Centers of Excellence are specialist and centralized teams which typically develop narrow but deep capabilities. They are highly efficient at what they do, but they generally only focus on their specialist area.

Summary by The World of Work Project

Centers of Excellence

The concept behind centers of excellence is that by bringing together a group of functional specialists and having them work exclusively on their specialist area, that it is possible to create teams that are both excellent at what they do and highly efficient.

Centers of excellence (CoE’s) are basically the opposite of a generalist or distributed model. We look at some of the differences between these two approaches to organizational structuring below.

Diagram showing a distributed model, not a center of excellence

Diagram showing how functions might work in a center of excellence

Roles within centers of excellence are typically narrow in scope but deep in focus. Individuals working in them are often responsible for only a few specific tasks, but they develop great still and proficiency in these tasks, improving both quality and speed of delivery. An added benefit of such teams is that the centralization of specialist knowledge creates an environment in which knowledge transfer happens easily and regularly. The specialists become even more specialist.

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Learning More

Centers of Excellence may be strategic and considered in an organization’s balanced scorecards, VMOSA framework or Strategy Management framework. Given the way they work, they might also benefit from using huddles. You can learn more about huddles (stand up meetings), in our podcast on them:

The World of Work Project View

Centers of excellence have huge benefits, but costs and weaknesses as well. While they increase efficiency and reduce cost, they also reduce business agility and responsiveness as the individuals in them develop narrow skill sets and they tend to be fairly removed from the business units they support.

They’re typically used in very large organizations and can go in out and out fashion as companies move through cyclical phases of the economic cycle. Their efficiency and cost effectiveness is highly prized in contractionary periods, but their lack of agility can be a hindrance in periods of expansion.

It’s important to note that roles within Centers of Excellence are not for everyone. Their deep, specialist and sometimes repetitive nature makes them very attractive for some people, but less so for others.

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This post is based on our experiences in the world of work and there are no specific references for it.

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