Global Capabilities Centers Strategic Frameworks – Part II – GLOW for growing & middle stage GCC s

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I have written a strategy framework for early-stage GCCs and am sharing the link for your reference.

https://www.dhirubhai.net/pulse/global-capabilities-center-strategic-frameworks-part-mohandoss-t/

I am happy to share my thoughts on maturing GCCs (aka middle-stage GCCs). I have seen GCCs at this stage seek autonomy in various areas, both in core delivery spheres such as IT, Operations, and Analytics, as well as support functions like HR and Finance. This phase is also a time when the parent organization would find GCCs may be veering away from the ideal path due to the pulls and pressures of growth of the GCCs. Though one can be simplistic to say that early-stage GCCs get into the phase from the 5th to the 10th year after the start of operations in India, it depends on the trajectory of each GCC.

I want to present the GLOW framework for the GCCs in this phase.

?G- Governance: Many GCCs struggle in this phase as Governance is taken as an off-business activity in the best case and a roadblock in the GCC's progress in the worst case. However, this critical area needs to be strategically dealt with. GCC management and control functions, including Risk, Compliance, CISO, HR, and Internal Audit, must play a big part in this domain. We need to understand the industry's regulatory framework, ethical, legal, organizational, reputational, fair practices, and local regulations. The control framework needs to be continuously updated and tested proactively, and we need to evolve a mechanism of the residual risk and the impact thereof. Governance as a strategy is essential to handle the constantly changing regulatory framework and the dynamic workforce. Many GCCs lose their parent's trust, and the GCC, instead of more autonomy, will have more constraints if this area is not handled well.

?L- Leadership:?Leadership becomes very critical in this phase. Leadership building has to be taken as a strategic initiative. There are four skills the leaders need to possess at this stage to be successful.

a.?????Functional skills

b.?????Relationship skills

c.?????Organization building skills.

d.?????Cultural alignment skills

It is evident that relationship management with the parent and cultural alignment of the growing workforce become critical and often the differentiators at this stage. The other skills would be table takes anyway. Leaders must build good relationships with stakeholders to balance the team's satisfaction with necessary autonomy and manage & deliver the stakeholders' expectations. As GCC recruits from service providers and other GCCs, they must align the workforce culturally within a reasonable time. These skills are not natural for IT & operations leaders, so we need to take a strategic view of buying/ developing talent. The leadership programs have to be purpose-built to meet the needs of the enterprise. The leadership needs to play an enabling role in this journey.

?O- Organizational Model: I have seen the GCC swing to extremes in this stage. Some GCC will benchmark with service providers to see how they get more efficient, and on the other side GCC in their quest to add value, will position itself as a real premium service shop by recruiting very senior and top talent. Organization needs to evolve a model so that pyramid that is built suits both the nature of the work and aspirational aspect what the work would be the next few years. If done right, this aspect will ensure GCC is a major winner in this phase.

W: Winning with Innovation: GCCs would have to build an Innovation strategy to help with both bottoms-up and targeted innovation. Every industry has significant innovation areas – Experiential banking, new age services in Telecom, Omnichannel experience in retail, Transition to clean energy in Energy, SDV in Automobiles, and more. There are company-specific innovation targets in revenue increase/ share of wallet expansion, cost reduction, Risk mitigation and containment, and customer & employee experience. We will have limitless opportunities for innovation and how we build a strategy that covers – talent, HR policies, tools & processes, Reward & Recognition, ecosystem exposure, and a culture of active listening (not judgment by the management)

?Thus, GLOW is a strategy framework that can be considered during the middle stages of evolution. I would complete the GCC strategy with a framework for the mature or advanced stage of the GCC.

Compassmet Consulting LLP is a boutique consulting firm focusing on strategy, business domain & technology programs, and leadership programs for GCCs, IT & BPM Service providers, and Technology firms.?www.compassmet.com?details the services provided.