What is in this article?:
- Finance Enters the Age of Industrialized Business Services
- Where Operations is Headed
Today's volatile economy demands greater agility from business process operations. In this environment, businesses struggle to grow within established markets; they often seek out new and emerging markets to sustain revenue. And in order to do so, companies must operate both defensively to reduce costs in the face of new regulations and volatile materials prices, and offensively to gain traction in new markets and niches without losing control of operations.
To accomplish all this, the role of the operations leader -- be it COO, head of shared services, operations director within the line-of-business or finance and accounting function -- is becoming increasingly strategic. In essence, they are being called to create a business model innovation. This expanded responsibility requires a willingness to embrace changes that impact operational efficiency and effectiveness in three areas in particular: talent, technology and process management. By addressing these areas, a senior executive can effect a transformation capable of supporting "industrialized" business operations across a wide range of support functions.
Three Reasons for Rethinking Global Operations
While operations can take various forms -- for internal lines-of-business, shared services, operating centers, or global business services -- they all share a common trait: the operations department has traditionally been slow to react to change because it was typically optimized for scale rather than agility. This lack of agility is often the result of the company's focus on cost reductions rather than effectiveness and flexibility. But in a new macro environment, senior executives must rethink the key tenets of their global process delivery structure and take the following three factors into consideration:
1. The Human Factor: A global imbalance between demand for and the supply of skilled workers is growing. With experienced baby boomers retiring, some skills becoming obsolete, and others in increasingly short supply, the traditional office model is under pressure. Today's operations departments include more part-time, offshore and work-at-home resources, but training, managing, motivating and ensuring the compliance of these workers is challenging. Whether the need is for transactional, judgment-based, or data-driven work at the delivery or the management level, finding the right people in the right locations is becoming much harder.
These realities are already impacting an organization's ability to cost-effectively run specific support processes such as accounting, engineering design, and analytics. As job requirements change, HR departments must jettison any "business as usual" approach if they hope to find the right resources when and where they are needed.