What is Shared Services ?
A shared service is a capability that is centralized within an organization or group. The capability is wrapped in a service with a well defined service contract with the expectation that all teams use the service unless they can justify a reason to go their own way. Shared services are a common operational strategy designed to reduce costs by eliminating repetition of effort. By providing a service in one place, there is an opportunity to optimize and standardize it at scale.
Offering of Shared Services Strategy Solution :
NovelStrat Executive Strategy strongly believe in leveraging the common IT solution services, policies, governance framework to best utilize their investment and reduce ongoing operational cost. NovelStrat professional take pride in doing discovery exercise thoroughly, and creates loosely coupled solution so that it is easy to be adopted in most or various business models.
Key Steps for successful implementation of shared service model:
- Clarity of Requirement: Document all necessary information along with purpose/requirement of transitioning to a shared service model.
- Define of Scope: Determine all scopes and agreements between different teams along with employee engagement to take all critical decisions and decide key criteria.
- Phase-wise Implementation: Give preference to phase wise implementation to implement smaller services first so people can be more comfortable for usage of shared services and explain the improvement based on their requirement, this will lead more collaboration among teams and lead to widely adaption of shared services successfully for complex solutions too.
- Simplify existing Solution: Write down the complex part of existing solution/service and try to simplify them before commence of shared service to make it cost optimize.
- Strong Governance: Establish a good governance system to ensure processes are standardized from end to end and remain so. Avoid deviations or exceptions from standard that might erode effectiveness of the shared service center. This is meant to preserve the integrity of the process and prevent “complexity creep.”
- Clarity on charges: Costing/Charges of shared services will be clearly defined and accepted by departments/teams nominated for using of shared services solutions once implemented and implementation cost will be divided across departments equitably based on their agreement.
- Change management and involvement: Make sure to change management process will be followed effectively and involvement of existing teams working on current solution will be encouraged and well appreciated on every level of implementation to retain key resources of teams for long run of business even after transition to shared services.
- Organization effectiveness in long run : Ensure sufficient measures are in place and should be followed in long run of business as measure can be included but are not limited to following factors : i) Performance: Revenue per Full Time Equivalent (FTE), Sustainable cost savings, Improvements and efficient in end-to-end processes ii) Quality: Employee Satisfaction, Customer Satisfaction iii) Overall: Return on Investment (ROI)
- Smart Technology: Many may assume that the technology platform will solve all issues to a shared service model. Consideration should be made about any past work-around, patches or complex processes built around existing technological platforms. Time needs to be devoted to determining how a facility works from end-to-end on various processes.
- Utilize Service Level Agreements (SLA) as a communication and relationship-building tool: While the SLA is often used for outsourcing it is found to be an effective communication tool between the Shared Service Center and Facilities or Business Units. Describing up front who is responsible for what will build credibility for the Shared Service Center and minimize boundary disputes down the road.