Why GBS Need to Refocus on Location

As GBS has become increasingly synonymous with technology, pushing the envelope for the shared service industry as a whole, how does location factor into the equation? 

To offer leaders greater insight on the subject, Barbara Hodge, Global Online editor of SSON, and Host of SSONext, sat down with Tom Bangemann, Head of Data Development & Research at SSON Research & Analytics.

We take you behind the scenes into SSON’s expansive data resource, to offer a deep dive into the topic of location as it relates to GBS and shared services. 

Why is NOW the right time for GBS to focus on location?

There are really not enough location studies specifically tailored to shared services or GBS in the market. And when you start to look at why that is, the simple answer is that the environment we are living in, which is one of “permanent crisis”, produces uncertainty.

While that does not stop core business operations, we must remember that it touches the people who provide the services. Hence, GBS leaders need to think about how they can better support a model of business, which remains in a state of constant flux through a recession. While there is no easy answer, an environment of uncertainty does have some benefits. It forces us to innovate and think about how the GBS model needs to evolve. Leaders need to take a deeper look at their strategies, with all components, to initiate much needed discussions. They will further need to think about different weightings and different core questions to ask. One of those key questions that comes up repeatedly is the subject of location.

How can GBS leaders leverage their existing location footprint?

1. Let your values guide you

Tom Bangemann, Head of Data Research for SSON Research & Analytics, suggests we start by figuring out what the best footprint for the near future is. For example, if you have an existing footprint that includes locations like India, China, and Eastern Europe, you might go through your list with a lens on political factors, or strategic goals. The data, he explains, tells us that lot of people are considering socio-political purpose as a core value that can potentially modify their GBS location footprint as evidenced by reactions from many corporations to Russia and China. 

2. Use technology as a key driver in your location decisions

If there’s one thing that is universally relevant to all of today's GBS leaders, it’s technology. The sky's the limit on what companies can do when we leverage technology to its full capacity, Tom says. “The work we do is based on people, but the biggest driver currently is technology and we see that in all the different pieces of research we've done so far. This has a huge impact in the context of any discussion about location. In 2023 and beyond, will location be the most important component? No, it will not. But it will be a very relevant one.” 

Where is automation going in the near future? 

If we were to speak of a world in which all the technology we could imagine is made available to us, could we enter a completely automated gig economy? Is that fact or fantasy for the early 2020s, in a post-pandemic world? We asked Tom this question, and he says, “I would argue that we would go further in utilizing more technology for sure. But I doubt we would ever want to or will be able to enter a fully digitized solution.” 

Instead, GBS operations, will focus on achieving a high automation level for repetitive work and then build solutions that will intuitively bring people together to do certain things that are designed to boost social interaction. Networks will be created to support learning and training environments for talent. And there will be more focus on establishing a clearer digital culture – because digital culture is not always the same as the culture a company has in a physical location.

Enjoy the audio medium? You’ll find a lot more detail in this full discussion between Barbara Hodge and Tom Bangermann here on Spotify. Or look for SSONext podcasts wherever you listen.