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Shared Service Centers are becoming widespread. They enable productivity gains and cost reductions. However, the process is complex and gains a lot from resorting to outsourcing.
Shared Service Centers are increasingly widespread within national and multinational companies. Many are looking to cut costs and focus on high value-added, revenue-generating activities.
Shared Service Centers: strategic advantages
Shared Service Centers (SSCs) are independent departments , internal to companies, which aim to provide a range of services to both operational teams and central teams. They allow them to optimize their resources at a lower cost, throughout the organization, while respecting the standards of customer satisfaction. It is an organizational model based on 3 main functions: people, processes, and technology. SharePoint services
Centralizing departments such as Finance, IT, Legal, Human Resources and Purchasing is often an integral part of corporate strategy. The objective is to optimize the productivity of these functions thanks to a continuous standardization of their processes, supported by a technology favoring the automation of the activities concerned.
According to PriceWaterhouseCoopers, the main benefits cited by companies that have implemented CSPs are – in addition to process standardization and increased productivity – better decision-making capabilities, better data integration and cost flexibility.
A more complex implementation than it seems
All these benefits are of course particularly attractive for multinational companies, but the implementation of the approach needs to be seriously challenged. PwC mentions, for example, many factors that can cause problems when setting up a CSP: conflicts between local managers and the parent company; difficult management of local staff; inadequate IT infrastructure and support; insufficient project management and difficulty recruiting in some countries.
CSPs can also fail in their mission when roles, expectations and responsibilities are not clearly defined at the start of the project, when there is no explicit visibility into the processes, or when technology does not provide not have the level of integration and automation needed to achieve true standardization of services.
Outsourcing, a key factor in the success of CSPs
When the implementation of a CSP is carried out correctly, it brings rapid financial and operational benefits, while limiting the impact of any problems inherent in the model. These successes reinforce the collaboration between the different services . They make it possible to centralize information and coordinate the various departments in an optimal way. To this end, they most often incorporate technology capable of managing the most complex configurations.
Many administrative functions can be transferred to a CSP and at the same time a large part of these workloads can be outsourced.
Such a function outsourcing (Business Process Outsourcing or BPO) can thus reduce the costs charged by up to 30%, or even 50% in certain cases.
BPO also speeds up all processes and minimizes risk . Functions such as IT, contract management, payroll, legal or invoicing are obviously managed more efficiently by specialists; these areas require increasingly specialized expertise, subject to complex legislative regulations…and sometimes very complex when multinationals are confronted with compliance problems linked to their multiple local establishments!
BPO solutions thus make it possible to integrate heterogeneous platforms and data, so that companies benefit from all the information available in order to improve their processes, increase their visibility and acquire greater knowledge of the market.
An opportunity for effective business refocusing
As a result, key people within organizations, relieved of the time-consuming tasks and risks of error inherent in these very specific areas, can concentrate entirely on activities that generate real benefits for companies.
For optimal results, it is necessary that companies and their CSPs are perfectly aligned. One of the major concerns of a company is therefore to optimize its CSP in order to be able to concentrate on its strategic activities.
The outsourcing of functions fully meets these objectives, ensuring better continuity of services, providing access to technology adapted to the organization and thus helping the company to succeed in its mission: to optimize its resources, reduce its costs and ensure business growth.
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