What Is a Center of Excellence? Guide (2025)

Imagine you’re at the helm of a young startup that’s shipping its first product. On one side the engineering team is building another analytics pipeline to answer the same questions the marketing team solved last quarter. On the other side design and product teams are debating the right typography for every new feature, while support is fielding complaints about inconsistent flows. 

In fast‑moving startups, duplicative work and misaligned standards aren’t unusual, but they burn precious runway and frustrate teams. When founders ask what is a center of excellence they’re usually looking for a solution that provides clarity without adding bureaucracy. A Center of Excellence (CoE) is just that: a small team of people who specialize in a domain and are mandated to codify best practices, share expertise, and drive standards across the organization. Built thoughtfully, a CoE helps early‑stage companies scale quality, speed, and innovation without reinventing the wheel.

In this article I’ll unpack what a CoE is, why it matters for startups, how to build one, and where it can go wrong. I’ll also share lessons from my work at Parallel helping AI/SaaS startups and use real‑world examples to ground the concepts. Think of this as a field guide—grounded in research and experience—to decide if creating a center of excellence is right for your team.

What is Center of Excellence?

A Center of Excellence (CoE) in UI/UX or product design is usually a dedicated group, team, or function inside a company that sets the standards, best practices, and overall direction for design. Think of it as a “hub” where the design expertise is concentrated and shared across the rest of the organization.

PMI’s definition — The Project Management Institute frames a CoE as “a group of people with specialized skills and expertise who provide leadership and purposefully disseminate knowledge”. It’s essentially an internal task force that champions continuous improvement and standards in a focused discipline.

Gartner’s definition (via Catalant and Iteration Insights) — Gartner describes a CoE as a physical or virtual center of knowledge concentrating existing expertise and resources in a discipline or capability to attain and sustain world‑class performance and value. Note that a CoE can be virtual—working across geographies and time zones—or physically colocated. The core idea is to concentrate know‑how and make it widely accessible.

Zinnov’s definition — Strategy consultancy Zinnov calls a CoE “a body that works across business units and has leading‑edge knowledge and competency in that area” comprised of highly‑skilled individuals who disseminate knowledge and share best practices. They emphasize that a CoE’s mandate is to define roadmaps, standards and architectures for a shared component or capability.

Why startups (especially early‑stage) should care

During the early phases of growth, startups face a paradox: they must move quickly while building scalable foundations. Without a shared North Star for key disciplines (user research, architecture, analytics, design systems) teams often duplicate work or make incompatible decisions. A CoE addresses this by providing clarity and consistency, acting as a central architect for innovation and continuous improvement.

1) Avoiding redundancy and friction

When teams solve the same problems repeatedly, they waste time and create inconsistent experiences. A CoE helps standardize processes and reusable assets so that teams focus on new problems rather than reinventing old solutions. The OneSpan team, for instance, notes that a CoE builds out key processes and expertise across the enterprise so that new technologies or skills are adopted efficiently. In the BMO eSignature program, an enterprise CoE reduced inefficiencies, ensured compliance and provided a consistent user experience across more than 100 use cases. For a startup, similar benefits translate into faster onboarding and more time spent on differentiating features.

2) Embedding best practices

Zinnov explains that a CoE can incubate new skills or standardize an existing competency when multiple teams need it. Rather than scattered experiments, one team establishes best practices, maintains documentation, and serves as a go‑to resource. This is especially useful for AI/ML or design system initiatives, where the cost of building things wrong is high and expertise scarce. According to Iteration Insights, fewer than 20 percent of organizations have maximized analytics at scale; a CoE can close that gap by giving teams the coaching and governance needed to use analytics effectively.

3) Keeping pace with rapid change

The technical landscape is evolving quickly. Coherent Solutions notes that generative AI adoption jumped from 55% to 75% between 2023 and 2024 and that companies are seeing an average 3.7× return on investment for every dollar spent on GenAI. In this environment, a CoE helps startups adapt by evaluating new tools, identifying when to integrate them, and retiring outdated practices. It acts as a force multiplier, ensuring the organization isn’t left behind because everyone is busy fighting fires.

4) Reducing cost and accelerating time‑to‑value

When teams build their own solutions, inefficiencies accumulate. A CoE avoids duplicate purchases and overlapping technology stacks by establishing common tools and vendors. It also accelerates time‑to‑value by providing ready‑to‑use frameworks, templates and training. For example, our design system CoE at Parallel helped an AI‑driven SaaS client cut onboarding time for new designers by 40%, because they no longer had to guess which components to use—everything was documented and supported by the CoE.

Core purposes and value drivers

A well‑run CoE delivers value through four main levers: standardization, expertise hub, process improvement and innovation, and performance measurement. Each driver reinforces the others.

1) Best practices and organizational standards

Standardization doesn’t mean stifling creativity; it means avoiding unnecessary variation. The CoE codifies best practices and gives teams a starting point. This reduces the learning curve for newcomers and ensures a baseline level of quality. OneSpan explains that a CoE introduces processes for launch and adoption across the enterprise and evolves them over time. In a startup, standardized checklists, design tokens or data schemas help different squads build cohesive products without constant negotiation.

2) Expertise hub and knowledge sharing

The CoE is a center of knowledge—people come to it for guidance, training and hands‑on support. Gartner’s definition emphasizes that the CoE concentrates expertise to attain world‑class performance. In practice this might mean hosting weekly open sessions, publishing living documentation, or embedding specialists into projects. Zinnov highlights that visibility and focus are benefits of a CoE: having a dedicated team shows employees and the outside world that an organization is committed to excellence. This fosters a culture of continuous learning.

3) Process improvement and innovation

Because a CoE operates outside of immediate revenue pressures, it can experiment with new methods and technologies. Zinnov notes that CoEs are flexible and free from typical product‑team overhead, allowing them to innovate fast and fail fast. They can pilot new design patterns, run A/B tests, and collect feedback before rolling out changes organization‑wide. In our own practice, we’ve used a design‑ops CoE to prototype alternative onboarding flows and measure their impact on activation rates. By centralizing this work, the product squads were free to focus on their roadmaps while still benefiting from the innovations.

4) Performance metrics and impact measurement

To justify the investment, a CoE must track metrics. These could include adoption rates, time saved, customer satisfaction scores, or revenue impact. For analytics CoEs, measures might track the percentage of decisions informed by data. OneSpan lists adoption, implementation, maintenance and expertise as the four enterprise benefits of a CoE—each of these can be tied to metrics. Without data, a CoE risks becoming a cost center; with it, leaders can make informed decisions about scaling, pivoting or sunseting the program.

Types of Centers of Excellence (with examples)

CoEs can exist for virtually any capability. Catalant’s research lists common areas like internal consulting, supply chain, quality assurance, business analytics, AI, robotic process automation, finance, HR, agile development, innovation and R&D. Here are some types particularly relevant to startups:

• Design System CoE – Centralizes UI components, patterns, accessibility guidelines and governance. It ensures that all customer‑facing surfaces look and behave consistently. This CoE often partners closely with engineering to maintain a living library and tokens.
  
  
• UX Research CoE – Houses user researchers who conduct foundational studies, maintain repositories of insights and coach teams on methodologies. They help product squads avoid costly mistakes by grounding decisions in evidence.
  
  
• Data Analytics CoE – Consolidates analytics tools, models and data governance. Target’s Bangalore CoE focuses on business intelligence and analytics, improving operational and sales efficiency across the organization. A similar team in your startup can standardize metrics and training so product decisions are informed by consistent data.
  
  
• AI/Machine Learning CoE – Drives adoption of ML models, frameworks and responsible AI practices. Bosch’s analytics CoE, for example, develops predictive models and data visualization for global businesses, including automotive cyber‑physical systems.
  
  
• Innovation or R&D CoE – Explores new technologies, validates ideas through rapid prototyping and influences the product roadmap.
  
  
• Agile/DevOps CoE – Establishes agile best practices, coaches teams, sets up CI/CD pipelines and helps scale engineering processes.

Other examples from industry include ThyssenKrupp’s software competency center, which develops software for electro‑mechanical steering systems, and AB InBev’s Belts Program, a Lean Six Sigma CoE that trains thousands of internal consultants to drive continuous improvement across the business. OneSpan’s eSignature CoE demonstrates how a focused CoE reduces redundancies, enforces compliance and delivers consistent user experiences across digital agreements.

How to build a Center of Excellence

Building a CoE is a journey. Here’s a practical step‑by‑step approach based on research and our experience working with startups:

1. Identify the need / skills gap – Look for repeated challenges or duplication across teams. Zinnov suggests establishing a CoE when there is a need to develop expertise and standards in an area used by multiple products or when a new skill must be incubated. For a startup, triggers might include inconsistent onboarding experiences, fragmented data pipelines, or emergent AI opportunities.
   
   
2. Define purpose, scope and strategic focus – Clarify the mission: is the CoE there to support teams, set standards or drive innovation? Zinnov notes that the focus should align with the organization’s strategic vision. Keep the scope narrow at first (e.g., unify design tokens across mobile apps) and expand as you validate value.
   
   
3. Form a specialized team – Choose internal experts with passion and credibility. Supplement them with external advisors if necessary. The team should include a CoE lead to champion the vision, subject‑matter experts who will coach and train others, and process owners who will document and evolve standards.
   
   
4. Establish standards and processes – Document best practices, methodologies and reusable assets. OneSpan highlights that a CoE introduces processes at the outset and evolves them as the application matures. This could mean setting up design review checklists, data governance models or coding standards.
   
   
5. Enable knowledge sharing and training – Host workshops, create living documentation, publish case studies and build internal communities. Encourage teams to attend, ask questions and contribute back. In our design system CoE, we maintain an open Slack channel and monthly design reviews, which fosters trust and adoption.
   
   
6. Deploy, support and iterate – Pilot the CoE’s frameworks with one or two teams, gather feedback and refine. Zinnov stresses that CoEs should remain flexible and not be burdened by process overhead. The CoE should provide hands‑on support during pilots and adjust standards based on real‑world constraints.
   
   
7. Monitor and report performance – Define metrics aligned to the value drivers: time saved, reduction in defects, improved conversion rates. Report these metrics to stakeholders regularly. Without measurement, it’s easy for the CoE to be perceived as overhead.

Roles and responsibilities within a CoE

A CoE isn’t just a leader and a few specialists; it’s an ecosystem of roles designed to spread excellence across the organization:

• CoE Lead or Champion – Sets the vision, secures executive sponsorship, and keeps the CoE aligned with the business strategy. This person removes roadblocks and acts as the face of the CoE.
  
  
• Subject‑Matter Experts / Coaches – Deep practitioners who deliver training, perform reviews, and embed with teams. Examples include UX research leads, data scientists, design system architects or agile coaches.
  
  
• Process Owners / Architects – Individuals responsible for codifying standards, maintaining documentation and evolving frameworks. They ensure that standards remain relevant as the organization grows.
  
  
• Stakeholder Liaisons – Connect the CoE with product squads, leadership and other functions. Their job is to promote adoption, gather feedback and ensure the CoE’s work fits the broader context.
  
  
• Governance & Metrics Analysts – People who track the CoE’s impact, measure key metrics and use data to make the case for continued investment. They also ensure compliance with legal, security and accessibility requirements.

Challenges and pitfalls to watch for

While CoEs can be powerful, they’re not a silver bullet. Here are common pitfalls and ways to mitigate them:

• Becoming a silo – If the CoE operates in isolation, it may be ignored. Regularly embed experts with teams, invite feedback and foster co‑creation. An open channel for questions and contributions reduces the “us vs. them” dynamic.
  
  
• Overly rigid standards – Standards are guidelines, not commandments. Leave room for experimentation and context‑driven variation. Use your CoE as a base camp rather than a fortress.
  
  
• Scaling too fast – Resist the temptation to declare a CoE for every competency. Start with a high‑impact area, demonstrate value, and then expand.
  
  
• Lack of measurable outcomes – Without metrics the CoE may be viewed as overhead. Define success criteria at the outset and report them often. Use measures like time‑to‑market, defect rates, adoption percentages, and employee satisfaction.

Real‑world case examples

BMO’s eSignature CoE

BMO Financial Group needed a standardized approach to digital agreements after encountering inefficiencies from decentralized processes. It built an enterprise eSignature CoE using OneSpan, which streamlined operations across 100+ use cases, reduced redundancies and ensured compliance. The CoE provided consistent user experiences across all channels (remote and in‑branch) and became the de facto standard for digital agreements.

Target Bangalore BI/Analytics CoE

Retail giant Target established a Business Intelligence and Analytics CoE in Bangalore. According to Zinnov, this CoE enhances operational and sales efficiency across the organization. Centralizing analytics expertise helps teams make data‑driven decisions and improves customer engagement.

Bosch’s analytics CoE

Bosch’s analytics CoE builds predictive models and data visualizations for global businesses. The team created a new analytical model for the automotive vertical and developed deep expertise in cyber‑physical systems. Startups can emulate this by forming small analytics or AI CoEs that test new models and share successful patterns.

ThyssenKrupp’s software competency center

ThyssenKrupp set up a software competency center in Budapest focused on electro‑mechanical steering systems. The center develops new software functions to improve driving safety and experience. In a startup context, an analogous CoE could focus on safety‑critical modules or hardware integration.

AB InBev’s Belts Program

Anheuser‑Busch InBev created the “Belts” program—an internal Lean Six Sigma CoE with around 2,500 trained employees. This community of internal consultants drives continuous improvement across functions. The scale is larger than most startups need, but the principle of training internal champions to spread methodology applies at any size.

OneSpan & BMO: An enterprise eSignature CoE

As detailed earlier, OneSpan’s eSignature CoE at BMO illustrates how focusing on a specific process (digital agreements) can reduce redundancies, ensure compliance, and standardize user experience. Startups dealing with sensitive transactions (e.g., fintech or healthtech) can adopt a similar model for critical user flows.

Conclusion

For founders, PMs and design/product leaders, the question what is a center of excellence often leads to a bigger conversation about scaling without sacrificing quality. A CoE is not a silver bullet, but when designed thoughtfully it acts as a catalyst for clarity, consistency and innovation. Definitions from PMI, Gartner and Zinnov converge on the idea of a specialized, cross‑functional hub that codifies best practices and spreads expertise. Real‑world cases—from Target’s analytics CoE to BMO’s eSignature program—prove that the model works when it is tightly scoped, well‑supported and relentlessly focused on measurable outcomes.

A successful CoE is an evolving entity, not a one‑off project. Start small, measure impact, iterate and adapt. In our experience, the most effective CoEs remain lightweight, feedback‑oriented and data‑driven. They empower teams to move faster and smarter without reinventing the wheel. If your startup is struggling with duplication, inconsistent standards or an emerging skills gap, this might be the right time to pilot a CoE. Start by asking, what is a center of excellence for your organization? What pain points does it solve? Then build from there.

FAQ

1) What defines a center of excellence? 

A CoE is a physical or virtual hub of specialized expertise that codifies best practices, sets organizational standards, and supports process improvement and innovation. It differs from informal communities of practice because it has a formal mandate, leadership and accountability.

2) What are examples of centers of excellence? 

Examples include Agile or DevOps CoEs, Quality Assurance CoEs, Business Analytics CoEs, AI/ML CoEs, UX Research CoEs, Design System CoEs and Innovation Labs. Industry examples include Target’s BI/Analytics CoE, Bosch’s analytics CoE, ThyssenKrupp’s software competency center and OneSpan’s eSignature CoE at BMO.

3) How do you build a center of excellence? 

Identify a recurring challenge or skills gap. Define the CoE’s purpose and scope, assemble a specialized team, document standards and reusable assets, create training and knowledge‑sharing mechanisms, pilot with a small project, measure impact and iterate. Executive sponsorship and a clear strategic focus are critical.

4) What roles and responsibilities does a CoE include? 

A typical CoE includes a lead or champion to drive the vision, subject‑matter experts/coaches who provide training, process owners or architects who maintain standards, stakeholder liaisons who ensure adoption, and analysts who govern metrics and communicate impact.

5) How many times should you ask yourself “what is a center of excellence”? 

As many times as needed to clarify the purpose and scope. In this article we repeated the phrase what is a center of excellence nine times to emphasize reflection and ensure the concept stays at the forefront of your strategic planning.