Centers of Excellence: Strategies, Types, and Best Practices

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What Is A Center of Excellence?

A Center of Excellence (CoE) is a team of skilled knowledge workers who work with the mission to provide the best practices around a particular area of interest within an organization. It can be understood as an entity creating special interest groups for thought leadership on a particular focus area.

Center of Excellence’s (CoE) purpose is to focus on finding and sharing best practices with other departments, rather than performing operational tasks. The process enables Center of Excellence to help other departments improve their performance and efficiency.

A Center of Excellence should also be distinct from a business department or center.

Types of Centers of Excellence

Center of Excellence (CoE)s can be classified into four major types as mentioned below.

Best Practice Centers

This type of CoE aims to disseminate data and foster collaboration. The nucleus of a best practice CoE often begins with idea evangelists that coalesce to mature and push innovative strategies into an organization.

For example, a recently formed best practice center can help provide mature ideas around test-driven development within an organization. So, the simple measures of success for the organization include reduced cycle time and improved product quality.

DevOps Centers

This type of CoE delivers a specific service to the organization. Consolidation of the service increases consistency when converted into a shared service and provides a platform for improved governance. DevOps centers generate demand through governance, pushing services by controlling who can perform them over time.

They can also act as a highly structured training ground when included as a step in a job rotation program. Simple measures of success for this type of CoE include utilization metrics regarding the number of shared services used versus the ones that remain unused.

Competency Centers

This CoE adopts and refines processes and frameworks that can be leveraged across organizations. Salesforce uses the term “guide” to describe competency centers. They generate demand for their services by consulting and selling ideas.

As this type of CoE evolves, it generally becomes a mixture between a think tank and a process laboratory, which can lead to the next level.

Simple measures of success for this CoE include framework and process adoptions and other internal consulting requests.

Innovation Centers

Change is perceived to be a constant process in most organizations. Innovation CoEs develop or mine the industry for new and innovative approaches to continuously modernize products and improve the cash cycle team concept.

Simple measures of success for this type of CoE include the number of experiments performed and ideas inculcated into other portions of the organization.

How to Create a Center of Excellence

Organizations must have clear components including an overall vision and strategies that fall in line with it to host successful centers.

The steps to rolling out the CoE include the identification of team members, scheduling regular meetings, setting goals and timelines, and creating a resource hub for sharing helpful resources.

Here is a breakdown of the steps to create and implement a Center of Excellence (CoE) within an organization.

  • Define Vision and Strategy

This stage involves conducting assessments to conceptualize the Center of Excellence (CoE) and establish its feasibility.

If the scope is broad, the CoE will have difficulty making an impact. On the other hand, if the scope is narrow enough, the CoE may find it easier to justify its existence. So, it should be focused enough to make a real impact on the organizational functionalities.

It is important to appoint an interdisciplinary committee that will be responsible for envisioning the center to develop a clear vision and strategy for the CoE. This team will assess the availability of requirements, such as financial resources, leadership support, and organizational culture.

Furthermore, they will also craft a working mission and vision statement. Finally, the team will conduct a study to assess the need for a CoE, determine the services it will offer, and ascertain its financial viability.

  • Describe the CoE’s Function and Role Categories

A Center of Excellence (CoE) works efficiently with a responsible and reliable team. If an organization has a team full of experts in their field who need to be more organized and work well together, the CoE will struggle to succeed.

On the other hand, if a team of average performers exists in the organization who are extremely well-organized and work well together, the CoE is more likely to be successful.

Therefore, building a team structure that allows individual and collective success is important for CoE implementation processes. The most convenient way to do this is to create teams with a mix of experts and generalists.

The experts can provide deep knowledge in their respective areas, while the generalists can help connect the dots between them and ensure everyone is on the same page.

  • Assemble a Strong Team with the Right Attitude

The key to success is having a team that is excited about innovation and willing to take risks. Innovation is impossible without risk and an organization cannot have a team that is willing to take risks without instilling confidence in them.

Technology can be learned by anyone, but it is the natural risk-takers that will be the true game-changers for a particular company. This requires the ability to take risks and subsequently share and learn from mistakes.

Team members can work more vigilantly to improve processes and deliver better results by learning from failures.

Fast failure can lead to continuous improvement and a more successful team. It further helps bring integrity and energy to the team, with a sense of ownership in joint successes.

  • Complete and Commercialize the Center of Excellence (CoE)

This is the last step in creating the CoE. Once the design and development plan is submitted and approved, the CoE moves from the blueprint stage to construction and the final launch. Later, it falls under the greater organization’s strategic management framework, which includes standard planning, implementing, and evaluating processes and activities.

All these elements enable the CoE to operate proficiently and achieve its goals of driving excellence within a company.

How do Centers of Excellence Drive Value for Organizations?

A well-formed and executed digital center of excellence can add value to an organization by building customer trust, instilling confidence and self-assurance among staff, and establishing a superior reputation among other organizations in the industry.

The Center of Excellence (CoE) is a great way to share knowledge and increase the efficiency of a company in a short time while ensuring that employees are getting the best possible support. It can be designed to increase the general knowledge of an organization, or improve a specific process or business area.

The CoE can also add value by contributing to the following in addition to its core focus areas.

  • Optimize the organization by centralizing high-demand resources and unique knowledge or skills and streamlining contributions across a wide range of areas
  • Improve ROI by identifying and developing reusable assets
  • Find and fix duplication of effort across initiatives within the practice or enterprise Reduce delivery times, development, and maintenance costs by increasing efficiencies and leveraging reusable assets
  • Develop and maintain a catalog of reusable assets to add tremendous and tangible value and enable project teams to rely on proven, predictable results while avoiding common pitfalls.

Best Practices of Effective Centers of Excellence

Establish Stable, Monitored Environments

Creating proactive monitoring routines should be a top priority for the CoE. It enables the organizations to ensure that any changes made to production adhere to best practices by establishing repeated quality assurance and platform testing processes.

Continuously Improve Processes

Creating an iterative methodology will help ensure that everything is done correctly, at the right time, and with the right people. It is necessary to establish an intake process that includes a three-tiered assessment when starting this process.

The assessment will help identify which items are suitable for automation, based on the following factors.

– Complexity

– Suitability

– Business value

Design Lightweight, Consistent Governance

Lightweight and consistent governance is the key to ensuring compliance and best practice.

Organizations can create an exceptions-based approval process and get their security and infrastructure teams to provide checklists of areas where they need to be consulted.

The governance gate is the only way to pass things through the sprint cycle so they can be planned, tested, built, and deployed, and then put through a retrospective way. This helps to make things more efficient by making sure the right people are engaged at the right time. It also improves quality and reduces the amount of rework that needs to be done.

Every successful CoE initiative will encounter mistakes along the journey, which the organization should learn from and use to adjust its approach. As the CoE matures and learns, some early best practice guidelines and recommendations will likely be replaced by other innovative strategies to drive successful transformations.

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