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STANDARDISE EXCELLENCE

The pivotal role of a Centre of Excellence (CoE) during digital transformation

Is your digital transformation journey struggling to get off the ground? Transforming one's business is absolutely paramount to remain competitive and be able to quickly adapt to fast changing market conditions. Sometimes the business case is difficult to build, one which overcomes the obstacles of conflicting interests or disparate viewpoints and agendas across an organisation. What every organisation needs is an entity which focuses on the bigger picture, to provide expertise, guidance, and a unified value proposition for digital transformation. This entity ensures enterprise-wide alignment & consistency in strategic and business objectives that should be met through transformation.

A Center of Excellence (CoE) is a specialised team, unit, or entity within an organisation known for its exceptional skills, knowledge, and practices in a specific area, often related to a particular technology, process, or domain. A CoE can help keep digital transformation on track because it serves as a hub for expertise, ensuring high standards are consistently maintained in providing support to all other parts of the organisation. It focuses on driving innovation, standardisation, and improved performance across the enterprise.

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WHY IS A COE SO IMPORTANT IN SUPPORT OF DIGITAL TRANSFORMATION?
WHY IS A COE SO IMPORTANT IN SUPPORT OF DIGITAL TRANSFORMATION?Steer your transformation forward to successRead More
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COE FOR CONTINUOUS BUSINESS PROCESS IMPROVEMENT
COE FOR CONTINUOUS BUSINESS PROCESS IMPROVEMENTEnsure your process improvement initiatives are carried throughRead More

WHY IS A COE SO IMPORTANT IN SUPPORT OF DIGITAL TRANSFORMATION?

The primary function of a Centre of Excellence (CoE) is to support the business, to provide expertise and best practice guidance and to tackle and resolve issues. This is why a CoE becomes even more essential in the context of digital transformation because it provides the necessary knowhow, structure, and support to drive successful and sustainable change across an organisation. The road to digital transformation is fraught with danger. It can be costly, protracted and an extensive drain on resources, not to mention the many tough challenges and hurdles to overcome along the way. Here are some of these core challenges and ways the CoE can help organisations overcome them:

 

Budget Constraints: A CoE can help optimise costs by standardising processes, reusing assets, and reducing customisation. It can also identify areas where cost savings can be achieved without compromising the project's objectives. By centralising expertise and resources, a CoE avoids duplication of efforts and prevents individual teams from reinventing the wheel. This streamlines the transformation process, reduces unnecessary costs, and maximises the efficient use of resources.

Consistency and Standardisation: Digital transformation often involves adopting new technologies and processes across various departments and functions. A CoE can establish standardized guidelines, frameworks, and methodologies for implementing these changes. This ensures consistency in approach, reduces redundancies, and minimises the risk of fragmented efforts.

Resource Limitations: A CoE can centralise resource allocation and management. By having a dedicated team, it ensures that resources are efficiently utilised across multiple projects and phases of the S/4HANA transformation, whilst still being available to help ‘keep the lights on’ by addressing critical support issues with the existing solution.

Skills Shortage:  The CoE can invest in training and upskilling programs to bridge the skill gaps within the organisation. This can include training existing employees or hiring and onboarding new talent with the required skills.

Lack of IT & Business Alignment: A CoE can act as a bridge between IT and business stakeholders. It can establish governance mechanisms, create clear communication channels, and ensure that IT and business objectives are aligned throughout the project.

Change Adoption: A CoE can develop and implement a robust change management strategy. This includes creating awareness, providing training, and offering support to employees as they transition to the new S/4HANA system. It can also collect feedback and make necessary adjustments to improve adoption rates.

Risk Management: Identify and assess risks associated with the transformation project and develop mitigation plans. The CoE should be proactive in managing and mitigating risks to keep the project on track.

Best Practices: A CoE can develop and promote best practices for S/4HANA implementation within the organisation. These can be based on industry standards such as SAP Activate or SCRUM, as well as methodologies used during previous successful projects.

Knowledge Management: A CoE can establish a repository of knowledge, documentation, and templates that can be used across the organisation, reducing duplication of effort and ensuring consistency. This becomes a valuable asset for the organisation post implementation, particularly for future support and enhancements.

Innovation & Continuous Improvement:  A CoE can foster a culture of innovation by encouraging experimentation with emerging technologies. It can create sandboxes for testing new ideas, conducting pilot projects, and evaluating their potential impact before broader implementation. This approach enables the organisation to identify innovative solutions that can drive competitive advantage. It also serves to continuously evaluate and improve processes, tools, and methodologies based on lessons learned from ongoing projects.

Cross-Functional Collaboration: Digital transformation often requires collaboration across different departments and functions. A CoE serves as a bridge between these silos, facilitating communication, collaboration, and knowledge exchange. This holistic approach ensures that transformation efforts align with overall business objectives.

Measurable Outcomes: A CoE can establish key performance indicators (KPIs) and metrics to measure the success and impact of digital transformation initiatives. This data-driven approach allows the organisation to track progress, identify areas for improvement, and make informed decisions based on quantifiable results.

Vendor and Partner Management: If external vendors or partners are involved in the project, the CoE can manage these relationships, ensuring that they align with project goals and contribute effectively.

 

By implementing these practices and leveraging the capabilities of a CoE, an organisation can better navigate the challenges of an S/4HANA transformation project and increase the likelihood of a successful and cost-effective implementation.

 

 

COE FOR CONTINUOUS BUSINESS PROCESS IMPROVEMENT

One of the biggest failings of many organisations in realising true business benefits from digital transformation is the lack of organisational structure, advocacy and embedment. It’s the elephant in the room. There is a tendency to focus on the endeavour as a technology upgrade - its success measured on whether the project or program has been delivered on time and within budget. Hypercare is over and the systems are handed over to the business. Job done, right?

One of the most important aspects of digital transformation is the optimisation of business processes. Organisations often invest in process analysis or process mining software to support transformation projects.  Business process optimisation is not just a one-off exercise, as it requires continuous application to ensure long term, sustainable improvement. To achieve this, both business leaders and their workforces need to change their mindset, so that process optimisation becomes a working culture, an ethos which everyone in an organisation both understands and has bought in to, long after a digital transformation project is considered over.

In order to drive adoption and long-term value realisation, the setup of a Centre of Excellence (CoE) or Business Process Competency Centre (BPCC) is essential. It’s where clear ownership and responsibility lies, where centralised know-how and best practices are defined and held, and the single source of truth for measuring and gauging success is established. How the CoE interacts with the rest of the organisation, such as sponsors and Global Process Owners (GPO) is just as important, and each has their role to play in ensuring business value is continuously realised.

A CoE or BPCC is essential to drive adoption and ensure long-term value realisation. Here's how the three main stakeholders should work together:

CoE pillar NEW

Executive Sponsor:

  • Provides strategic direction and tangible target setting
  • Requests and monitors value realisation progress
  • Facilitates senior level buy-in and resource allocation

Centre of Expertise (CoE):

  • Agrees and initiates use cases
  • Coordinates with stakeholders to leverage insights and improve process execution
  • Drives adoption through change management, user enablement
  • Communicates achievements

Central Business:

  • Adopts insights and leverages the process mining or intelligence platform for daily usage
  • Implements process changes and improvements
  • Drives continuous improvement to realise business value