These challenges are leading organisations to GBS as a way to centralise key functions and drive efficiency through a number of key value drivers:

What is Next-Gen GBS?

Organisations can unlock an additional frontier of value and drive efficiency by centralising into GBS the activities of ‘non-traditional’ functions, such as commercial functions* and product innovation. The majority of GBS organisations typically only include the ‘traditional’ Big 3 functions: finance, information technology and human resources. Usually they also include a small number of cross-functional capabilities such as facilities support and communications. Leading organisations are starting to see the potential benefits of shifting ‘non-traditional’ functions to GBS.

*Commercial activities include sales, marketing, order fulfilment and customer service

What are the benefits of moving to Next-Gen GBS?

Existing GBS organisations are well positioned to accommodate the movement of additional functions (e.g., commercial and product innovation) to further capitalise on cost optimisation, global control and further process optimisation.

What we are seeing in the market:

Potential benefits:

• Drives further economies of scale/cost efficiencies
• Improves process standardisation
• Speeds up innovation and time-to-market
• Improves regulatory compliance
• Local team can focus on core competencies

Deep dive: commercial in GBS

Moving certain commercial and supporting activities to GBS can help optimise processes whilst liberating front-line commercial teams to focus on more value-added activities with customers. Commercial front-line teams are the engine for growth but are constrained by inefficiencies across the operating model. They are currently spending upwards of 50% of their time on non-core or transactional tasks, and up to 50% capacity can be unlocked for such teams by transforming the commercial operating model².

Commercial activities in GBS:

Figure 2: Commercial activities in GBS

Example benefits unlocked²: 

• Core front-line brand, category, and commercial teams liberated to respond more effectively to changing consumer and customer needs
  
• ~30-50% savings opportunity through consolidation, elimination, automation
• >30% capacity unlock by optimising and centralising key marketing processes
• Field sales representatives reduced by ~35% and customer engagement time increased by ~15%
• ~5-20% total cost of ownership reduction

What are the key success factors for Next-Gen GBS transformation?

We’ve observed 4 key success factors which are critical for shifting “non-traditional” functions into your GBS.

What does Next-Gen look like for more advanced GBS organisations?

GBS has evolved over the last 30+ years. The Centre Office Model has enabled organisations to take shared services to the next level. Organisations do this by focusing on end-to-end services and incorporating capabilities-as-a-service, in order to place more emphasis on customer experiences and outcomes.

Zooming in on the Centre Office Model

By breaking down functional siloes, end-to-end services and capabilities-as-a-service offer a unique opportunity to unlock the next frontier of growth for GBS organisations. The most mature GBS organisations have adopted the Centre Office Operating Model. It features both “traditional” functions (e.g., finance) and “non-traditional” functions (e.g., commercial, R&D, etc.), organising them into end-to-end services such as Lead to Cash, to help overcome functional siloes. This operational set-up also lends itself to delivering common cross-functional capabilities-as-a-service such as automation, analytics and continuous improvement, while focusing on the customer experience.

What are the benefits of adding capabilities-as-a-service to your GBS organisation?

In addition to pivoting from a functional view to E2E services, advanced GBS organisations can also adopt centralised supporting capabilities to service the entire organisation.

What we see in the market:

Potential benefits:

• Improved transparency in operations
• Highlights process inefficiencies/problem areas
• Drives process improvement, automation and cost savings
• Improved knowledge-sharing and reduced attrition risk through a centralised team of experts
• Greater local team focus on core competencies

Deep dive: process excellence & intelligent automation in GBS

Organisations that shift towards being process-led consider process excellence & intelligence automation as centralised capabilities that can serve the broader business. By leveraging central ownership through global and business process owners, organisations can centrally drive end-to-end processes and break down functional silos. Not only does this centralisation facilitate the creation of an intelligent process ecosystem, it continues to contribute to identifying cost saving opportunities in organisations’ structure and footprint.

The opportunity:

• Tactical improvement ideas (e.g., RPA) face diminishing returns as many GBS organisations are taking a siloed approach and lack E2E ownership
• To unlock further value from process excellence, organisations must establish end-to-end process ownership and reduce siloed, uncoordinated efforts
• Instead of focusing on tactical process steps, organisations should take an “ecosystem approach” and focus on delivering enterprise outcomes

Figure 4: process excellence & intelligent automation in GBS: key tenants of a process ecosystem

Key tenants of a process ecosystem:

• Global Process Owners driving E2E process strategy and governance
• Digital platforms providing simplified and standard pre-built workflows
• High quality data that is trusted and reuseable to deliver insights
• AI/Gen AI and automation solutions driving efficiency at scale
• Multi-skilled, customer-centric, digitally empowered teams focusing on customer outcomes, not functional KPIs

Thank you to our contributors of this article: Davide Granata, Cameron Welsh and Orson de Rijke-Thomas