There is a growing trend among enterprises across the globe adopting global operating models for service delivery to access new markets and talent, reduce cost, realize higher business value, and reap benefits of scale. Supporting such business models effectively requires development and implementation of effective process models to run the operations. Managing these new business paradigm throws up its own challenges.
Organizations are adopting appropriate governance models to overcome such challenges. The governance model assigns process ownership in an organization to single-point owners called the Global Process Owners (GPO). They drive value by integrating, standardizing and sustaining the processes throughout an organization. Being a relatively new approach there is not any across-enterprise agreement on the boundaries and optimal definition of roles and responsibilities of GPO’s. To understand the role of GPOs, it is important to first have an agreement of the dos and don’ts of the function.
As their primary goal, GPO’s are most commonly expected to achieve process efficiency and effectiveness within an organization. However, they can do much more to add enterprise-wide value. This requires them to take a holistic perspective of an organization and focus on various aspects such as the people, organizational structure, current processes and policies, organizational culture, etc. GPO’s must therefore act to achieve the following:
- Achieve transparency and agility: GPO’s must strive to act transparently in order to overcome mistrust and build confidence among the various stakeholders in an organization. Eliminating process inefficiencies and creating enterprise-wide changes requires a culture that rewards agility.
- Build effective operating model: GPO’s must establish an effective operating model by: developing a good understanding of the current state processes, defining the target state, establishing a plan to streamline & standardize processes and determining definite responsibilities for the internal stakeholders.
- Benchmark standards: GPO’s must establish a performance baseline against which they can measure the organizational performance and improve & initiate process changes, as required. This requires performance metrics, which are holistic and global to achieve an end-to-end process view of the organization.
- Ensure user compliance: GPO’s must actively monitor the various functional, business and geographical units to ensure that they are compliant with the existing or the new processes that are initiated. Any effort to standardize or bring change would be rendered meaningless in the absence of process compliance at the individual level.
Many enterprises fall short of establishing a successful Global Process Ownership model. The major reason for the failure is the lack of clarity, and confusion around the role of GPO’s. There is just as much confusion on what GPO’s must not do as there is on what they must do. The following are some important things that GPO’s must avoid doing:
- Maintain Operational Focus: While GPO’s are the owners for end-to-end processes in an organization, that doesn’t mean that they should act as operational managers overseeing functional and business units to ensure that delivery targets are achieved. They rather should primarily drive process ownership, without expending much time and energy on process execution. GPO’s must not lose focus on the strategic goals and vision of the organization.
- Think Small: Any process initiative or change undertaken by GPO’s have an impact across-the-board on the various global units of enterprises. Therefore, GPO’s must not think small while defining goals and charting plans. They should overcome the limited or narrow vision, and objectives of its various units acting independently. This requires a holistic view and a fresh perspective on optimizing processes across different units in the organization.
- Provide an opt-in/opt-out option: Standardization of process necessitates the need to streamline process across the various business and functional units in an enterprise. Such an endeavor would not be successful if the individual business or functional units have the final mandate to decide to align with the enterprise process standard. Therefore, GPO’s must not provide much leeway to individual units to opt-in or opt-out of the enterprise process standard, which is essential to achieve a successful global process ownership model.
The Grey areas…
There are certain finer aspects to GPO’s roles, responsibilities and objectives, which might not find a place in their formal job description but cannot be overlooked at the same time. The boundary of responsibilities of GPO’s intertwines with several internal stakeholders in an organization. GPO’s relationship with these various stakeholders, however, is laden with challenges. GPO’s are responsible for business outcomes but the resources driving these outcomes at the operational level work under the authority of a functional or a business unit. Therefore GPO’s need to assert the required authority (granted to them by organizational design) on these units to hold them accountable for their process delivery. This should however be preceded by bringing on-board and taking into confidence all the relevant stakeholders who might be affected by any process change that is initiated in the organization. Also realizing change and business outcomes requires securing the support of senior management, which is vital to transform GPO’s vision into action.
While process standardization is a major objective of GPO’s to achieve cross business or functional unit efficiency, they would do well to also bear in mind the benefits of customization that localization of process provides. There is no strict rule that applies to all enterprises to build the right process model. GPO’s should therefore carefully weigh in the organizational culture, demands, current state processes and systems before embarking on their mission to build a successful global process ownership model.
An article from Pradeep Mukherji, President APAC & EMEA with Avasant and Aravindan Ingersol, Analyst with Avasant. This article was previously posted in Global Delivery Report Online Magazine.