Does Your Shared Services Center Need an Innovation Team? | Blog
In order to evolve from cost enablers to strategic partners that can drive competitive advantage, shared services centers (SSCs) – what we call Global In-House Centers (GICs) – must support their parent enterprises’ innovation agenda. And whether innovation means one, more, or all of the following to their enterprise, SSCs are quickly recognizing that creation of their own innovation team is one of the key ways they can deliver on that strategic requirement.
Types of innovation initiatives
What is an innovation team?
An innovation team is a group of dedicated resources mandated to evangelize innovation within the organization. The members typically have innovation-specific competency and relevant experience, and are unrestricted by business-as-usual constraints.
While ad-hoc or informal innovation teams used to be the norm in most GICs, the forward-thinking ones realize that a formalized approach is becoming essential for long-term success.
SSCs’ innovation teams influence strategy, capabilities, and culture
Based on our discussions with and analysis of around 800 GICs spread across offshore geographies, we’ve grouped innovation teams’ focuses and capabilities into three areas.
Shaping the enterprise’s overall innovation strategy
SSC’s innovation teams help shape their enterprise’s innovation agenda by enabling decisions on key themes such as: improving the process/product/service mix, enhancing the customer/employee experience, and revamping the business model; impact areas like cost savings, risk management, and revenue generation; and innovation partnerships with start-ups, academic institutions, etc. For example, one GIC’s innovation team was given a mandate to ideate and develop innovative solutions/products to better engage customers. It led all the stages of the innovation journey (from ideation and concept testing to detailed design and development) to develop the enterprise’s flagship mobile payments app.
Enhancing capabilities by improving skills, tools, infrastructure, and technology
SSCs’ innovation teams support and lead capability and ecosystem development. Areas they become involved in include setting up the physical work environment including innovation labs, garages, and digital pods, and developing new methodologies, frameworks, and tools. For example, one GIC we work with – that of a leading U.S.-based financial services firm –assisted in development of a cloud-based, compliant platform for instant communication and content sharing. The platform is used by more than 20,000 employees across the organization for real-time collaboration.
Fostering a culture of innovation
Beyond their primary responsibilities of supporting core, business-as-usual activities, GICs’ innovation teams often serve as “innovation champions” or “innovation ambassadors” to shine a spotlight on best practices and key pitfalls to avoid. These teams primarily consist of employees embedded within the GIC’s business units/functional teams, and focus on domain-specific innovation. This enables direct development of an innovation culture in delivery teams. For example, in one insurance company’s GIC, the innovation team is mandated with promoting innovation at the grassroots level. So, it organizes trainings, workshops, and competitive events.
Innovation team make-up
At a broad level, innovation teams are comprised of the following key roles:
- Innovation champions: Leadership members (typically C-level executives, and functional/business unit heads) for providing strategic guidance
- Program managers: Senior management members and/or dedicated managers for driving innovation programs/projects
- Process experts/technologists: Experts with deep knowledge of product, technology, and tools
- Strategists: Typically, tenured senior resources with extensive experience with innovation programs and solid domain knowledge.
Of course, some SSC’s also include other roles, some very niche and company-specific, in their innovation teams.
Size your innovation team to your specific needs
Our research found that SSCs’ innovation teams are typically comprised of five to 20 dedicated FTEs, spread across the enterprise and the SSC. A relatively small number of GICs have 20-50 or more FTEs that are specifically part of their innovation team.
While most GICs have a lean innovation team, we encountered multiple instances of recently bulked-up teams. Interestingly, there is a limited co-relationship between revenue/size of the SSC’s parent enterprise and the size of its innovation team. What tends to impact the size of the innovation team is the extent of the innovation focus, the level of innovation maturity, existing structures for driving innovation, and broader business requirements.
There is no one-size-fits-all approach. When designing your SSC’s innovation team, you should start by determining what aligns well with the existing structure and caters to evolving innovation needs. You can customize its size and composition once it’s up and running.