Companies throughout the U.S., both global and domestic, struggle with how best to provide high-level technical support and expert advice to their business units. Many organizations have tried to meet the challenge by establishing COEs (Centers of Excellence). More often than not, however, these pockets of expertise have failed to fulfill their promise.

As we’ve worked with our clients to help them achieve the leverage they want from these centers, we’ve found it helpful to talk of COAs (Centers of Acceleration), sources of meaningful help that truly accelerate the progress of each business unit that takes advantage of them. Before we look at the characteristics of our COAs, let’s examine what organizations set out to accomplish with their COEs.

The Origins
COEs were originally conceived as shared services, where expertise could be aggregated for efficiency gains and made available to help business units. The premise was that certain functions had to be centralized because:

1. Supply of the specialized expertise was limited due to market realities or company choice,
   
   
2. The business units did not need the expertise on an ongoing basis; however they needed it to get started, to reposition and transform a business, or for technical and strategic advice from time to time.

So the COEs arose as a means of taking the specific, specialized expertise of a group and leveraging it across many business units.

The functions typically considered for COEs were of three types: administrative functions (Benefits, Diversity, Planning), functions more fundamentally rooted in the profit and loss equation (Research and Development, Pricing,  Marketing), or any number of highly technical functions embedded in one of the broader functions (Benefits Design, Plastics Engineering).

Living Up to the Promise
How is it that such a clear and obviously good idea was so often ineffective when put into practice?

The problem was that many companies were co-blending the concept of COEs with traditional staff functions. This led to frustration because, although the staff areas possessed the necessary expertise, the COEs were often not effective in delivering this to the business units. To the contrary, the Centers actually seemed to be hampering the business growth of the units.

In part the problem lay in how the people in the business units perceived the COEs. They tended to think of the representatives as “corporate staff” who had more of a control role than an assistance role.

Another part of the problem lay in how the people in the COEs perceived themselves; they did not sufficiently distinguish their role or reorient their behavior from traditional staff to COE. While they possessed the needed functional expertise, they also held enterprise-wide accountability for their functions. As a result, they tended to serve that accountability first, which too often interfered with their ability to reorient themselves to serve the business units. They were simply too vested in their corporate-level initiatives and policies to listen to the business units and to understand their needs.

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