What is governance? What does it look like? And how do you do it? 

Several years ago, I was doing my part to learn/apply/lead the enablement of Global Business Services (GBS) at my former company, and I rhetorically asked these questions in the presence of a group of consultants from one of the Big 4 firms. I did not receive a response, but it got me thinking more deeply about the concept. 

Meriam-Webster defines governance as, “the act or process of governing or overseeing the control and direction of something.” The root of governance, govern, comes from the Latin gubernare which means to steer. Control, direction, and steering sounds a lot like driving a vehicle. To do this, first you need to get behind the wheel and make yourself accountable for leading the journey to the desired destination. Then, to be successful, you need a dashboard/instrument panel to provide trip information (a map or navigation system would also be useful). Finally, you need to share insight that you have gained and get feedback from a variety of stakeholders: passengers, fellow drivers, and pedestrians, so you can adjust along the way.

1. Present Yourself as a Servant Leader

If the first step in governance is taking the wheel, then someone needs to climb into the driver’s seat. In the process-centric, cross-organizational context of GBS, the best approach is “volunteering to be accountable” for smooth operation and continuous improvement of an end-to-end process. It does not matter which functional department “owns” the work. Declaring that you are willing to be responsible for overall results is a way to jump-start governance. Reach out and engage others who manage important activities to better understand how their world works and offer tangible help. Creating the perception of a servant leader rather than someone trying to take over will lay the foundation for governance based on trust rather than organizational rank or an edict from executive management. Authority voluntarily conferred by the group gives you legitimacy to expand a sense of shared accountability throughout the organization. Establishing leadership to effect governance is just the first step, now you need key performance indicators (KPI’s) to assess vital signs and target improvement.

2. Build Your Instrument Panel

If your area is information-poor and data-challenged, what can you do? Start by counting important things. Key figures that link your operation to the broader company context are important to ground your measurements, so things like overall revenues, employee population, number of locations, business units, etc. are good denominators to show something/per or as-a-percentage-of. Counting process-specific items will give you more KPI building-blocks to start computing metrics. Figure out how to get accurate figures on a consistent basis from systems or existing reports. 

Here are a few examples:

Now that you have the basic information, you should consult third party sources (SSON Analytics, APQC, Hackett, etc.) to learn the standard metrics that most GBS organizations use. This is important because as you mature and understand baseline results, you will want to compare your performance to others and set improvement targets.

A KPI scheme should contain both process and outcome metrics. Process metrics represent the workings and health of the underlying system while outcome metrics represent voice-of-the-customer (VOC). 

For example, someone who works in a distribution center might consider their process metric this way: “My job is to ensure that all eCommerce orders ship same day, so order-to-shipment cycle time is my metric.” 

On the other hand, the end customer is concerned with overall lead time (the outcome they care about), expressed as, “When will I get the product if I order today?” 

Good dashboards contain a balance across several dimensions. Typical ones such as cost, quality, and service can be augmented with measures that track strategic goals (e.g., automation) as well as customer/stakeholder satisfaction.

3. Activate Governance by Establishing Recurring Events

There is a saying in the Lean/Six Sigma world that goes something like this: “It is better to act your way to a new manner of thinking than to think your way to a new manner of acting.” 

This basically means just do it and you will perfect things as you go. So, acting is the best way to instill a new behavior. To complete a minimum-viable-product (MVP) governance system, the final piece is to establish a series of recurring events where the servant leader and various stakeholder groups come together to review KPI’s/results, update/align on key initiatives, exchange feedback, and chart the course forward. To allow for appropriate content, focus and participants, at least three different kind of events should be contemplated, Operations Review (Ops Review), Process Council, and Quarterly Business Review (QBR).

By recommending new recurring events, I am not advocating more useless corporate meetings. A servant leader is responsible for ensuring that governance events have value for all attendees. This duty includes outreach/scheduling, creating/facilitating content, engaging participants to provoke discussion, following up with meeting minutes, etc. As the governor, you need make it happen.

Summary

Governance is the glue that unites GBS and the wider enterprise in the common cause of organizational success and continuous improvement. It is about holding ourselves and others accountable in a way that is constructive by creating the conditions to learn, apply, and lead to make progress towards our individual and collective goals. Governance is just a word that stands for an intangible concept until someone steps up to start a systematic approach. 

Start with data, turn it into useful information, arrive at insight in collaboration with others, and drive the right actions based on the signals. It is as simple as driving a car. But you had better get going! The traffic these days is starting to get heavy again.

These are my thoughts on how governance works in GBS, but I am sure there are other important points that I may have missed. I learn best by listening to feedback so that I can integrate the best thinking to build an even more complete view. 

How do you apply governance in your organization? What have you seen that works (or does not) and how can we learn from each other’s experiences?

Join my discussion on LinkedIn.