Shared services is a business strategy for increasing shareholder value, reducing costs and improving the quality of internal service functions in the areas of finance, human resources, information technology systems corporate communications and purchasing.
In brief shared services is about creating an internal marketplace for these functions and about these service groups operating as if each were a business.
Historically internal service functions have moved between centralisation and decentralisation and more recently outsourcing, to reduce costs increase internal effectiveness and improve accountability.
Ultimately the move to shared services enables the operating units to focus more intently on their core business without having to manage corporate service functions.
For employees there is an opportunity to be part of a value adding function with higher service quality that specifically meets the expectations and needs of internal customers
It is not an easy strategy to implement, it requires strong and visible leadership from the top. This process will include a compelling business case, the design of pricing and costing models and benchmarking etc
CPA Australia in conjunction with CMA Canada has released a business management guideline addressing the issues in adopting a shared services solution.
This practical guideline is addressed to the senior management and more specifically to the management accountants in both operating and corporate services who may be asked to participate in or initiate a shared services strategy.
This guideline is applicable to all levels of an enterprise, all business sectors, public and private sectors and small, medium and large organisations.
The guideline distinguishes between a basic model and a marketplace model. It clearly describes the essential features of a Shared Services function and provides a clear rationale for pursuing a shared services solution.
The guideline describes in detail the three fundamental phases in determining how to implement a shared services solution. These phases are:
analysis
design
start-up
The lessons learned from organisations that have implemented a shared services strategy are included in the guideline and advice on measuring the success of the implementation provide a good starting point for performance measurement.
Centre of Excellence comments
The main theme of the paper is the evaluation and implementation of a shared services structure, with 20 of the 30 pages providing an outline of the recommended process. It is clearly practical in nature, with many examples, and despite the fact that many of its quotes are from 1996 and 1997 it provides a good review of the necessary steps.
It is targeted at senior management and management accountants, however it addresses primarily the evaluation and management of the implementation of a shared services centre, and so has general interest as well.
The paper defines the purpose of a shared services centre, has clear steps for evaluating the need for it, and practical guidance for its implementation.
This page is available online at:
http://www.cpaaustralia.com.au/cps/rde/xchg/cpa/hs.xsl/722_7192_ENA_HTML.htm
