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COE – Just another word for bottleneck

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Experience in and out of them has taught me that Centers of Excellence are rarely if ever that – excellent. They are the most well intentioned of things at the beginning and often add value. The problem is the concept never really goes away on its own once in place. COE’s are more often than not created because there is a useful skill set, technology or process that has value – but not enough value for any one budgetary unit to fund it alone.

Some would also argue COE’s are a way of concentrating highly specialized and theoretically scarce resources so they can be leveraged across multiple organizations. During the early days of adoption for any program this is reasonable but more often than not the COE positions itself as a gatekeeper rather than a facilitator. Prioritizing access and ultimately justifying internal expansion.

A healthy COE should never expand beyond a predetermined point as demand grows for its services. It should replicate and specialize. This is possible to do while maintaining consistency and governance provided the COE has external oversight. If it does not replicate then the goal of the COE ultimately turns from change promotion to self-preservation. As the focus turns inward, quality and accountability to anyone but the internal chain of command erodes. The goal then becomes to preserve the metrics rather than deliver whatever service they were originally charged to manage.

So the bottom line advice – plan for retirement. From the beginning limit a COE’s original charter to three to four budget cycles. If it hasn’t discovered a replicating model in that time then there is little doubt that the original business case is still valid. In fairness though – vehemently guard the first two of those budgets as often truly transformational changes in large organizations are rarely bound by a 12 month cycle.

In any event you are guanteed that whatever the initiative, after three years technology and the economy will have changed to the point that revisiting whatever brilliant idea started it all is a good idea since the premise is probably no longer valid.

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3 Responses »

  1. Hi Lee,

    I read your post with interest as I’ve seen many CoEs come and go in my career to date. Indeed many of them are still there but come across better on a Powerpoint slide than they do in practice!

    As you say, it is difficult keeping a healthy CoE going past the initial budget cycles. Many of the people that initially drive it move on or simply don’t have the time to participate at the level that they need to. Then the momentum behind it starts to fade and the CoE becomes stale. And you are also right, sometimes the CoE shouldn’t be kept going; if it has run its course then disband it rather than having it turn inward.
    CoEs need continuous investment and governance in order to thrive and …. be excellent. The only way that they can get this is if they clearly demonstrate measureable value. For example, they need to be seen as clearly helping to shape and close deals, helping reduce the time to resolve customer issues, etc. Once it stops providing value (that is over and above the investment to keep the CoE going) then it probably should be disbanded.

    One of the best examples that I’ve participated in was when I worked for Compaq (now HP) in Munich, Germany. 12 years ago. Yikes! Compaq set up what was effectively a CoE (although they didn’t call it that) that included a demonstration lab of all its enterprise servers running on enterprise business systems such as SAP. If a customer was interested in Compaq hardware and their intention was to also run SAP on it (as an example) then they were invited into the CoE where they could spend, say, 1 day, 2 days, a week, with experts in the field and given the opportunity to try it out, discuss and explore their requirements and issues with the experts. Almost without exception, when they left the CoE, they had all their questions answered and had complete confidence in running their business systems on Compaq hardware. I can’t remember what the sales success ratio was, but it was extremely high. The CoE more than paid for itself.

    Best regards,

    Adrian

  2. Thanks for the comment Adrian. Interesting that my best experience with a COE was long ago as well.

    Makes me wonder if its a pattern that has seen its day and needs to be replaced altogether.

    Just out of curiosity – if that COE is no longer functioning do you know how long was it effective?

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