for this particular GBS. This is about ongoing collaboration – and its scope is only going to expand as this GBS scales up on its five year program.

This organization intends to adopt Nimbus to enable the collaboration across these diverse stakeholders that will be required to deliver outstanding service for its clients. Frankly, it’s difficult to see how else you could do it.

End-to-end process - in the language of the business - is becoming the universal business language.  Wrapped within a robust governance framework, and delivered to users in way that supports them in doing real work, it’s the platform that can ensure effective collaboration across the complex and dynamic service delivery environments faced by most GBS organizations.  

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26 Sep 2012    GBS: Build It - But Make Sure They Come

21 Aug 2012    How To Simplify Global Shared Services

Global Shared Services: Build It - But Make Sure That They Will Want To Come

It's interesting how rapidly the quality of the customer experience is racing up the strategic agenda for leaders of Shared Services Organizations (SSO) and Global Business Services (GBS) units.

Deloitte's Global Survey last year noted the need for any SSO to promote itself effectively - to overcome resistance, and to secure buy-in, by getting closer to its customers.

On the webinar with HfS yesterday, Ron Walker of KPMG went further, stressing brand development as one of the keys to GBS success:

"How you manage the GBS brand is critical. Any GBS has to sell itself, and to show quick wins." 

The perfect backdrop for my plug for an SSON-hosted webinar next month. Building on experience with a range of clients, I want to show how Nimbus Control provides a platform for SSO and GBS organizations to deliver continuous excellence - including an outstanding customer experience.

There's an interesting prelimary discussion, of course, about what we even mean by the 'customer experience' in this context. 

Deloitte has suggested a useful  distinction between the SSO's client - meaning the exec team buying the SSO's services - and the SSO's customer - meaning the day-to-day users of the SSO's services.  

Clearly 'an outstanding customer experience' has to deliver for both the SSO's clients and its service user customers...

[just fyi - in the typical shared services and outsourcing journey for most organizations, GBS units may be the final stage beyond an SSO, but for all practical purposes, I take SSO and GBS to be interchangeable terms in this context].

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21 Aug 2012    How To Simplify Global Shared Services

14 Aug 2012    Enabling The Global-Local Enterprise 

 

 

 

Outsourcing: Death Throes and Birth Pangs

The existential crisis underway in the outsourcing industry makes for amusing reading. The industry has voted by a two-thirds majority to drop 'the O word', reports advisory group HfS, in an attempt to shed its apparently negative connotations. But there's no industry consensus on a new name - and 'outsourcing' features in many of the most popular suggested alternatives.

Phil Fersht, HfS founder and industry thought leader, doesn't mince his words:

"There is far too much “believe our own bullshit” going on and this industry needs to change how it is perceived before it can effectively “rebrand”." 

Phil maps out the four challenges he sees facing a stalled industry. But really they are all one - and summed up in his final challenge:

Challenge #4: How can buyers and providers really partner to foster innovations into business process outcomes?

I'm optimistic. Outsourcing service providers I know are investing heavily to up their game. They see the industry's current convulsions as death throes for a simpler world of labor arbitrage and automation.  And the birth pangs of a world where outsourcing will continue to prosper but in new ways.

If you ask me, two developments will define this new world:

All Work Is Process. The opening sentence to the first-ever APQC report on Business Process Management, published back when Adam was a lad - but it remains broadly true, and it is set to become much more widely accepted. So we'll drop, for example, the empty distinction between 'business process outsourcing' (which really means Finance and HR services) and the rest (such as IT, planning and analytics). All work will be seen as process. The process will always be owned by the enterprise but it may be delivered using in-house resources or be outsourced or, most often, through a hybrid of the two. 

Platforms for Process Excellence. If all work is process then every organization needs an enterprise process workbench. Outsourcing providers will adopt them to enable more collaborative engagements with their clients across the service delivery lifecycle.  Outsourcing buyers will adopt them to orchestrate the delivery of end-to-end processes, delivered through a constantly-adapting blend of in-house and bought-in resources - and to engage all the process stakeholders in continuous improvement.

Arguably, the most interesting challenges are now on the buy side: Developing Global Business Services organizations with the capability to continually re-optimize multiple, complex and dynamic sourcing equations [which include, crucially, keeping IT aligned] to deliver value and innovation for the enterprise. No surprise that GBS is the career choice for some of the brightest people I know.

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21 Aug 2012    How To Simplify Global Shared Services

08 Aug 2012    Death Of Outsourcing 'Greatly Exaggerated'

 

How To Simplify Global Shared Services

Most multinationals are almost ridiculously complex. It's a barrier to innovation, compliance and sustainable improvement - and increasingly a C-Level issue. Simplification has been one of three strategic priorities at GSK, for instance, since 2008. 

So Deloitte's report on reducing complexity in global shared services organizations is well-timed. Unfortunately though it misses the point. 

Deloitte sets out survey results which illustrate the prize.  Tackling complexity effectively, says Deloitte, can reduce the costs of delivering Finance, HR and IT by up to 20%, even in already 'rationalised' global shared services organizations.  And yet only 30% of CFOs believe that their efforts in tackling complexity are successful.

The low-hanging fruit of labour arbitrage and automation were harvested long ago. 'Getting a grip on complexity is', in Deloitte's words, 'the next frontier in reducing costs [of Finance, HR, IT and other non-core support activities]'.

Which is great. But, alas, Deloitte's report on how to get a grip on complexity is - frankly - very complicated. It could do with a complexity reduction program of the sort that it proposes. It presents interesting ideas but doesn't join the dots. Its definitions of an operating model and a business model don't quite work. Its attempt to define four different types of complexity - portfolio, organizational, process and information infrastructure - don't hang together well. It's light on governance and controls. It recognises the significance of master data management but doesn't link it with process management. To its credit, the report clearly advises a focus on end-to-end process. But it dismisses 'process flow diagrams' in favour of an exotic visual value stream approach, the benefits of which would be incidental at best.

More fundamentally, it overlooks what must be the 72pt headline to the complexity-slayer story: the power of process visualisation. 

End-to-end perspectives, expressed in the language of the business, with design principles that make it intuitive and easy on the eye. All managed within a methodology that blends compliance rigour with support for people doing real work, and ensures IT alignment.  This is what drives engagement in sustainable improvement and therefore, ultimately, in business simplification.

And it's not just effective in untangling process spaghetti, or bringing coherence to process fragments.  I've seen it to be equally effective in enabling organisations to escape the deadweight of enormous SOP document libraries and migrate to a far more agile world where end-to-end process provides the overarching narrative, supported where necessary by far fewer, and far slimmer, SOP documents. 

A picture being worth a thousand words etc, we shouldn't be surprised that once people can see what's going on, they are far better equipped to identify unnecessary complexity and collaborate to safely 'make things as simple as possible but not simpler' (to paraphrase Einstein, who never wrote on shared services, as far as I know, but knew a bit about complexity..). 

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28 Nov 2011    Cracking Complexity in Novartis

30 Sep 2011    Optimize 15,000 Business Controls? No Problem.

26 Apr 2011    Process As Science And Art 

'Governance' Has So Many Meanings: Not Helpful

There's a swirling fog of confusion around what 'governance' means in the context of business transformation and process improvement - and imo it's hampering progress. 

Two examples:

Last week's PwC/HfS report highlighted governance as a critical issue in Global Business Services. It offers no definition of 'governance' but seems to mean something like 'a central organization or business unit'. 

In the Hammer and Company Process Enterprise Maturity Model (PEMM), the concept of 'governance' is both broad and specific, covering the extent of the enterprise process model, whether there is clear process ownership and accountability, and whether the 'Chief Process Officer' is coordinating all process improvement projects and driving integration with customers and suppliers.

Both of these may be plausible definitions of 'governance' - but they are also quite a long way from what many people mean. 'Governance' has become a very elastic term. These two definitions may be outliers but there's a formidable spectrum of meaning, from something as simple as version numbering to something as specific as segregation of duties.  

Arguably, 'governance' has becoming so elastic that it's no longer useful. Even its most obvious practitioners usually take it as understood. GRC vendors and consultants focus (for instance here) on risks and controls, with very little on governance (beyond Board issues).

'Governance', in short, is in danger of going the way of 'sustainability'. It's becoming motherhood and apple pie, a term to be liberally used (and abused) as required. 

Which is more than an etymological shame, because it matters. Governance is a critical enabler for sustainable performance improvement. Without it, any program will fail [and there's plenty of evidence how difficult it is to make cost cuts stick].

So what's a useful definition of this essential thing called governance?  Starting at the highest level, the simplicity of this definition is compelling:

Governance is.. how an organization controls its actions.

Deloitte spells out a helpful distinction between corporate governance and operational governance:

"Operational governance is very different from corporate governance, which focuses on oversight by a company’s board of directors and shareholders... In contrast, operational governance is a management activity that centers around key operating decisions by company managers and executives. Major elements include effective decision making through clear organizational roles, responsibilities and ownership... and continuous improvement through effective practices, policy setting, and knowledge sharing."

So what does 'operational governance' translate into, in the real-world context of a Finance transformation program, or a global business services initiative, or a sustainable performance improvement program?

See it through the lens of the principal actors and an operational governance framework comes to life:

For the COO, it's about visibility, accountability and ensuring the capability to design and execute performance improvement. Functions and end-to-end processes, the warp and weft of the operating model, are visible and integrated. Ownership and accountability are clear. Roles and responsibilities for the design of new target operating models, and their ongoing implementation, are explicit. And the whole organization has the means to get involved in continuous improvement.

For the CIO, it's about a collaborative framework that can nurture a rich dialog to ensure complete IT alignment with the business, and fully leverage IT's capabilities for the business.

For a Global Process Owner, it's about end-to-end visibility and ownership, with clear roles and responsibilities, with real-time KPI metrics and analytics, and the means to collaborate effectively with all the process stakeholders - including customers - on performance improvement.  

For a Process Stakeholder, it's about visibility and accountability across the enterprise, within their particular dimension. For the Chief Risk Officer, for instance, it's about understanding risks and controls, and ensuring compliance, within the context of 'live' end-to-end processes, not as something lodged in a document repository, divorced from operational realities.

For the Process User, it's about making it easy to understand what to do, how and when - and to have the means to provide feedback and process improvement ideas. 

So at the heart of good governance is structured and effective communication at all levels. HfS and the LSE presented survey evidence on a webinar last week High Performance BPO which illustrates just how much it matters.

Asked about the reasons for outsourcing failure in their organizations, the respondents were clear that it wasn't for lack of budget for change management. They highlighted instead 'communicating ineffectively with the business' as the #1 reason for failure. And in almost 40% of cases, 'not adequately planning for the full engagement of stakeholders' had a significant negative impact.

How to make it happen? How best to enable an operational governance framework that will drive successful business transformation and sustainable improvement? That's where the intelligent business process management platform comes in...

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20 Jun 2012    Process - The Emerging Global Business Language

29 Feb 2012    Why Process Improvement Projects Fail

 

 

Process - The Emerging Global Business Language

Anyone working on business transformation in a global organization will recognize McKinsey's assessment in research published this week:

"The structures, processes, and communications approaches of many far-flung businesses have been stretched to breaking point."

In Organizing for an emerging world, the McKinsey authors set out survey results - from 300 executives in 17 major global companies - together with their ideas for coping with 'the cumulative degrees of complexity' that globalization entails. 

Process, in one guise or another, is a recurrent theme. It's further evidence that a business process management platform is coming to be seen as the essential infrastructure to enable effective and enterprise-wide collaboration on innovation and continuous improvement.   

The McKinsey authors dismiss, quite rightly, the view that it's as simple as global standardization. Benchmarks, standards and industry models are invaluable guides but, at the end of the day, it's often a complex calculus. Every organization is on its own journey: "No company's restructuring should be viewed as a blueprint for that of another."

McKinsey's respondents themselves identified process as one of the 3 weakest aspects of their organization (from a list of 12, so it's serious). 

McKinsey's conclusions are sound, and, again, process is the leitmotif throughout:

- Don't standardise more than is necessary.  Which makes it vital to have a platform to manage effectively the ongoing tension between global processes and local variants.

- Fit technology to the process, not vice versa. Break out of thinking that automation and systems are, in themselves, the answer.  Which makes it vital to have a platform with an holistic and end-to-end perspective, capable of driving business-led global ERP implementations.

- Listen to all the voices involved. Worry about adoption and communication. Which makes it vital to adopt a process management platform that engages everyone - not just process owners and IT. It must connect with process stakeholders and, as well, support those who execute process and encourage their feedback. 

- Implement from the top. Make clear accountability and strategic direction, and don't be afraid eventually to mandate a new process.  Which makes it vital to adopt a process management platform with a top-down implementation methodology, and a robust governance framework, capable of blending top-down command-and-control methods with bottom-up continuous improvement.

So perhaps it's like this. Today, global businesses typically adopt a company-wide business language to ensure effective communication.

What we're moving towards is a future where global businesses typically adopt as well a more advanced language to ensure effective collaboration. And the language that enables collaborative innovation, within a governance framework that makes clear roles and accountability, is end-to-end business process.

Nowhere is this more true, of course, than in Global Business Services, where the capability to provide end-to-end process perspectives within a complete governance framework, integrated with documents, real-time KPIs, risks and controls, is rapidly emerging as a critical success factor.

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29 Feb 2012    Why Process Improvement Projects Fail

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7 Oct 2011      Accenture: What's Holding Back Shared Services

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Finance Transformation Case Study - BAE Systems

The BAE Systems case study video released today provides another example of Nimbus Control as an enabling platform for Finance Transformation and shared services.

The scope may, at this stage, be limited to one country - but it shows how the controls and audit framework is embedded within the operational end-to-end processes, with all the efficiencies that can deliver.

The focus is on standardization, service excellence and continuous improvement. What the video doesn’t mention is that it was also enabling an ERP consolidation…

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07 Oct 2011 Accenture: What's Holding Back Shared Services

30 Sep 2011 Optimize 15,000 Business Controls? No Problem

 

How Not To Implement Shared Services

A shared services center to deliver HR, finance, procurement, IT and other services for the UK's seven Research Councils. It seemed like a Good Idea when it was announced in 2006. 

Five years on, a review by the UK's National Audit Office (NAO) makes gloomy reading. Overspent £130m against a budget of £79m, and projected savings significantly less than expected. 

How did it happen? The NAO report highlights three fundamental flaws:

Lack of Clarity

"A key factor contributing to escalating costs was the early lack of clarity about how the service would operate. An outline design, known as a target operating model, was not agreed until August 2008, nearly a year after implementation had begun, but it was incomplete and lacked detail. Some elements of design were still ongoing during transition and system launch."

Confused Governance

"Early governance structures were complex. Reviews commissioned at various points during the project showed that responsibilities and accountabilities needed clarification."

Poor Management of Outsourcer

"A contract with Fujitsu to design and build the systems and ICT was "poorly managed".  It was eventually terminated at an additional cost of £13m."

Each of which could, of course, have been avoided, or at the very least mitigated, by the adoption of an appropriate process management platform.

No surprise that developing process maturity is an NAO theme - and runs through the NAO's recommendations in this case: to harmonise processes further, to strengthen end-to-end process management, and to embed continuous improvement.

Hear stories like this one, and other shockers in the Process Hall of Shame, and it's bewildering how organizations can still be in denial about the need for a process management platform at the heart of any shared services project.  As though it was a 'nice-to-have'.

Whereas actually it's the key to clarity at every level; to effective collaboration within a robust governance framework; to IT alignment; to drive process harmonization; to controlling a multisourced environment; to making life easier for the SSC workforce; and to enabling a culture of continuous improvement.

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07 Oct 2011    Accenture: What's Holding Back Shared Services

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Deloitte Shared Services Insights: Could Do Better

Accenture's report earlier this month did a good job in advancing the debate about shared services. By comparison, Deloitte's latest shared services insights disappoint. It's a commendable report - but it kind of misses the point.

Overlook the waffle and the sloppy thinking: Accenture's report does nail the essential truth - that a service management framework is vital for sustainable success:

There needs to be a “system around the system” that includes the people, discipline in procedures, communications, service expectations, performance measurement and key cross-functional processes, such as continuous improvement and client relationship management. It’s this broader shared services system around the system— which Accenture calls the service management framework—that sets shared services organizations that have achieved high performance apart from those with a sub-optimized centralized service delivery model. The service management framework is the keystone...

I've argued elsewhere that Accenture needs to go further and recognize that the service management framework for shared services, in its best developed and most valuable form, is the business process management platform at the heart of the enterprise. 

But, that qualification aside, the idea of the service management framework is a crucial advance and deserves to be adopted.   It provides the context by which we can understand that Deloitte's latest list of worthy insights - on the importance of change management, IT alignment, governance and enhanced controls - are in fact all inter-related.  And jointly soluble, once we frame this correctly. 

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13 Oct 2011    Placing A Big Bet On Global Shared Services

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Placing A Big Bet On Global Shared Services

"The companies you work for are placing a big bet on your success. Your job is to scale fast...". Deborah Kops's presentation captured the moment at this week's Finance Summit.

Shared services is set for very rapid growth. There is a convergence around an SSOS model of shared services implementation: Stabilize - Standardize - Optimize - Source. It's a model that's driving the expansion of shared services into global business services operations, delivering not just the traditional Finance & HR services but others such as Procurement and Supply Chain - and doing all this in an increasingly multisourced mix.

Unsurprisingly, change management featured heavily, reinforcing the importance of a service management framework. One organization reported 28 change initiatives running concurrently in its P2P process alone in this FY.

The challenges are changing as shared services moves up several gears, and beyond the easy wins in automation and labor arbitrage:

Customer Satisfaction. The pre-conference survey showed service improvement was on a par with continuing cost reduction. Several SSOs are using KPIs based on the Net Promoter methodology to measure client satisfaction.

Continuous Improvement. There's an new focus on continuous improvement programs. CI was one of the delegates' top budget priorities for 2012. 

Talent Management. There's a lot more focus on people, morale, motivation, engagement and retention. 

No surprise that there was a lot of interest in Nimbus Control as a service management framework that can orchestrate complex change and enable continuous improvement.  It was in the challenges of ERP projects that the visualization of process, in the language of the business, seemed especially powerful. Stakeholders in most organizations simply don't have proper visibility of the current and future state, can't do easy gap and impact analyses, and have no governance framework, beyond email, for managing change.

My conference highlight, by the way: sharing a table with a global P2P owner spending $52bn this FY. Awesome.

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11 Oct 2011    Continuous Improvement Made Easy

07 Oct 2011    Accenture: What's Holding Back Shared Services

 

Continuous Improvement - Made Easy

Naturally, I would say that Emitra Nelson from Cameron stole the show on Day 1 of the Summit for Finance Leaders in Dallas today (you can hear her story on a SharedServicesLink webinar on 18 October - more details here).

But if I couldn't vote for Emitra, on the grounds that hers is a Nimbus success story, my choice for the most thought-provoking presentation would be Andrew Simpson, Head of Business Services in America for BP, whose case I summarised in a doodle in my notes as this:

 
(my maths is shaky, so I'm hoping this means what I was thinking!)

Andrew defined Continuous Improvement (let's call it CI) as 'operational excellence through process improvements' , or, more informally, as 'stopping business insanity'. He listed the 20 most common excuses he's heard about why CI can't be done, the funniest being the manager who claimed that it would be 'against corporate policy'.

He then proceeded to show exactly how he has implemented CI, and went on to make a totally convincing case that, in the long run, 'background' CI can be even more valuable than high-profile transformation programs.  And a CI culture, he argued, will also make any major transformation program more likely to succeed: people are engaged and energised by change, not simply resistant.  In shared services terms,  CI is 'the critical success factor for any SSO that wants to stay relevant'.  

What's really interesting is how few of the organizations represented in the audience have a serious CI program.  There's lip service but little commitment. How can that possibly be? At the end of the day, CI is pretty straightforward. 

Maybe the clue lies in a video Andrew used in his presentation to illustrate resistance to change (can't find it on YouTube, but it was like this).  The hamster keeps getting on the wheel, spinning faster and faster until it's out of control and finally gets flung out into the cage - then does it again, and again and again... 

Maybe the hamster enjoys the adrenalin rush - just like the business enjoys the thrill of firefighting.   And when, after a while, the hamster is punchdrunk with concussion and unable to think clearly, well that's like the business getting so used to living in firefighting mode that it too can no longer see clearly - and so resists the CI initiative that is ultimately its way forward.

Finally, a great endorsement for CI: people from BP's Business Services unit are sought out by the rest of the business.  It's career-enhancing because it has a carefully thought-through and well-executed CI program that encourages people to bring their brains to work. It breaks out, he noted, of the analysis paralysis of left brain thinking, the belief that life is a machine and we just need to understand how the cogs fit together to get it to work perfectly.  It recognizes the special and unique value that diverse perspectives, working intelligently together, can create.

There was a ton of other good stuff too of course.  More on that later in the week, I hope.

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07 Oct 2011    Accenture: What's Holding Back Shared Services

20 Sep 2011    BPM: The Foundation For Operational Excellence

 

Accenture: What's Holding Back Shared Services

Hats off to Accenture for bringing some reality and insights to the debate about what's holding back Shared Services. 

Everybody's doing shared services, everybody thinks it's strategic, yadda yadda yadda. The reality though is often disappointment and missed business cases.  Sustainable success in shared services is still the exception.

The Deloitte Shared Services survey, published in April, highlighted some lessons learned: the importance of governance, a collaborative framework, transparency and change management.   

Governance was also a theme running through the PwC/HfS report on Global Business Services, published in July: it has to be 'ongoing', 'well-integrated, consistent and rigorous' and not just another tool for vendor management.  

Those were useful contributions.  But Accenture's report this week Trends in Shared Services: Unlocking The Full Potential brings a new focus.  It spells out what the leaders are doing, and how they are succeeding. And process excellence is front and center.

Noting how one leader in shared services uses automation and metrics and process improvement specialists, it continues:  

"...while other elements are certainly in place - C-level support, comprehensive change management and a relentless focus on value - it is the organization's continued focus on process excellence that stands out ."

I share the report's enthusiasm that shared services will mature to become ubiquitous. And that we are witnessing the emergence of "a long-envisioned" model of integrated business services.  I agree too that 'managing multisourcing consistently' is a huge challenge for most organizations. And I'm delighted that Accenture highlights the vital need for a service management framework.   

But I have one quibble. Because even Accenture hasn't quite joined up the dots.

What is it, ultimately, that enables process excellence, that provides the collaborative framework for change management, that ensures transparency and IT alignment, that supports Lean and other continuous improvement programs, that provides the governance framework for the effective management of outsourcers, and that allows cloud and social media to be most effectively leveraged?  It's a business process management platform. 

It's not a panacea. It can seem a bit boring. It's an unspectacular answer when your SSC is 'in a complete mess'. But everything points to the business process management platform as the foundation for success in shared services.  It underpins process excellence. It's what enables the service management framework.  And it's the only way to optimize the management of process variants, which, the report notes, is the real problem in process standardization. 

What is the business process management platform that can do all this? I've defined it elsewhere as a platform that uses the universal language of end-to-end business process to enable four capabilities.  The only way I'd improve on that definition now, especially in the light of the Shared Services workshop in London last week, would be to re-iterate the importance of adoption.  If our brilliant process management models don't engage process stakeholders, and help real people to get real work done and to contribute to improving things , then we're missing the biggest trick of all.    

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03 Oct 2011    Shared Services at IP11: Your Top Issues

19 May 2011    Service Integration and Process: In Six Minutes

  

Shared Services @ #IP11: Your Top Issues

 
I hesitate to use the word 'landslide' but attendees at the Shared Services workshop at IP11 last week voted decisively on their own Top 3 issues (after strongly endorsing the issues identified by the Deloitte and PwC surveys earlier this year):

(1) Managing process variants

(2) Retaining IP and strategic control where activities are outsourced

(3) Building a continuous improvement culture.

Haha - no real surprises here for regular readers! For others new to this blog, there is more on variants here, on retaining IP and control in outsourcing here, and on continuous improvement here.

Slides from the workshop are available from the conference website. Thanks to all who contributed!

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PwC and HfS on Global Business Services Success

Seven out of ten for PwC and HfS on their report: The Evolution of Global Business Services.

Credit where it's due: The report highlights governance as crucial, in a way that's not been done before.  And it's helpful too in setting out models and objectives for global business services. But it's silent on what is rapidly emerging as a fundamental for success.

Governance is a theme running through the report, and it's a mature understanding:

Governance has to be 'ongoing', not project or deal-related. Governance is not about another tool for the vendor management team.

Governance has to be 'well-integrated, consistent and rigorous' and process-oriented, capable of orchestrating change across complex service delivery environments with multiple and diverse stakeholders.

What's missing from the report is the learning that's emerging on how you do this. 

That learning, in a nutshell, is this: the tools which got us this far aren't sufficient to deliver this new world. 

Global business services initiatives are often bogged down, even paralysed, by the tools they are using. The result in many cases: 'a complete mess'.

Everything indicates, as I've noted before, that successful global services organizations will increasingly depend upon an integrated management platform that:

- provides line-of-sight between a target operating model and operational realities

- enables effective collaboration, especially between IT and the business, right across the  complex service delivery and supply chain of the extended exterprise

- embeds governance, compliance and controls within the operational processes

- delivers at the front line and engages the organization in continuous improvement.

This is not about the triumph of the process nerds.  It's about enabling the enterprise to manage effectively in an additional dimension: end-to-end process.   

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