01. 17. 2018 by First Avocado

Most organisation partner with external entities either when transaction cost of production exceeds that of itself or when expectations of product quality and expertise cannot be sourced within. Take for example a creative agency that works with companies in communicating a brand –  the agency is fulfilling on-demand talent need and also reducing overall cost of ownership for the sourcing organisation. In similar fashion, third party consultants are employed to lift organisation from the rut through diagnosis and change. The expectation here is that the external body of knowledge holds experiences unmatched to executives in the organisation. The chance that external consultants will add value in delivering the output contracted for, however varies. The following discussion weighs the idea of creating a rich pool of in-house experts – specifically building a team of management consultants by the organisation and for the organisation.

Management Consultant (MC) offer services that transcend selling expert advice but also includes engagement models that deliver outsourced services. The discussion here is about contracting MC as experts in specific domain. MC brings with them a plethora of experiences from managing similar engagements in diverse backgrounds. A strategy consultant may bring experiences from handling variable sized companies of different industries. The assumption behind onboarding such consultant is that best practices and learnings will be leveraged in diagnosis and creation of compelling strategy. It is vital for the buying organisation to know what they are getting into – many a times the organisation gets sold into fancy Microsoft presentation and final revelation sounding jargons. A consultant may bring in diverse experience, but it takes time for the consultant to truly live the spirit of the organisation – culture and values are secret sauce that can tilt interventions in either direction. To feel the pulse of the organisation, interventions require more than just diagnostic tools and templates, it requires consultants to acclimatize to the work surroundings and collect intangible cues. It needs time. Because consultants are normally billed on unit of time, often they fail to deliver on those engagements that require deeper understanding of softer elements.


This is where the business need for establishing a company’s very own Centre of Excellence (CoE) comes in. Ofcourse this is far from hiring and managing best talents. Creating a team of experts to drive thought leadership requires a different mindset.


Building Management CoE is not a cost saving measure. It is an engine for companies committed to continuous improvement and / or innovation.

Its nature of existence differs: an innovation led company’s expectation are different from one that wants to drive continuous improvement. Two primary enablers for CoE are resource skills and the structural placement of CoE in the organisation.


The cumulative competencies of CoE should be diverse ranging from management to technical resources who have spent considerable time in the company. The diversity brings in creativity and collaboration across stakeholders. Most importantly, these skills have to be complemented with a deeper understanding of organization culture. Hence CoE experts are normally subject matter experts who have been part of the organization journey. The common overlapping competencies include structured problem solving skills that are backed by institutional theories.

The structural positioning of CoE in the organisation structure is what really drives success. CoE needs to have the power and independence to not only carry research but also recommend and implement solutions without leaning to any functional pressures. The structural independence is so important, that for innovation driven organisation, CoE are not only placed outside the management structure but are also physically located elsewhere. Ofcourse, like all functions it should be linked to establish coherence to an organization’s overall objectives. The need for independence is further established from the fact that such a body needs to stay relevant and keep up with developments happening outside the corners of corporate office.


Such an approach is suitable for large companies, in which CoE can be co-shared amongst departments. Smaller companies have challenges, as it needs to balance the cost and the benefits of creating such teams. A typical approach for smaller companies is to setup virtual teams in which experts can be pulled on need basis. However, for fulfilling obligation such as this, experts needs to be cross trained and should have an independent framework to lean on to.


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