Shared Services Centers have become a vital resource in any significant HR transformation project and process realignment initiative within major companies. The SSC solution attempts to address the need to optimize the cost of transactional HR processes while simultaneously enabling HR to dedicate more resources to talent management.
Here you'll discover that Shared Services Centers are more than just centers to optimize costs. The ability to better control information and improve organizational effectiveness are also valid motivations to consider Shared Services Centers as part of the HR transformation scope.
The New Normal Part 3: Embracing the Digital Age through Innovative HR Approaches
We are at the halfway mark in a revolution where all things are becoming digital.
The first part of the revolution has passed and the next leg will mark an increasingly digital society with fundamental shifts in attitudes and behavior. In twenty years’ time managers will have grown up with the New Normal and will be digital natives. However, the next few years will impact organizations significantly as they come to terms with how they need to be organized internally.
In this article, we look at how companies can embrace the digital age and cultivate the New Normal through innovative HR practices.
| 0 comments |The New Normal Part 2: Designing organizations to accommodate Digital Natives
The concept of the New Normal states: ‘We are halfway through the digital revolution.’ Over the next few years’ technology will become a part of everyday life, and the outcome will inevitably be a society without digital limits.
Digital has become the New Normal, and the next few years will impact organizations significantly as they come to terms with how they need to be organized internally. In twenty years’ time managers will have grown up with the New Normal and will be digital natives. But today, how can companies accommodate the New Normal generation currently entering the workforce while still meeting the needs of the analog generation?
In this article, we look at how to bring together the analog generation with the younger, networked generation and how HR will play a vital role in this process.
| 0 comments |The New Normal Part 1: Three new realities companies must embrace today
The New Normal refers to all things we call 'digital'. 'We are halfway through the digital revolution,' states the concept. Digital is becoming the new normal. In a society where technology is becoming a normal part of everyday life, the outcome will inevitably be zero tolerance for digital failure.
The next few years will impact organisations significantly as they come to terms with how they need to be organised internally, and address a society without digital limits. In twenty years' time, managers will be digital natives who have grown up with the New Normal. But at present, how do we bring together the analog generation with the New Normal generation and still serve both communities in organisations today?
In this article, we look at the three new realities companies must urgently embrace today to keep up with the New Normal.
| 0 comments |Productivity gains? Small change in comparison with the higher stakes!
Alain Sommer, Associate Professor of Finance and Project Management in Healthcare Services at the CNAM, discusses productivity gains and how a small change can lead to higher stakes. As soon as a merger is announced, Shared Services Centers are on the agenda, with the aim of harmonizing administrative and financial processes, ensuring the accuracy of data and increasing productivity. Someone is appointed to manage the deployment of Financial Shared Services Centers, preferably with the support of a reputable firm. With a good team, it is possible to open three, four or five Shared Services Centers in Europe, America or South-East Asia within less than two years... Two years after a Shared Services Center has been set up, it is realistic to expect to have productivity gains that go a long way toward covering the cost of the transformation. Monitoring is the main advantage followed by improved financial management. The increased reliability provided by Shared Services Centers is alone worth much more than the 20 million in savings.| 0 comments |Getting the right people for your Shared Services Center
Who are the right people for your Shared Services Center? Running a Shared Services Center is about running a business, understanding what it takes to deliver services with cost, quality and timeliness that are competitive, and understanding how to motivate a large scale organization. So the right people may be the ones who are going to deliver the right level of service, one that fits the end-users needs. This requires a specific mindset and is not for everyone.| 0 comments |Getting the right people for your Shared Services Center
In this video, Andrew Kris, Consultant Director of Borderless Executive Search, discusses getting the right people for your Shared Services Center. "Just because you have a terrific finance person who really understands finance--is this the right person to lead your Shared Services Center? I don't think so," he says When we're talking about Shared Services, the number one issue that comes up is that headhunters get called in usually at the third phase of failed Shared Services Centers. What about the other people that are working in this service business? if you've worked in the back office, finance function or Human Resources function for many years, have always thought you've known what your customers needed, and attempt to deliver things the same way as before, you are setting yourself up for failure. If you really feel you don't have the right people in place, go to another location where you can build from scratch. Take the hit, painful as it is.| 0 comments |How to attract, develop and retain staff in a Shared Services Center
ADP Globalview Europe's former HR Director Jean-Jacques Bellon outlines the factors that attract, develop and retain staff in a Shared Services Center. Five years ago, ADP selected Prague to be the location of the new Shared Services Center dedicated to ADP GlobalView, a complete payroll offering for large multinationals. One challenge when starting out in a new country is appealing to potential recruits, especially when the labor market is highly dynamic as is the case in the Czech Republic. The business of the Prague Shared Services Center requires cutting-edge skills: SAP expertise, knowledge of payroll in European countries and Customer Relationship Management (CRM) tools, fluency in English, etc. Middle management plays a key role in spotting talent in the making. It is on the frontline when it comes to assessing employees' potential by their attitude, relationship with clients, interpersonal skills, and ability to grasp and resolve complex situations. One indicator on the Human Resources team's scorecard is particularly important for monitoring the center's development: staff turnover. At the Prague center, it is controlled and stable around 15%. But, a stable workforce is pointless if its individuals do not perform collectively.| 3 comments |Overcoming resistance to Shared Services Centers initiatives
Webster Co-Founder of Webster Buchanan Research Keith Rodgers discusses the causes and sources of resistance and ways of overcoming them to Shared Services Centers' initiatives. Ask a Human Resources or payroll manager about his/her experiences in setting up and managing a Shared Services Center (SSC), and at some point the conversation will invariably turn to people-related challenges. Every transformational change project runs into some level of internal opposition, but resistance to change in Shared Services Center projects can be particularly strong. The first step toward overcoming resistance is to understand the drivers. What is it that makes some top executives, line managers, and employees—even entire business units—rigidly oppose to change? A second set of drivers of resistance comes from the business case, where cost savings tend to dominate the internal debate at the expense of factors that may have a stronger appeal for those directly impacted by the initiative. Even with a sound business case, full backing at the executive level and an experienced project team, some level of resistance is inevitable in a Shared Services Center initiative. By understanding and predicting the causes, establishing a comprehensive communications plan and adopting best practices and pragmatism in people management, the impact of resistance can be mitigated.| 0 comments |Transforming the finance function through Shared Services Centers
George Connell, Royal Dutch Shell’s Head of Strategy and Business Development in Finance Operations, talks about transforming the finance function through a global network of Shared Services Centers. Royal Dutch Shell Energy currently has 5 Shared Services Centers around the world for the finance function. They handle a large number of processes including accounts payable, data management, general accounting processes and management information for the group. The Finance Shared Service organization was established in 1998. It more recently progressed to become the Finance Operations division with sharp focus on excellence, reflected in its process-based structure and orientation. Shell’s Shared Services journey has certainly benefited from senior leader support. George Cornell believes this is essential as the Shared Services Centers have brought about a fundamental change in the finance footprint. To make Finance Shared Services a success, Shell also learned from experience. They made the decision to follow the branded captive model, having the centers in-house, to help integrate Finance Operations with other organizations within Shell. Today, Finance Operations are taking over new processes and entering new areas including information management, planning and budgeting.| 1 comments |The challenge of Shared Services Centers? Controlling information! Cost reduction? A natural spin-off
Groupe SEB’s Deputy General Manager of Finance Jean-Pierre Lac discusses the challenges Shared Services Centers are facing. “The real challenge of Shared Services Centers”, as Jean-Pierre Lac insists, “is to control information. The challenges are not only financial, but also operational. Anyone can understand that unity is strength, but resistance to change is even stronger. Jean-Pierre Lac explains that the accounting departments must not cost more than the Research and Development. Harmonizing procedures and centralizing are not enough. A Shared Services Center is a third type of entity, both custodian of the group’s rules and service company working for its internal clients. The same logic now also applies to Human Resources (HR), with the same challenge and with the same natural spin-offs: controlling information…and reducing costs.| 0 comments |Building an effective Shared Services Center Transcript
In this video transcript, Borderless Executive Search’s Consultant Director Andrew Kris talks about setting up a client relationship and delivering the right set of services in a Shared Services Center. Shared Services Centers are all about change in behaviors and attitudes that comes from delivering shared services with cost, quality and timelines that are more competitive compared with alternatives—in other words, it is all about running a business. Shared Services Centers often enable companies to benefit from lower cost as well as better quality, but it’s important to benchmark this performance with what was delivered by the former organization. Customers need to see the added-value they get. Shared Services Centers are not only about delivering services to customers. They have to deliver services people want at the right price. They also need to establish relationships with your customers. This means having people manage relationships with a particular customer or a group of customers. You will need to establish relationships with your customers, which probably means having people manage relationships with a particular customer or a group of customers.| 0 comments |Building an effective Shared Services Center
Andrew Kris, Consultant Director of Borderless Executive Search, identifies ways of building an effective Shared Services Center. Shared Services Centers are about much more than just consolidating to gain efficiency. They are also, primarily, about running a business. Businesses tend not to be very useful or sustainable without customers. The same thing applies to Shared Services Centers. The reality is that even before you start your Shared Services Center, you have to assess the current internal cost of services that are going to be delivered by the center. Bear in mind that even if not visible, all processes and services delivered internally have a cost. Shared Services Centers are not only about delivering services to customers. They have to deliver services people want at the right price. They also need to establish relationships with your customers. This means having people manage relationships with a particular customer or a group of customers.| 0 comments |The Shared Services delivery platform: your key to effective Shared Services
SAP AG’s Relationship Manager for Business Process Outsourcing (BPO) Phillip Booth and Vice-President of Solution Management Shared Services Bernhard Fischer discuss effective Shared Services delivery platforms. Shared Services has established itself as a common optimization strategy for cost, quality and risk control. Today, many Shared Services Centers operate on whatever legacy system that existed before the inception of the Shared Services Center. This may include efficiency enablers, but still leaves the Shared Services Center exposed to running numerous and different backend systems depending on the internal client it is serving or the external provider it is connecting to. The Service Delivery Platform should be specifically designed for and supportive of integration with multiple back-ends of varying vendors, providers and software releases. Our principle is to identify the incremental services that can be bolted onto the business processes used at the internal client or services provider. These bolted-on services will be similar or even the same for all internal clients, establishing a natural realm for the Shared Services Center. SAP’s Human Resources (HR) solution had been designed for a scenario in which the Human Resources Department sees itself as a service provider to employees and managers.| 0 comments |Shared Services Centers - Define reasonable guarantees of compliance, confidentiality and availability
ADP’s CSO in Europe Philippe de Araujo discusses Shared Services Centers in defining reasonable guarantees of compliance, confidentiality and availability. Setting up a Shared Services Center (SSC) means rethinking the ways individual exchange information. These flows of information must be made secure so that the service expected by clients and users is reliable. Whether internal or external, a Shared Services Center involves a change in the way individuals relate to administrative departments. The Shared Services Center transforms a one-on-one relationship into a many-to-many relationship. A Shared Services Center activity relies on its information system. Therefore, it must be well protected by backup systems, access control, etc to guarantee maximum availability. Shared Services Centers become often international, especially within major groups, as geographically scattered teams become consolidated. For cost-savings purposes, these Shared Services Centers may be partly or completely situated in emerging countries. Process modeling ensures that the results obtained and the quality of service provided by the Shared Service Centers, whether internal or external, will be in line with the commitments made to the client. In order to check compliance with Shared Services Center’s processes and possibly to audit them, it is vital to ensure traceability. It all comes back to the Shared Services Center’s job of fulfilling its commitments to its clients in terms of service and quality.| 2 comments |Shared Services Centers, a complementary path to outsourcing
Christine Stanowski, Vice President of Global Consulting, ADP, discusses how Shared Services Centers and outsourcing work in tandem in order to optimize payroll systems. Companies often weigh the pros and cons of Shared Services Centers (SSCs) and outsourcing as alternatives to in-house operations. By choosing to outsource the company’s non-core processes and boosting or reassigning resources to activities with a high added-value, Human Resources (HR) managers optimize their teams’ potential and fulfill their primary duty of using the company’s human capital to their best advantage. A multinational deploys a project to optimize multi-country payroll function on a Shared Services Center to reach these four objectives: support growth, allocate human capital to enhance performance, reduce technological risks, and meet legal compliance and governance requirements. Local requirements are critical for accurate payroll processing. Their complexity makes it a challenge for multinationals to run one worldwide payroll system in-house. The Shared Services Center has two essential roles: restructure retained processes and act as the interface between the company and its service provider. To sum up, a project to create or extend a Shared Services Center in the context of global payroll outsourcing is multi-faceted. The company must anticipate the challenges it will face as it advances toward the target organization.| 0 comments |Shared Services Centers - Cost versus profit centers
In this article, Jesper Lillelund, Co-founder and Director of CorporateLeaders, discusses the difference between Cost and Profit Centers in Shared Services Centers. Shared Services offer potential for significant savings and performance improvement across an organization. They are also the consolidation of common functions, systems, processes and people across business units into an internal service unit that is managed by an autonomous organization. When a Shared Services Center is run purely for cost reasons, it is not likely to have a sustainable outcome. Shared Services are really about servicing customers and should be run like competitive businesses. Operating a Shared Services Center as a profit center will provide an incentive to create value through further improvements in efficiency, attracting new service business from internal customers. There are many issues a company must consider when choosing how far the Shared Services Center should be run as “pure” profit center. Chargeback prices determine how far a Shared Services Center can be considered as a cost center or a profit center. Tax considerations are one of the many challenges and external implications that impact the choice of the business model. The whole concept of a Shared Services operation relies on clearly defined Service Level Agreements (SLAs) outlining the formal interface between the center and its customers.| 0 comments |The side benefits of Shared Services Centers
Director of CorporateLeaders Karsten Soderberg explains the side benefits of Shared Services Centers. In practice, companies are increasingly harvesting from other areas that are not necessarily described and articulated in the business case. The areas that we refer to in the progressive perspective are the cost of transparency, knowing the real cost of the process itself, which was not necessarily known upfront. Obtaining the transparency of cost of a given process through Shared Services or through an outsourcing deal allows you to compare against your business case and know the specific cost of that particular process and to benchmark it against best practices. Mastering successful implementation of a Shared Services Center and outsourcing deal does not only bring added value in terms of further cost reduction and process improvement, it also brings significant value in the side effects.| 0 comments |The side benefits of Shared Services Centers
Karsten Soderberg, Director of CorporateLeaders, discusses the side benefits of Shared Services Centers, particularly the hidden benefits of the business case, improved management and leadership skills as well as increased flexibility to meet market challenges. When establishing a Shared Services Center or deciding to outsource a given process, the expectations are often articulated and put forward in what is called the business case. Let’s look at the side benefits of improved management and leadership skills that are often overlooked in the business case and during the transition. When a company is going through an exercise of moving to a Shared Services Center or an outsourcing deal, people directly involved in this exercise type typically increase their management and leadership skills. Establishing Shared Services Centers or outsourcing deals and practices can also increase flexibility to meet ever-changing market conditions and business circumstances.| 0 comments |Why established HR SSCs must move beyond transactional work
Hackett Group’s Director of HR Consulting Practice Karum Zerhouni explains why established HR SCCs must move beyond transactional work. To align with and enable business strategy, shared services must move beyond transactional work and shift toward a next generation model that drives greater value. During the last decade and a half, Human Resources (HR) have been undergoing a process of transformation. Yet, despite the large scale of transformation programs, the cost of Human Resources function has been rising. The Hackett Group 2008 Shared Services Performance study reveals that a vast majority (94%) of organizations are already operating Shared Services in order to reduce General and Administration (G&A) costs and enable the execution of business strategies for growth, competitive advantage and employee engagement. To retain a dominant position, Human Resources Shared Services must move beyond the transactional processing activities and focus on the most added value activities. A large majority of Human Resources functions have now adopted multi-tiered models relying on Shared Services, Center of Excellence, Business Partners and distant channels, but all are not yet capable of exploiting them to deliver higher-value analytical task or integrating them in advanced Human Resources capabilities. The redefinition of the role of business partner, staff training and process reengineering require major conversion programs which are supported by significant investments.| 0 comments |A vital resource for HR Transformation
The Hackett Group's Director of HR Consulting Practice Karim Zerhouni explains how Shared Services Centers are vital resources for Global Human Resources Transformation. The increase on the total cost of the Human Resources function corresponds to an intended evolution. The future of companies’ Shared Services Centers is to move toward global business services. Human Resources must strategically assess and set the level of ambition for its organization’s 3-5 year horizon. It’s a multi-stage journey. The first stage is consolidation, while the next stage is standardization. Once these requirements have been fulfilled, Shared Services can move to the global business services level.| 0 comments |A vital resource for HR Transformation
In this video, Karim Zerhouni, Director HR Consulting Practice, The Hackett Group, discusses Human Resources costs as well as the challenges and the future of HR Shared Services Centers, and how to measure their performance. The total cost of the Human Resources function has increased a significant 40% over the last ten years. The more advanced organizations have chosen to optimize the cost of transactional activities while at the same time, choosing to increase HR investments in talent management processes. Fifteen years ago, who would have thought that Shared Services would become the norm to manage General and Administrative services and especially Human Resources? If we take a close look at the current situation, Shared Services have fulfilled initial expectations. Research recently conducted by the Hackett Group shows that more than 60% of organizations studied have realized a 20% increase in productivity. Their next step is to create additional benefits and greater value for end users.| 2 comments |Reasons to set up a Shared Services Center
Consultant Director of Borderless Executive Search Andrew Kris explains reasons and importance of setting up a Shared Services Center. Shared Services means making a business model for the consolidation. The reality is that most Shared Services fail when they do not see themselves as a business. Companies that are acquisitive, moving from country to country, find acquisitions a lot easier to integrate when this is done on day one. Fold your company straight into a Shared Services Center. Don’t question any longer about whether new infrastructures should be built country by country with the resulting expense and disruption. Don’t build them in the first place.| 0 comments |Reasons to set up a Shared Services Center
Andrew Kris, Consultant Director of Borderless Executive Search, enumerates reasons and importance of setting up a Shared Services Center. Shared Services means building a business—a business that delivers services inside the organization—with cost, quality and timeliness that are competitive with the alternative ways of doing the same thing. People who have thought about Shared Services as an internal business have been the most successful. And, maintaining that model applies to everything you do in your Shared Services Center. Efficiency and effectiveness are the compelling reasons for providing service internally, a service that is created as a business. There is another really good reason why many companies turn to Shared Services: fast track expansion through acquisition. In most companies, consolidating, replicating a service across an organization is almost a cyclical activity. Consolidation consisting of centralization and decentralization is just a recurring activity. It’s a flow of activity and control from the center to the outside, to the countries or to the business units, and all the way back again. That is a wonderful thing to do, but that is absolutely not Shared Services.| 0 comments |Shared services - Deciding between internal and outsourced models
In this white paper, SAP examines and elaborates internal and outsourced models of Shared Services. Shared Services can either be internal or external, in the form of Business Process outsourcing (BPO). To decide which is best for their purposes, as well as how to design processes and technology to harness shared services’ potential, company executives must assess their own situation and business processes closely. There are a number of obstacles to success in service centralization; crafting an effective “extended enterprise” that works seamlessly across organizational boundaries is not easy and requires a strong understanding of process and technology. The effect of software and its deployment on centralization’s success is analyzed: business decision makers must understand the potential and constraints of process and technology design to make realistic strategic decisions and direct their teams appropriately. Finally, we examine tenets of successful transformation and implementation. The problems inherent in these steps are not only relevant for the implementation team, but also should be understood by those executives involved in strategic decision-making.| 0 comments |Into the heart of a shared services center
What really happens when some tasks are no longer performed in-house? What are the guarantees a service provider can bring to make sure they are delivered on time and in compliance with legislation? This virtual tour into the heart of a client services centers answers these key questions.| 0 comments |