When thinking about the different functions that will migrate to a shared services center, it may be easy to identify which teams or processes will become part of this new organization; areas such as finance, procurement, IT, and HR are all common back-office support functions that become its pillars. However, it can be much more challenging to determine how it should be organized in order to maximize synergies and efficiencies without losing quality and degrading customer service.
Leadership is Key
One of the biggest mistakes we have observed is when a top-heavy organization manages the various groups and functions within the shared services team. For example, moving the entire finance team into the shared services center - including the leadership, mid-level managers, and the junior-level resources (who are primary in executing the various activities) - tends to become redundant when you replicate that for procurement, IT, HR, and any other areas that are now becoming part of it.
To avoid this, consider identifying leadership that can work acrossthese groups, overseeing the procurement processes, and finance and HR functions. Designating a shared services leader will accomplish several goals including:
- Reducing overhead costs for multiple senior resources at a higher cost;
- Driving a more holistic approach to how the shared services organization functions with someone who can look across teams to understand where bottlenecks are created, where processes may be duplicated, or where teams are doing work outside their scope that could be managed by another area within the organization;
- Providing consistency and a single point of contact for business stakeholders outside of the shared services organization.
Seek out a shared services leader who embodies the qualities needed to keep teams motivated and engaged in roles that may quickly become mundane. High turnover within a shared services organization can be costly and further erode efficiencies and cost savings initially identified. A strong leader will be able to identify areas for growth and opportunity for members within the team in order to continually develop and motivate resources who want to further develop their careers.
Having a strong leader in place who can become a true partner and help to drive the change management aspect of the migration to a shared services center will also help to ensure its success, and that the business and resources are excited and engaged in new service delivery model.
Enable Leadership with Strong Project Management
To support this leader, the organization should implement a Program Management Office (PMO) to assist the Global Process Owners (GPO) in order to ensure improvements are made on transitioned processes, especially if they are a “lift and shift” (moving processes in their current state). Additionally, a PMO can produce the analysis, reporting, and benchmarking of various metrics across the entire shared services center. This can also help to drive efficiency across teams by standardizing the types of metrics and reporting that is provided, while also streamlining the information for leadership and the GPOs both within the shared services center and for reporting purposes to other areas of the business. To provide consistency and cohesiveness, these PMO resources can help to bridge the gap between all functions within the shared services center and key business stakeholders.
Provide Adequate Resources
Another area for consideration relates to the resources that will perform the daily functional tasks. A one-to-one migration of roles will not always work in this model, especially when moving the team from an onshore to an offshore location where skillsets and levels of expertise may be different. For the short term, the organization may need to replace each onshore resource with the equivalent of multiple offshore ones. This should be considered when evaluating the costs of moving to a shared services model. Organizations should also plan to have the subject matter and process experts who previously performed or oversaw the newly migrated functions closely involved in training the new resources.
With a significant impact across many areas of the organization, moving to a shared services center can be a big change for your staff and business operations. Taking the critical steps to consider these aspects of the organizational structure, and specifically the leadership for the new shared services team, you can feel confident that you are setting up a center for success.
Interested in learning more about shared services?
View our guidebook for an insight on the critical considerations and options organizations should evaluate before, during and after pursuing a shared services delivery model.