Hi, Mary Knox here. Over the past few weeks, I’ve spoken with a number of clients about their efforts to centralize data or processes, both to reduce costs and to improve efficiency and reduce risk. This is a topic we’ve researched for a number of years (see Balancing Centralization and Decentralization, or Defining Architectural Spaces, for example), and one in which I have a great deal of personal interest.
In several recent client sessions, the questions were around how business units can be convinced that they have a lot in common with each other – common data, common processes – so it makes sense to standardize and centralize.
This may be an effort doomed to failure – what business units need is not convincing of their commonalities, but convincing that centralized operations understand, respect, and will heartily defend their differences. Business units must be free to access and use data and implement applications as best fits their unique needs and capabilities. Centralized services can free business units to focus in value-creating activities by providing utility-style services, but only if they don’t insist on a one-size fits all. And that demands that the focus be on what shouldn’t be centralized and standardized. Acting for the “good of the enterprise” means protecting the ability of individual business units to generate profits.
I’d be interested in hearing other people’s thoughts on this issue, and how they have successfully – or unsuccessfully! – sought to answer the centralization/decentralization issue.