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Companies have realized some of the expected savings in their Shared Services Centers, but HR costs per employee continue to rise. To remain strategically aligned, HR Shared Services Centers need to move quickly beyond transactional activities to include development and staffing, and widen their geographical scope.

There is no magic for making outsourcing initiatives successful; it comes down to a number of different factors - all performaing effectively together like a finely tuned orchestra. If you are going to succeed, you should, at the very least, address three key areas: build success criteria into the deal from the start, know your baseline, and measure what matters to your customers.

Uncertainty and fear can breed resistance and disaffection that, in turn, lead to reduce productivity and profitability. It is critical to address human and psychological factors in a positive way and so as to ensure any re-organization or outsourcing of functions results in enhanced business performance.

With regards to technology, three types of decisions need to be made: whose technology is to be implemented, who is to drive and own the configuration, and how to coordinate the retained processes seamlessly with those that are outsourced. All have implications for the sustainability of a BPO relationship.

Quantifying and designing the retained organization go hand in hand with the project’s business case and require adopting a structured approach. The retained organization roadmap has been designed to enable you to better predict your return on investment.

Who or what is to blame when outsourcing contracts fail to deliver on their initial promises? Mike Friend, Managing Director of M3C Consulting, looks at the role of governance in outsourcing contracts, how risks can be better managed and some key steps that customers and providers can take to better ensure against failure.