Note: I have taken an example of Centers of Excellence (COE), as example, but not with respective to any company into mind as the above terms are buzz words in market. One can replace COE's with innovation centers or software R&D centers as it still likely to hold good. This is my personal view and opinion. No company or organisation is responsible for the below mentioned information.
Typically organizations which are big in size based on domain/business, as a strategy to increase the profits use a divisional structure which are called strategic business units/delivery centers. Some organizations would typically have centers of excellence/practice group at each of the business units and some organizations would have all this centers of excellence/ practice group all at one place. One of the core elements of the COE charters is converting ideas into output whether it is through competency building, IP generation or thought leadership.
The problem with all above discussed structures, idea gets generated at the top level or from the client/customer and on several discussions at the practice level, idea gets executed. The current structure has top to bottom approach in terms of idea generation and a bottom to top in terms of work done. This architecture works well as long as new ideas get generated from client/top level management. But as the business gets competitive, companies need to be a differentiator and add more value to the customers.
The structure proposed works on a 360 degree approach where the idea gets generated from any of the individuals in the organization. The underlying criteria of this would be adding values to business and customers. The generation of idea works on using the existing infrastructure in the companies. Once an idea gets generated, it is aligned to corresponding domain. Impacts and benefits, technological implementation in carrying out the idea, resources required, plan, functional organizational ownership, project which the idea can be applicable and study of adding value to customers would be carried out by practice people and senior management in the organization. Categorizing in this manner can help managers determine wh
ich technologies to invest in and how they can assist organizations in making the most of them.
Exhibit 1: COE Architecture
D1, D2, D3, D4 – can be taken as various domains
PROJ 1, PROJ 2, PROJ 3 – can be taken as various projects.
TM1, TM2, TM3 – various team members in the project
PR 1 – Individual from practice group.
The structure proposed works on a 360 degree approach where the idea gets generated from any of the individuals in the organization. The underlying criteria of this would be adding values to business and customers. The generation of idea works on using the existing infrastructure in the companies. Once an idea gets generated, it is aligned to corresponding domain. Impacts and benefits, technological implementation in carrying out the idea, resources required, plan, functional organizational ownership, project which the idea can be applicable and study of adding value to customers would be carried out by practice people and senior management in the organization. Categorizing in this manner can help managers determine which technologies to invest in and how they can assist organizations in making the most of them.
Companies can redesign its existing structure such that the person who generated the idea can be a part of these centers of excellence. This would boost the value of the centers of excellence and promotes effective horizontal networking across the organization. This would also bring a lot of value to the projects the individual is working on by having better personal relationships among the COE teams and the project as the individual can give training and also solve similar sought of problems within the project. If the idea-originator is not interested in taking part in the center of excellence (COE), the COE team can engage him for further discussions whenever required.
Once the idea gets generate specific to a certain business/domain, team member from each projects of a domain/business would be a part of COE. One person from the practice group would be more of a senior resource guiding them. One more person from the senior management joins the COE and assists them in the vision and direction of the ongoing project.
Advantages
- Once COE wins a contract (enhancement) in existing project by showing in to customer, the team member in the project who is also part of COE can give training to others and works gets done faster.
- Companies can still work on R&D (where risk is quite higher), COE in spite of currency depreciations.
- Usage of bench strength till the time they get into project by asking them to analyze the ideas.
- Each and every individual feel they would be a part of organization and gives them more recognition once their idea gets implemented.
- Organizations can achieve good profit as the individuals in COE are also part of other billable projects.
Tradeoffs
- People with valuable knowledge or skills may not join the COE, belong to other project, or fail to discover that a CoE exists.
- Since some of the individuals working would be partially in one billable project and other on COE, managers try to influence the individuals in projects by constantly saying COE is not worth it. Hence the mindset of these managers needs to be changed.
