Model 14
7I Corporate Center Model

3 August 2020
Which key roles should be played by the corporate center in my company?

Key Definitions

In management jargon, a corporation is a company consisting of two or more business units. While each business unit has its own strategy and focuses on succeeding in its own market, to make economic sense a corporation needs to be more than just the sum of its business unit parts. An overarching corporate strategy is needed to ensure corporate value-added.

It is the task of the corporate center, the level above the business units, to drive this corporate value creation process. In carrying out this task, a number of corporate center roles can be played, each with their own activities, instruments and types of value-added.

Conceptual Model

The 7I Corporate Center Model describes the seven possible roles with which the corporate center can add value to the company. Every corporate center needs to choose which roles they want to play, in what way and with which intensity. The roles fall into three general categories; corporate composition roles determining which businesses should be part of the corporate portfolio, corporate synergy roles stimulating cross-business linkages, and corporate management roles focused on steering the businesses towards optimal performance.

Key Elements

The seven possible roles of the corporate center are the following:

  1. Investor Role. As investment portfolio manager, the corporate center can actively optimize the allocation of financial resources across existing business units, pumping funds into some, while withdrawing it from others. At the same time, it can consider opportunities for acquisition and potential divestment.
  2. Incubator Role. As driver of new business development, the corporate center can nurture the founding of novel business activities outside the scope of the current business units, by supplying internal or external entrepreneurs with advice, knowledge, contacts, money and facilities. This support is particularly important for innovative business ideas.
  3. Infrastructure Role. As provider of shared services, the corporate center can offer high quality support activities in such fields as IT, HR, Finance, Legal, SHE (safety, health & environment) and Facility Management. This support infrastructure can unburden business units, while creating synergy by bundling expertise and achieving economies of scale.
  4. Integrator Role. As architect of competitive advantage, the corporate center can integrate the business models of two or more business units, leveraging strengths in such areas as R&D, operations, marketing and sales. By facilitating synergy across such primary activities, the strategic position of the business units can be greatly improved.
  5. Internal Role. As line manager for the business unit heads, the corporate center can steer their behavior by setting strategic guidelines, challenging their strategic plans, checking on performance, assisting in solving problems and giving feedback. The recruitment, promotion, retention and rewarding of business unit heads is also part of this role.
  6. Interface Role. As external stakeholder manager, the corporate center can be a more authoritative and active counterpart for such actors as shareholders, investors, banks, governments, regulators, unions, industry associations, NGOs and media organizations. Lobbying and corporate communications are also part of this role.
  7. Identity Role. As heart of the organization, the corporate center can foster a sense of community within the company, encouraging the business units to work together as a team towards a common interest, sharing and helping each other along the way. Building and maintaining this joint identity can support being effective in all of the previous six roles.

Key Insights

  • Corporate centers need to add value. A corporate center costs money, directly through the extra staff and facilities required, but also indirectly through the slower decision-making, additional reporting, multiple meetings and bland compromises. Therefore, every corporate center needs to have a clear strategy for adding more value than the money they cost.
  • Corporate centers have parenting roles. Just as parents shouldn’t just “have kids” but need to think about how they want to “raise kids”, corporate centers need to think about the various parenting roles they want to play, to bring each of their “daughter companies” to a higher level and build a stronger family.
  • Corporate centers can play seven roles. Corporate centers can determine the family composition, as investor acquiring and divesting units, and as incubator growing new ones. They can build family linkages, in an infrastructure role creating shared services and in an integrator role linking business models. They can manage the family, internally guiding the daughters and interfacing with externals. And at the core they can foster the family identity.
  • Corporate centers need to determine their parenting style. Some families are very tight, others very loose. Which roles a corporate center selects and how they are played – the parenting style – needs to be aligned with the overall corporate strategy.
  • Corporate centers need regular rethinking. Over time corporate centers grow and evolve for reasons other than strategic choice. A regular check-up can keep them aligned.
Subscribe to our monthly Management Model

Do you want to be notified of our monthly Management Model? Please fill in your email address here.

Publication Schedule

June 2024
Time Management Funnel

May 2024
Digitalization Staircase

April 2024
Leadership Circle Map

March 2024
MOVING Mission Framework

February 2024
BOLD Vision Framework

January 2024
Duty of Care Feedback Model

December 2023
Best Practice Sharing Modes

November 2023
Stakeholder Stance Map

October 2023
Status Snakes & Ladders

September 2023
Customer-Centricity Circle

August 2023
Activity System Dial

July 2023
New Pyramid Principle

June 2023  
Cultural Fabric Model

May 2023       
Corporate Strategy Framework

April 2023  
Ambition Radar Screen

March 2023
Resistance to Change Typology

February 2023   
5I Innovation Pipeline

January 2023     
Thinking Directions Framework

December 2022      
Corporate Management Styles

November 2022     
Strategic Action Model 

October 2022
Psychological Safety Compass

September 2022
The Tree of Power    

August 2022
Value Proposition Dial

July 2022
Sustainable You Model

June 2022
Change Manager’s Toolbox

May 2022
Corporate Value Creation Model

April 2022
Organizational System Map

March 2022
Creativity X-Factor

February 2022
Strategic Alignment Model

January 2022
Market System Map

December 2021
Team Building Cycle

November 2021
Disciplined Dialogue Model

Oktober 2021
Strategy Hourglass

September 2021
Powerhouse Framework

August 2021
Fruits & Nuts Matrix

July 2021
Everest Model of Change

June 2021
Followership Cycle

May 2021
Knowledge Sharing Bridges

April 2021
Innovation Box

March 2021
Empowerment Cycle

February 2021
Digital Distribution Model Dial

January 2021
Digital Product Model Dial

December 2020
4C Leadership Levers

November 2020
Rebound Model of Resilience

October 2020
Strategic Bets Framework

September 2020
Storytelling Scripts

August 2020
7I Roles of the Corporate Center

July 2020
Strategy Development Cycle

June 2020
Rising Star Framework

May 2020
The Control Panel

April 2020
Strategic Agility Model

March 2020
Leadership Fairness Framework

February 2020
11C Synergy Model

January 2020
Competition Tornado

December 2019
Confidence Quotient

November 2019
House of Engagement

October 2019
Revenue Model Framework

September 2019
Interaction Pressure Gauge

August 2019
Digital Platform Map

July 2019
Mind the Gap Model


Double-click to edit button text. crossarrow-leftcross-circle