Global in-house Centers (GICs) are creating business impact for their parents in various forms, in addition to arbitrage. However, quantification of impact lags behind “actual” value addition.
Experiences of GICs indicate that quantification of business impact accelerates the ticket to play (e.g., articulate 2 business case to support evolution).
The best-in-class GICs, which deliver and measure value across most drivers, create business impact that amounts to six to eight times the incremental arbitrage. However, GICs are realizing only a third of the best-in-class benchmark.
While the need to quantify impact varies by organizational construct, there are many challenges along the way. However, GICs will benefit from a structured approach to quantification.
Call to action requires GICs to carefully identify metrics beyond costs, set measurable targets for these metrics, and proactively align business partners.
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