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More Companies Adding Shared Services Centers to Deliver Bottom Line Value

More Companies Adding Shared Services Centers to Deliver Bottom Line Value

by CFO Innovation Asia Staff, 21 April 2011
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More organisations are delivering incremental value to their bottom line through strategic and effective implementation of shared services initiatives, according to the results of Deloitte’s sixth biennial Global Shared Services Survey.

 

The global survey of 270 executives shows an 11 percent increase in the number of Shared Services Centers (SCCs) per company since 2009, with companies reporting benefits that go beyond cost reduction, such as improved controls and processes, increased data visibility and new opportunities for growth.

 

“Most organisations are being very thoughtful about how to sequence their shared services implementation and/or expansion, carefully weighing the pros and cons of how to time the changes,” says Susan Hogan, principal, Deloitte Consulting LLP and service delivery transformation practice leader. “To fully leverage the value of shared services initiatives, companies need to align their approach with the broader business strategy, and the power of the organisation’s culture cannot be underestimated or ignored. Heavy focus on change management elements such as communication, training, and executive alignment are critical."

 

Additional key findings revealed in Deloitte’s 2011 Global Shared Services Survey include:
    * The U.S. has the most well-established shared services market with more than 44 percent of the centers which are over 10 years old, according to survey respondents. However, four out of five centers less than three years old are being set up outside of the U.S.
    * Labor factors continue to drive location selection for SSCs — quality, availability, and language skills — while cost stays top of mind and sustainability considerations become a factor.
    * Middle market companies are implementing shared services more frequently, driven by the same needs as those of larger companies, and now viewed as a demonstrated platform for improving delivery and reducing costs.
    * Cost reduction is considered table stakes and quality of services is the most important selling point for long term satisfaction by companies that “opt-in” to share services.
    * SSCs are expanding into new functions such as real estate, sales & marketing and legal following the success and credibility demonstrated among established transactional services such as finance, HT, IT and procurement.

 

 

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