The shared services organization (SSO) concept can help because it consolidates support operations into a service-oriented organizational unit and can substantially improve operating efficiencies by eliminating duplication and streamlining processes.
Establishing an SSO (in concept, of course) can be simple, however, the organizational and human implementation components can make the task quite difficult. Additionally, optimizing its performance is often a challenge. Depending on the maturity of the enterprise and of the SSO, the SSO can run as its own commercial grade business -- always seeking to deliver the highest quality, while being the lowest cost provider of services. If done right, optimized SSOs have proven to be a value center as well as a cost reduction center.
Another advantage of shared services is the convergence and streamlining of an organizations functions to ensure that they deliver to the organization the services required of them as effectively and efficiently as possible. This often involves the centralizing of back office functions such as HR and Finance but can also be applied to the middle or front offices.
A key advantage of this convergence is that it enables the appreciation of economies of scale within the function and can enable multi-function working (e.g., linking HR and Finance together), where there is the potential to create synergies.
Successful implementations integrate processes, people, information, and technology automation to deliver a totally new set of capabilities. The benefits are many:
As many organizations have realized, the journey to become an optimized SSO requires desire, discipline and the ability to execute a plan. Furthermore, optimizing service delivery is more than simply moving people into one location and giving them one system. It involves a change in mindset and an increased focus on the business.
Faisal Hoque is an internationally known entrepreneur and author, and the founder and CEO of BTM Corp. His previous books include Sustained Innovation and Winning The 3-Legged Race. BTM innovates business models and enhances financial performance by converging business and technology with its products and intellectual property. His next book, The Power of Convergence, will be available in May 2011.