For businesses around the world, the impact of the past two years of change has rested on a few questions. Can employees work productively and efficiently from home? How can advanced technologies drive seamless operations? How should organizations leverage existing platforms, such as global business-services (GBS) and regional shared-services models, to build newer capabilities that advance their digital agendas?
There’s encouraging news. In our research of almost 50 GBS organizations, more than 90 percent report that they had effectively scaled up the remote-delivery model, with virtually no loss of productivity—and without harming client-service experience or employee experience.
As vaccinations move the COVID-19 pandemic from an emergency to an ongoing, potentially manageable concern, businesses are working to find the next normal. GBS organizations’ current challenge is to determine how they will work, evolving to incorporate more work-from-home arrangements while continuing to deliver value. New, distributed ways of working—and transforming processes end to end—may become the norm rather than a one-off response to a crisis.
GBS is a critical enterprise backbone, delivering a range of support functions, as well as back- and middle-office operations. Clients’ expectations of GBS organizations continue to rise, with stakeholders expecting greater efficiency and continuously improving service effectiveness. For instance, they expect that GBS organizations will use automation to accelerate manual work, apply technology to eliminate potentially unnecessary processes, and create self-serve ways for users to get what they need quickly and on their own schedules.
Digitization moves fast, a truism that has both complicated existing ways of working and presented opportunities to deliver more value. And the COVID-19 pandemic tested GBS organizations’ ability to pivot to a remote operating environment.
Now technology and digitization are taking center stage as GBS operations work to integrate multiple changes to the business environment—such as customer preference for digital-first solutions, as well as the need to redesign processes to support that digital-first model and integrate a globally distributed workforce, some of whom are working from home. At the same time, these operations are pursuing end-to-end process optimization and other strategies that drive economies of scale.
Automation is a key focus area for GBS. Research from the McKinsey Global Institute suggests that by 2030, automation is likely to affect around 60 percent of all jobs—meaning that at least 30 percent of those jobs’ constituent activities were found to be automatable using demonstrated technologies. Within the finance function, for example, our colleagues estimate that more than 40 percent of jobs can be either partially or fully automated in the next decade. At an estimated 80 percent of Fortune 500 companies, many of the automatable tasks—general accounting and learning administration, for instance—are already within a GBS model. This provides a great platform for GBS organizations to deliver value by reducing cost of ownership while funding innovation, such as by automatically creating customer invoices as soon as delivery is accepted and proof is reconciled.
The challenges in GBS operations
To thrive in the coming months and years, comprehensive digital capabilities will be increasingly essential. GBS organizations are already facing a flood of data from digital processes, the Internet of Things, visual AI, and other new, digital input sources. New pressures are adding to the challenges.
Distributed-working
Research suggests that, in advanced economies, around 20 to 25 percent of the workforce could work from home between three and five days a week. That’s between four and five times higher than typical prepandemic levels. A scalable remote model highlights additional needs: to instill self-starting behaviors, boost employee morale and productivity, and redesign workflows for seamless operations.
One global financial institution’s GBS organization set up a control tower that helped it rapidly scale up remote work in response to the pandemic. The control tower’s job was to balance demand and supply as it integrated workflow across six global sites. That meant not only defining a blueprint for scaling up remote work but also strengthening data-security and risk-management practices across a large, widely distributed workforce—all critical to the institution’s successful scale-up of a remote-delivery model in just three weeks.
Human and technology interoperability
As digital adoption continues to rise, enterprises look for their GBS organizations to provide both thought leadership and execution muscle in adopting technology across key processes. They expect mature GBS organizations to serve as a nerve center for building digital capability, driving automation at scale, and developing software that builds and repairs other software.
Delivery accuracy and timeliness
Working from home and remote delivery are becoming the norms, pushing organizations to reconsider long-term location strategies to optimize cost, resiliency, and access to the right talent. They are also reassessing the role of the vendors that manage critical services. How dependent should they be on today’s relationships, such as with a business-process-outsourcing partner that provides a managed service for orders to cash—a people-, process- and systems-enabling platform?
Working from home and remote delivery are becoming the norms, pushing organizations to reconsider long-term location strategies to optimize cost, resiliency, and access to the right talent.
