The Evolution of the Global Business Services Delivery Model
Global business services (GBS) is an organizational concept that has gone through multiple value lever phases:
- Centering work for transactional unit cost savings and to create scaling capacity.
- Utilizing offshoring to chase structural savings in global labor markets.
- Partnering with business process outsourcing providers (BPOs) to contractually lock in savings while adding global capabilities.
- Germinating centers of expertise, excellence and now global capability centers (GCCs) where highly skilled knowledge workers can be shared across the enterprise to act as force value multipliers.
Today, these value levers can be found in an almost infinite variety of hybrid GBS delivery models.
Value Generation at Any Evolution Stage
GBS brings agility, flexibility and capabilities to an enterprise that drive enterprise value.
- Process excellence (PE): Level of process simplification and standardization achieved through best practices implementation, and lean/continuous improvement for process improvement with robust governance.
- Enabling technology (ET): Degree to which technology is embedded into a shared service, as well as the maturity of core and ancillary systems supporting the organization.
- Data and analytics as a capability (DAC): Maturity of analytical capabilities available to support the GBS organization itself, the SG&A functions and the broader enterprise.
- Business process outsourcing (BPO): Use/leverage of BPO provider(s) for shared services. Degree of maturity of BPO provider capabilities and relationship with the customer, including contractual commitments.
- Service operations management (SOM): Capabilities supporting the GBS operations, both captive and BPO
Formulating Your GBS Strategy
GBS organizations with clear strategies for the actions above will be able to deliver value at pace with a higher degree of consistency. It is imperative that companies embrace these crossroads and lean into GBS as an enterprise value creator.
Originally published 15 July 2024
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.