HR operating model & GBS

GBS Governance

Embedding Global Business Services in your organisation

25-07-2023

More and more organisations are on the journey off Global Business Services (GBS). GBS is grouping support functions, such as Finance, Procurement, IT and Human Resources (HR) into a cross-functional structure. GBS ensures higher value for the business at lower costs as a result of the increased synergies it provides in terms of organisation, optimisation, knowledge, and resources. The question lies: what is the best way to govern GBS, or what are the scenarios to embed GBS in your organisation?

To make this decision, you will have to look at your respective organisation and its maturity. In this article, we show the scenarios to consider.

GBS Governance; embedding Global Business Services in your organisation

Scenario 1

The GBS leads report to their own function hierarchically (solid line) and to the head of GBS functionally (dotted line).

Each function drives their part of the GBS roadmap from their business objectives. This results in more siloed directions for process and service improvements within Finance, HR or IT. There is less of a formal client-supplier relationship and usually the focus is more on quality than on cost-saving. It will provide GBS with a mandate to fulfil functional business needs and projects in an efficient way.

This model works for a GBS organisation that is building up their scope of services and still improving the service delivery for their function.

Een model over GBS governance, een grafische weergave van GBS in een organisatie

Scenario 2

The GBS leads report to the head of GBS hierarchically via a solid line and to the function via a dotted line (functionally).

In this governance model, there is a strong driver for GBS to integrate processes across the functions. The GBS mandate to drive company-wide efficiency is leading. GBS will take on cross-functional business cases for larger investments and bigger benefits for the company. Some functional improvements, however, may not get enough attention. There is a risk that the biggest function will drive the GBS roadmap.

Organisations may prefer this model because the relation towards GBS is more professional, similar to a Business Process Outsourcing (BPO) relation. Other companies don’t like the fact that GBS becomes a ‘supplier’ at distance or more ‘us and them’ behaviour.

Overall, this model works for a more mature GBS organisation that is focused on full operational excellence. This model also works best when the size of each ‘tower’ in GBS is similar or when their added value is considered equally important.

GBS Governance: The Model of implementing GBS in your organisation

Scenario 3

GBS and Function integrate where they come together; one role for the Operations or Service Delivery lead per function. They have a solid line to the head of GBS and a dotted line to the head of their function. Most importantly, they are part of the Management team in GBS and of the Leadership team in their function.

In this model, the GBS mandate to drive company efficiency is maximized. At the same time, it has the strong and direct connection to the business function. This model requires strong people in the Operations or Service Delivery Lead roles to make sure each function delivers on the functional objectives while delivering company wide value.

This model should be the target model for each mature GBS organisation.

What Quintop can do for you

Quintop provides support to organisations in decision making and implementing a GBS solution, as well as optimising existing GBS structures. From leading the implementation programme to managing the people impact. Our approach is built on our experience in GBS implementations across the globe.

Want to know more on GBS governance?

Marja is happy to answer your questions