Towards an Ambidextrous Centre of Excellence

 

Centres of Excellence (CoE) usually focus on protecting the core business by building capability & evangelizing critical methods or technologies (e.g. Lean/OpEx). That’s no longer enough – in an exponential age, the CoE must also help us grow.

The CoE’s Role is Changing

I’ve worked with CoEs for a couple of decades now & have seen them evolve in different directions. Historically, CoEs have focused on Cost – rightfully so.  Most CFOs will tell you Cost improvements tend to last longer than Revenue growth.  Moreover, Cost is amenable to Total Involvement, Quick & Easy Improvement, Kaizen Teian and other core elements of Lean/OpEx.

The CoE’s core functions comprise five key pillars:

1. Standardize & Share Best Processes & Methods

2. Build Knowledge & Capability

3. Lead, Align & Connect

4. On-Demand Support

5. Create Value through Innovation & Continuous Improvement

I’ve italicized ‘innovation’ in Pillar 5 to highlight the Growth imperative. Exponential technologies like AI, Data Analytics, Blockchain and the rest enable Growth.  Agentic AI, for example, is like the Genie in Disney’s Aladdin movies, making questions around How less daunting. Going forward we’ll be far less constrained by the tyranny of the How.

Protecting the Core is No Longer Enough

Ambidexterity

And so, protecting the core business with Lean/OpEx is no longer enough. To help ignite new Growth, the CoE must absorb a) new technologies like those mentioned above, and b) new ways of working including AI-enabled experimentation, Design Thinking, and Growth Hacking. Ambidexterity is Job One – we have to become ‘two-gear’ organizations able to a) Protect our core business with Lean/OpEx, and b) Ignite new Growth with Digital methods.

I don’t wish to be misunderstood: Lean/OpEx lays the essential foundation. Most transformations begin with Lean fundamentals, but we can’t stop there.  Otherwise, we’ll miss enormous Growth opportunities. Moreover, we’ll commission a Kaizen event when we really need an AI agent or Growth Hacking. I’ve also seen the reverse scenario. A digitally-focused CoE jumps to an expense Digital solution (e.g. RPA or Agentic AI) when a Lean/OpEx solution would be quicker, better & cheaper.

Building an Ambidextrous CoE

We need to build connected, complementary ‘learn by doing’ curricula around a) Protecting the Core Business, and b) Igniting New Growth.  We supplement these with time-boxed, focused, fast-paced sprints and other practical events activities like Boot Camps, Hackathons, and Shark Tanks. Such activities are flexible & can be focused where needed. We begin with Lean/OpEx basics – which remain opaque to many people. Every generation has to relearn the fundamentals.

My practice is to run these in a Train-the-Trainer style. Once the CoE levels up, they can take the baton & teach the organization.

Best wishes,

Pascal Dennis         E: pascal.dennis@leansystems.org