Global Business Services (GBS) is a solution to streamline operations, addressing common challenges in post-merger integration, business expansion, digital transformation, and efficiency programs.
GBSs are particularly effective when companies aim to reduce operational costs, centralise activities, standardise processes, increase service quality, mitigate regulatory and compliance risks, and focus teams' efforts on core business.
Organisations have experienced a significant increase in productivity in their operation after implementing GBS, resulting in a 30% reduction in back-office staff due to the implementation and a sixfold increase in productivity in transactional processes. The framework below outlines the main benefits of the GBS model.
Benefits of Global Business Services Implementation
GBS Management Model
The GBS is responsible for an end-to-end vision of the activities. GBS can centralise a wide range of processes, but the model primarily generates value by absorbing processes that are transactional in nature, can be standardised and have high volume. Common examples include purchase-to-payment processes, order-to-cash activities like billing and accounting, HR processes such as payroll and recruiting, and administrative and facilities management. GBSs can also effectively manage call centres and help desks.
The management model enhances control over regulatory compliance and mitigate risks, such as handling sensitive information. It ensures the adoption of company policies and standards.
However, GBS is not only about centralising processes. There is a specific governance and management model. This model involves establishing service level agreements (SLAs), defining a catalogue of offered services with aligned costing, and implementing a robust customer-oriented relationship model. This includes defining service channels, measuring customer satisfaction, and promoting continuous improvement.
How can GBS generate value?
GBSs help standardise operations ensuring consistency in processes and the implementation of industry best practices across all divisions. The consolidation of functions generates economies of scale, eliminating duplicate functions and reducing overall administrative and operational costs.
Additionally, GBSs serve as a lever for digital transformation. They facilitate the centralisation of systems and enable centralised investment in new technologies and automation.
GBSs can scale operations up or down based on organisational needs, making them adaptable to future changes and growth, such as M&A projects and expansion.
GBS Implementation Success Factors
A critical factor in GBS implementation is securing commitment from top management. Leadership endorsement is essential to prioritise resources and ensure alignment with the company's strategic objectives.
A clear roadmap of initiatives, with quantified gains and investments required, is essential for measuring success and reporting actual benefits enabled by the GBS. Implementing quick-win opportunities can increase leadership engagement.
Managing stakeholder expectations is another key challenge. Establishing clear Service Level Agreements (SLAs) is crucial to defining service quality and performance expectations. A catalogue of services with associated costs enables effective budgeting and financial planning. These agreements provide a framework for monitoring and reporting on GBS performance, ensuring transparency and accountability throughout the organisation.
Change management plays a pivotal role in navigating cultural integration and overcoming resistance to GBS implementation. Proactively identifying and addressing sources of resistance ensures smoother adoption.
Cases - Successful GBS implementation
Conclusion
Global Business Services (GBSs) have proven to be a powerful tool for companies seeking to streamline operations, reduce costs, and improve service quality across multiple sectors. By centralising high-volume, transactional processes and implementing a strong governance framework, GBSs enable businesses to achieve significant efficiency gains while maintaining control over compliance and risk.
Visagio has been the main partner of GBS implementation by various clients, enabling them to achieve these benefits. If you want to know more about how Visagio can help you start this journey, message us at contact@visagio.com.
About the Author:
Renan Momesso is a management consultant at Visagio with extensive experience in implementation projects, developing and applying solutions in various areas such as post-merger integration, global services provider, procurement, financial modelling and customer experience. He has worked across a broad range of industry sectors, including mining, financial services, technology and the not-for-profit sector.
