Trends in Shared Services: Unlocking the Full Potential

Research Report

IntroductionAccenture began to study, design and build both captive and outsourced shared services solutions over 20 years ago. We have published several research studies and numerous articles over the years, each illuminating aspects of what has been an interesting (if for some, challenging) journey. Time and again we have seen one indisputable outcome—when done correctly, shared services enables major multi-function transformation for private and public sector organizations in every region of the world.

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Expectations of the shared services model are high, and they should be. For over two decades, shared services organizations have enjoyed the benefits of cost savings, efficiencies and better service that shared services masters have heralded. For the old pros, globalization and multi-service extensions continue to create rich opportunities. But Accenture experience and research finds that many private and public sector organizations that are enjoying the initial benefits have only scratched the surface of what is possible with shared services; they have yet to use shared services to contribute significantly to the enterprise’s overall strategic objectives, such as growth, global expansion and competiveness. After 20 plus years, shared services may be a well-established operating model, but its full potential has yet to be unlocked.

This year, Accenture undertook a research survey and a series of interviews with shared services leaders to delve deeper into the trends most likely to affect our clients’ operations, and to provide some insight into what they will need to focus on to excel in the future. We found plenty of good news. For example, as we have predicted over the last decade, the shared services model increasingly has been applied to higher-order services—those services requiring more skill and/or a need to be closer to the end customer. As a result, the shared services reporting relationship, and the influence that goes with it, has migrated increasingly toward the C-suite. Today, the most progressive shared services leaders are integral to the leadership team of the enterprise they serve.

So what is top of mind for shared services leaders today? Our research points to five topics on the agenda for continued success and sustainability:

Process Excellence: Many shared services organizations continue to struggle with the fundamentals of process excellence; those who excel have put process excellence into the context of overall business optimization, taking apart each process with the critical eye of an engineer and optimizing every step. As part of these efforts, they are making dramatic improvements in efficiency and earning new respect in their organizations.

Service Excellence: Shared services organizations seeking to achieve high performance recognize that, despite continued advances in functionality, a reliance on enabling technologies will only get them so far. They are paying close attention to readying their service management framework (the “system around the system”) to be able to meet the demands associated with assuming a more strategic role.

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the expanse to integrated business services. They are leaving the function-based model of traditional shared services behind, becoming independent, end-to-end service businesses with C-level leadership and strategic importance on par with other operating units. As they move their services up the value chain, they are bringing global flexibility, sourcing agility and continuous innovation.

New Technologies Impacting a Mature Model: Cloud computing and social media are top technologies on the minds of shared services executives, but they are proceeding with caution. Their enthusiasm for potentially new flexible service delivery options, broader access and heightened collaboration is tempered by uncertainty about potential business disruption after they have worked so hard to stabilize their operations.

In the sections that follow, we explore these topics in more detail. We offer practical insights based on our own experience and our conversations with leaders who have laid foundations in these areas and already are emerging ahead of their peers. What we know for sure is that shared services organizations looking to achieve high performance cannot be complacent. To remain relevant, shared services organizations must continue to evolve by improving and expanding their influence on the overall enterprise agenda.

Continuous Improvement and Value Marketing: Shared services organizations that have achieved high performance are not content with their established processes and service framework. No matter how well they operate, they continue to look for ways to improve—both in services they currently provide and in new services they would like to offer. Moreover, they recognize that marketing the value they bring to their key stakeholders is critical to building the trust that leads to new business opportunities for their organizations.

Integrated Business Services: As shared services continues to mature, we find that those looking for new levels of business value are boldly crossing

Our Methodology Accenture engaged an independent market research company to conduct telephone surveys with over 100 individuals in 16 countries during April 2011. Over 50 percent of the organi-zations had annual revenues greater than US$5 billion. In addition, 50 percent of the entities have had shared services organizations operational for three to five years. Although the titles varied, all respondents had charge of the management of shared services in

their organization. In addition, Accenture personally conducted a series of in-depth interviews from June to July 2011 with a select group of shared services leaders. The result from these two exercises is the foundation for this research report. All individual and organization names have been kept anonymous to guarantee confidentiality of the responses.

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Process Excellence: Taking the Work Out of the Work

study Achieving High Performance through Shared Services: Lessons from the Masters1, we found that a vast number of shared services organi-zations had fallen short of realizing their original business case benefits of standardized policies, processes and supporting systems. The intentions may have been there, but without a specific discipline within the shared services organization that focused on continued process excellence, non-standard policies, processes and systems started to creep back in.

Our research highlights the need for renewed attention to driving process excellence. Many organizations now realize that before they can explore a next-generation strategy, such as integrated business services, they may have to go back to their foundations—and evaluate the functional and/or regional processes within their existing shared services organizations. In Accenture’s 2009

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This year, we continued to find that levels of standardization vary widely and for the most part, there is still vast room for improvement. For example, only 49 percent report having stand-ardization across policies, processes and supporting systems (see Figure 1).

It seems likely that at least some of the struggle for standardization stems from a variability in process ownership. For example, although more than three-quarters (78 percent) of our survey respondents reported that they now define processes at a global level, 48 percent of them still implement processes locally. Likewise, less than half (42 percent) of all respondents

report housing process ownership at a global level (see Figure 2). Without buy-in to global process ownership, organizations still risk having multiple process owners making changes independently. This situation will continue to make genuine standardization a challenge and have real implications for shared services organizations as they look to position themselves to assume a more strategic role in the business.

Those who struggle with this fundamental aspect of achieving high performance in shared services should be interested to learn how a master develops the necessary level of process discipline. We interviewed a shared services leader in the consumer products industry whose operation employs 1,000 people and has a track record of success that includes a 60 percent cost reduction over the last 10 years. The leader is an engineer with manufacturing floor experience, and

Figure 1. Only 49% of respondents report having standardization across policies, processes and supporting systems.

Which of the following best describe the level of standardization in your shared services?

49%

26%

25%

Policies, processes and supporting systems are standardized

Policies are standardized but no processes and supporting systems

Policies and processes are standardized but no supporting systems

he brings a level of process excellence discipline to finance, human resources and other support services that would make a Lean Six Sigma Black Belt proud. He explained his organization’s approach this way:

“We view each process from the perspective of an industrial engineer. Our organization scrutinizes every process, with a focus on managing and eventually eliminating exceptions. The goal is to break every process into discrete pieces that optimize individual skill sets. This takes out the complexity and removes the need for jack-of-all-trade types that can’t excel at the same level for every activity. Also, it gives us the scale benefit that shared services was designed to deliver, but too often has underachieved.”

The leader’s organization also uses technology to “take the work out of the work,” and employs specialists and metrics to achieve higher efficiency and higher associate morale. While other elements of success certainly are in place—including C-level support, comprehensive change management and a relentless focus on value—it is the organization’s continued focus on process excellence that stands out.

This continued focus on process excellence does not mean that the front-office customer service mentality is sidelined or that linkages and hand-offs to the core operating units are ignored. In fact, quite the opposite. Understanding all clients (both internal and external) and why they call for service can uncover root operational

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Figure 2. The trend toward global process management and ownership is gaining momentum slowly.

issues with serious impact on the bottom line. As one leader describes, “Higher productivity (efficiency) is a byproduct of excellent service—not the other way around.”

In fact, having a service-oriented mindset, where the shared services organization has a culture of wanting to make things better for its clients, can lead to improvements that stretch far beyond what many would consider a typical shared services mandate. This significant value-add essentially translates into a substantial increase in customer service.

For example, the leader of a shared services organization that had achieved high performance described the

significant role his shared services organization played in uncovering and solving serious issues with pricing data management:

“The data existed in multiple business unit and customer systems. It was inconsistent and there was no visibility into what was right or wrong. This was costing the company. Then shared services took over the process and exposed all the hidden issues; they corrected inaccuracies, reduced exceptions and had a positive impact on revenue. Shared services brought focus and discipline to an area that did not have strong governance and ownership. The value we have contributed has been exceptional through the same proven model of segmentation, measurement, root cause analysis and process clarity.”

An approach such as this one, which puts shared services process excellence into the context of overall business optimization, builds trust with

the customer. For shared services organizations that have already become high performance businesses, it also means they will be asked to take on more and more, executing these new processes using the same segmentation and optimization techniques they have honed while delivering first-generation services.

How does your organization manage processes and services globally?

How would you describe process ownership?

Global process owners

Processes are defined and implemented globally

Processes are defined and implemented regionally

Processes are defined globally but implemented regionally (can be customized at the regional level)

Regional process owners

Local process owners

No standard centralized process ownership

42%

47%

8%3%

30%

48%

22%

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Service Excellence: Building the System Around the System

Still, the progressive leaders in our survey have said that relying on enterprise resource planning and enabling technology only delivers part of the solution. Even industry-leading technology will not prevent a shared services organization from failing to meet expectations. There needs to be a “system around the system” that includes the people, discipline in procedures, communications, service expectations, performance measurement and key cross-functional processes, such as continuous improvement and client relationship management. It’s this broader shared services system around the system—which Accenture calls the service management framework—that sets shared services organizations that have achieved high performance apart from those with a sub-optimized centralized service delivery model.

The service management framework is the keystone, ensuring that shared services delivers as promised and achieves the benefits so often articulated in our interviews—exceptional service, consistent delivery, managed risk, and operating unit trust and partnership. As one shared services leader described, “The service management framework is never fully appreciated until it is not there or it is not working correctly. Then the downside of lacking this structure becomes very clear as shared services gets a bad reputation.”

Our research shows that many shared services organizations still have room to grow in developing all the elements of a robust service management framework; for example, while 76 percent of all respondents

report having a service catalog with formal sign off, only 32 percent have both formal sign off and two-way responsibilities (of both the shared services organization and the operating unit) clearly defined (see Figure 4).

Interestingly, our research also shows some marked geographical differences in service excellence. While 83 percent of the respondents from the Asia-Pacific region and 75 percent of the respondents from North America responded that they measure and report service levels to clients, in Europe and Latin American countries, only 55 percent say they report service levels to clients. This point is key, as a successful service management framework is defined by collaboration: it recognizes the criticality of transparency, joint responsibility and ownership for business outcomes.

The stakes are high for getting the service management framework right, as it is a foundational element of shared services mastery. Laying this groundwork, and gaining experience and comfort with it throughout the organization before evolving to integrated business services, dramatically increases the likelihood of successfully moving up the value chain. Without it, operational challenges will be magnified as the scope and scale of the organization expands.

For example, one shared services leader described how his large-scale shared services organization has had a history of taking on too many client requests while lacking the right tools and

As modern enterprise resource planning and enabling systems become more robust, the temptation to turn to technology to answer the demands for progress will be great. Yet our research shows that leaders already recognize an over-reliance on technology solutions will only take them so far.

Certainly, the standardization that is so central to achieving high performance in shared services will increasingly be built right into the technology used by shared services organizations. We found considerable evidence of this trend in our research; for example, 92 percent of respondents stated that they have already implemented call scripts, and one-third (33 percent) claim to have automated all call scripts (see Figure 3). The advances we see today—such as data governance applications that are tailored for centralized maintenance, for example—strengthen the already-strong business case for technology that has demonstrated reductions in labor cost through automation. As one executive at a high-tech company described the benefits of increased standardization through technology, “The customer service experience has been improved, cash flow has been improved, and all processes that touch and use master data are running more smoothly and at a lower cost due to the elimination of exceptions and the related manual resolutions.”

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Figure 3. Technology advances will allow for increasing levels of standardization to be built into critical shared services processes.

Figure 4. Shared services organizations still have room to grow in developing all the elements of a robust service management framework.

the ability to manage resources appropriately. His shared services organization is now undergoing a major reset for new services—dialing back to the role of “boutique provider that serves a small number of clients while working to get major issues related to standardization, expectation management and recognition of the value provided resolved before expanding service delivery to a larger scale.” A key element of the reset will be “clearly defining the relationship and obligations between the parties to deliver an agreed outcome.”

Another shared services leader described how her shared services organization has excelled at instituting standardization and has built considerable leverage and scale as a result. Now, however, her organization’s strategy has shifted its focus from pure standardization efforts to becoming more service-oriented and adding a higher level of value. She said, “Once we demonstrated that we were able to handle the basics, then we could talk about how we could add value. As an example, our Global Service Desk is evolving from ‘What’s your ticket number?’ to ‘How can I assist you with your issue?’ In order for that evolution to occur, we need to rewrite scripts and processes, and the technology also needs to catch up from where we were to where we’re going.”

The challenge for this shared services organization now is to enable some flexibility within its business model without jeopardizing the benefits that it has achieved through its standardization efforts. The overall organization is now going through a transformation that relies on a service management framework to help set expectations with its clients. The changes to its IT systems, processes and people won’t happen overnight. But the final result should transform the shared services organization from merely a service provider to a proactive business partner.

Are call scripts used to manage consistency and quality?

All call scripts are automated within the call management software

92% of organizations have call scripts

Only complex call scripts are automated within the call management software

Written call scripts are available but no automated scripts available in the call management software

No call scripts available

33%

39%

20%

8%

Do you have a catalog of services to manage expectations regarding scope, mutual responsibilities and demand?

32%

44%

15%

9%

Inventory of services that is formally signed off as well as joint responsibilities (two ways) defined

76% have an inventory of services that is formally signed off

Inventory of services that is formally signed off

Inventory of services that is not formally signed off

No catalog of services, but service level agreements exist

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Continuous Improvement and Value Marketing: Raising the Bar Internally and Externally

Continuous Improvement When we think about the evolution of any shared services organization—regardless of maturity, expansion into innovative services or commitment to integrated business services—it will never look the same as it does today. The general value proposition of the shared services model in the here-and-now is easy to understand, but it will be continuous improvement that drives the model’s ability to progress and evolve. As one shared services leader expressed, “The key to maintaining momentum after implementation is continuous improvement and a

performance management-oriented mindset. Any new initiative must be undertaken with a strong quality focus, backed by higher return on investment and an improvement in customer satisfaction.”

Leading shared services organizations recognize that their ability to continually improve is inextricability linked to their perceived value and, ultimately, their viability. Perhaps it is not surprising, then, that so many are investing so much in continuous improvement—and then publicizing their successes, loudly and clearly.

In our research, 42 percent of all respondents reported spending 10 percent or more of their annual operating budget on continuous improvement initiatives (see Figure 5).

They take a range of approaches. Some shared services organizations have continuous improvement teams that focus on the next-generation projects, while others have a cadre of specialists who drive incremental improvement every day. Approximately one in four (23 percent) have established a formalized, Lean/Six Sigma/Kaizen approach that draws on established

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Figure 5. Shared services organizations are making considerable investments in continuous improvement initiatives.

practices, such as instituting end-to-end process metrics so as not to optimize within a silo, and visual management, which provides readily visible metrics to clarify each day’s goals and give timely feedback on performance.

Where do they get their continuous improvement ideas? Our study shows that ideas are generated fairly equally from clients, employees, internal management and outside experts. And each source has different incentives to advance the agenda of the shared services organization and the performance of the enterprise being served—from mandates, to internal recognition, to monetary reward.

Value Marketing We talked to a number of leaders who treat continuous improvement as a formal process with the same level of significance as a client-facing business service domain. They are easily funding the continuous improvement investments they make with the value they bring every day. As one leader explained, “We have worked hard to demonstrate a deep understanding of the business strategy first, and then to demonstrate shared services’ ability to support it. As a result, our credibility and reputation has increased over time and it has become much easier—to the point where we are being asked to take on more now, versus having to go chase business in the past.”

Not all shared services organizations are so fortunate. Given shared services’ success over the past 20 years, the obvious progression would seem to be toward higher-order service expansion. However, our research shows that for many organizations, the traditional transaction-heavy functions continue to dominate the shared services landscape. As shown in Figure 6, we found that the top services provided continue to be in IT (75 percent) and finance (58 percent).

Figure 6. Traditional transactional functions still dominate shared services provision.

What percentage of your annual operating budget is dedicated to continuous improvement?

8%

34%

43%

15%

Greater than 15%

42% of organizations will dedicate 10% and more of their operating budget to continuous improvement

58% of organizations will dedicate between 0% and 10% of their operating budget to continuous improvement

10 to 15%

5 to 10%

Less than 5%

What typical services are being delivered through shared services today? (multiple mentions)

IT (i.e., application management)

Finance

Client facing services (i.e., billing, collections)

HR

Procurement

Logistics/materials management (i.e., procurement, inventory management)

75%

58%

51%

50%

41%

39%

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communications program focused on marketing the value delivered, this shared services leader has established credibility among his clients. His clients see his organization in a new light and that has enabled his organization to cross the threshold from traditional to value-add services, such as M&A analysis and data analytics. His success illustrates the power of self-promotion for shared services organizations ready to step out of the shadows and into the strategic prominence of integrated business services.

Many organizations clearly would like to be doing more; as Figure 7 shows, within five years, nearly half of all respondents envision their organizations delivering value-add and/or atypical services (49 percent and 48 percent respectively).

So why haven’t shared services organizations been able to provide more value-add or atypical services to date? At the heart of the issue may be a traditional resistance to change among executives at the operating units served. In our interviews with shared services leaders we frequently heard that, although their shared services organizations had demonstrated process excellence and delivered lower costs every year, they continued to have to fight the perception that the shared services organizations were merely “transaction factories.”

It can almost seem a constraint caused by their success; some shared services organizations have proven themselves so excellent at what they do, that they have been “typecast” into the transaction role. To avoid this stereotype, shared services organizations must look for ways to constantly evolve–and more importantly, be able to tell their evolution story effectively. Our research uncovered a number of progressive shared services organiza-tions that are succeeding quite well at marketing the value they bring.

For example, we spoke to one experienced practitioner in the travel industry who has embraced “value marketing” as one of the key tools that will enable his shared services organization to provide higher-order services as it continues its journey to integrated business services. He found that the regular client communications that showed how well his organization was performing against service level agreements had become usual and expected—with little impact on perception. When he thought

about what his organization had accomplished over a decade of service delivery evolution (including a track record of not writing off a single accounting discrepancy in 10 years and clear year-over-year cost reductions through execution excellence), he sought to elevate these successes to the level of attention they deserved.

The leader undertook a program of value marketing: proclaiming all the extra value that his organization has provided in a quarterly client newsletter. For example, his organization found that some online travel brokers who charge in advance were keeping the money when a traveler canceled their plans. Through centralized processes and systems, plus a proven ability to analyze complex issues, his shared services organization had the ability to recover that revenue. In the past, such a value-add service would never have been given proper credit. Now however, with his progressive

Figure 7. Nearly half of all respondents expect to be providing value-add and/or atypical services within five years.

Please indicate what type of services you plan to provide in five years: (multiple mentions)

76%

49% 48%

Typical services (e.g., finance, HR, procurement)

Value-add services (e.g., data analytics, research)

Atypical services (e.g., communications, treasury, legal)

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Integrated Business Services

The emergence of integrated business services is bringing a long-envisioned “hub-and-spoke model” to genuine fruition. In integrated business services, the global or enterprise-wide hub(s) performs routine activities in a standardized manner in very few cost competitive locations. Then the regional business services centers (the spokes) leverage existing regional shared services organizations and talent to move up the value chain, taking on higher-order services that require more specialized skills (which, in turn, opens up new opportunities for employees to move up the career

Integrated business services—the logical extension of the proven and pragmatic shared services transformations that began over 20 years ago—appears finally to have arrived on the scene. Integrated business services are independent service businesses that leverage the global geographic footprint of the organization (and any of its outsourcing partners) to deliver consistent, high-quality services at a competitive cost while maintaining proximity to the customer where required.

Operating units and government agencies have already shown they can do more together than they can apart for individual functions; with integrated business services they are now applying that same logic across functions to begin providing one-stop service for entire processes. Integrated business services’ simplified, one-stop-service-based nature dramatically enhances service because it allows customers to resolve business issues without having to navigate the organizational complexities of a traditional multi-function shared services model.

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ladder as well). Finally, locally deployed business service professionals provide and maintain customer and market intimacy.

Integrated business services organizations’ broad responsibility for end-to-end business services gives them a new vantage point, which enables them to bring whole new levels of strategic value to the organization. For example, pioneering integrated business services organizations in consumer goods and services companies are now providing support for their enterprise sales and marketing organizations through trade promotion management, consumer contact, digital marketing and merchandising initiatives, and consumer and merchandise analytics. Similarly, each industry will have its own specific value-add opportunities, such as records management in health and public service, fraud prevention and monitoring in financial services, or load forecasting and analysis in electric and gas utilities.

With integrated business services, customers consume services in a more straightforward way than the collection of functional activities shared services historically has provided. As a result, the integrated business services organization typically develops a new understanding and cohesion with their operating unit customers. Progressive shared services leaders have their sights set on such an outcome. As one executive explained, “The integrated business services framework is universal. It provides a ‘true north’ that crosses continents. It is proven to work and there is no reason that it can’t be implemented globally.”

Certainly, our survey respondents seem intent on trying: 90 percent reported that they had added additional geographies/markets to the scope of their shared services, typically within the first three years of starting operations. Because integrated business services organizations take on a more strategic position in the enterprise-wide operating model than traditional shared services, it also makes sense that as shared services migrate toward integrated business services, reporting relationships should elevate to higher-level executives than ever before. Our research reveals the trend happening. As shown in Figure 8, shared services organizations are less likely now to report to a functional leader (41 percent) than they are to C-level leadership (59 percent). As a point of reference, in 2009, when we released our Achieving High Performance through Shared Services: Lessons from the Masters

report, 8 percent of the shared services organizations that participated in our research reported to a CEO. Today, that number is 17 percent.

The elevation of leadership role is encouraging; however, effectively moving to integrated business services also demands a level of standardization that stems from a shift to end-to-end process ownership and governance at a more global level. As described in the earlier process excellence section, this move has been somewhat slow in coming. Our research indicates that while shared services organizations clearly desire (and are beginning to structure themselves to pursue) the benefits of integrated business services, many still find it a challenge to achieve the benefits in a predictable and efficient way. In fact, Accenture experience has been that few

Figure 8. Shared services organizations are more often reporting to organizational levels higher than functional leaders.

To whom does the shared services organization report?

CEO

President

COO, VP of Operations

Functional leader (CFO, CIO,CHRO, etc.)

59%

17%

16%

26%

41%

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organizations actually enjoy a true integrated business services capability. If, as we expect, integrated business services increasingly becomes the norm for shared services, the necessary changes to global process definition, implementation and ownership will have to follow suit.

Accenture’s experience also leads us to conclude that as integrated business services matures, those who are successful will benefit not only from global scale, leveraging of cost-effective locations and effective use of resources (both people and technology), but will also have a structure to effectively manage outsourcing arrangements around the world. As service organizations take on increasingly

Figure 9. The decision to outsource usually is made within three to four years of starting up a shared services organization.

If you have outsourced services, at what point did you make this decision?

At start-up

One to two years after start-up

Three to four years after start-up

9%

25%

69%35%

12%

8%

5%6%

Five to six years after start-up

Six to 10 years after start-up

Greater than 10 years after start-up

No outsourcing used

complex activities, local and regional service delivery will become a requirement. At the same time, the availability of highly qualified talent in low-cost locations will make it increasingly attractive to maximize the use of outsourcing providers.

Some of these arrangements will likely get creative. According to a recent news brief in Bloomberg Businessweek2, a growing trend toward “homesourcing” (a combination of outsourcing and telecommuting) is set to explode. Our research found that 80 percent of respondents already propose flexible work arrangements—mainly working from home. By enabling homesourcing, previously untapped highly skilled labor pools may suddenly become viable staffing options for shared services organizations focusing on innovative and value-add services.

Such flexible options may solve some of the difficulties associated with obtaining local language skills, and

of dealing with fluctuations in wage arbitrage. Shared services is shared services, no matter who is getting paid to operate a given function or service in a given geography. From the client’s perspective, all that should matter is that their service expectations are satisfied. As the need to tap into new locations becomes apparent because of these issues, shared services organizations could potentially “set up shop” quickly by using a homesourced (either captive or outsourced) workforce and circumventing the traditional brick-and-mortar infrastructure.

Our study does show outsourcing gaining ground and being leveraged in many geographies where it makes economic sense. Shared services organizations that take this route seem to come to it rather quickly; our research shows typically within the three to four years after a shared services program start-up (see Figure 9).

Managing these multiple sourcing arrangements consistently is a challenge for most organizations. Again, regardless of the entity providing the service—including third-party providers—the global process owners must manage the entirety of the end-to-end process. Organizations that are successfully using integrated business services to drive high performance already have experience managing globally and can help by applying the same level of discipline consistently across all service delivery partners. Their ability to maintain this level of service delivery rigor will become increasingly important to their clients as the drive for global optimization of low-cost locations continues.

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Social Media Social media also has the attention of the shared services leaders we surveyed. Ninety percent of all survey respondents expect social media to have an impact on their business in the future (see Figure 10). Despite the explosive importance of social media, however, many shared services leaders are taking a “wait-and-see” approach. Many fear employees will overuse social media for personal reasons, resulting in a loss of focus and productivity. They know they need a point of view and an approach going forward, but they are still observing and learning. As one executive stated, “We’re still wrestling with where it is appropriate and helpful.”

Although our interviewees mentioned increased collaboration (both internally among shared services organization employees and externally, with clients) as a potential benefit, they are still uncertain exactly what positive business impact social media will have on a shared services organization.

Accenture believes social media can constructively impact the shared services organization from knowledge management to customer service and other business areas in between.

New Technologies Impacting a Mature Business Model

Cloud Computing As shared services leaders look to the future, new technologies are clearly on their mind. When asked about the advances they expect to have the largest impact on the future of their shared services organizations, cloud computing technology rises to the top (42 percent).

The interest likely comes down to some old familiar themes—access, cost and scalability. Cloud computing technologies easily provide anytime/anywhere access to applications, platforms and infrastructure. Shared services can leverage this accessibility via multiple sourcing options from offshore to near shore to any shore. As clients continue to grow in their needs for services, cloud computing provides a platform for shared services to scale to business needs quickly, yet still manage its risk mitigation responsibilities in a cost-effective, virtual manner.

If objectives are clearly defined and correctly implemented, it can improve collaborative engagement within shared services organizations, resulting in the ability to draw upon the entire organization for continuous improvement while giving employees a sense of ownership and satisfaction. It will allow the shared services organization to leverage its collective knowledge in providing up-to-the-minute best thinking, acting as a growing virtual encyclopedia and an invaluable tool for knowledge management.

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Figure 11. Shared services organizations currently approach knowledge management in a myriad of ways.

How would you best describe your approach to knowledge management? (single answer)

Common collaboration tools used to manage knowledge assets 36%

32%

16%

14%

2%

Formal process with dedicated knowledge manager but no tools available to manage knowledge assets

Loosely defined process and toolset

Function-specific tools used to manage knowledge assets

No knowledge management capabilities

Figure 10. Shared services leaders almost unanimously agree that social media will have an impact on their business, although they are less certain of how.

What impact do you believe social media will have on your workforce? (multiple mentions)

Increase internal collaboration and improve productivity

Expect an impact from social media

Do not expect an impact from social media

Increase collaboration with clients and service excellence

Increase shared services employee job satisfaction

57%90%

10%

56%

43%

Currently, knowledge management approaches vary widely among shared services organizations (see Figure 11). Using social media tools may allow shared services organizations with a weakness in this area to exploit an approach that already has a high degree of familiarity and ease of use for the employee. By encouraging the use of social media in this way, the shared services organization can continue to foster a common, shared culture within the shared services organization, regardless of employee location.

Accenture believes social media will also alter shared services organizations’ relationships with their clients (both internally and externally) in very positive ways. A key example is the customer service area. Per our 2010 thought leadership piece The Evolution of Customer Service: Harnessing the Potential of Social Media, “Social media can help companies improve customer issue resolution and reduce cost while building loyalty and advocacy among its most knowledgeable customers. To tap the enormous potential of social media for improving the customer service experience, companies need a clear strategy and long-term plan for using social media channels in ways that create value while avoiding inadvertently doing harm to their reputation. Indeed, while integrating social media into customer service does involve some risk, not using this increasingly popular channel is risky as well."3

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The Future of Shared Services: What Will the Next Decade Bring?

Regional nodes will be smaller than we have seen traditionally, closer to their customers and more skill-based. They will accommodate time zones, languages and regulations, while working seamlessly with hubs providing routine and procedure-driven activities (which can now be located anywhere, thanks to technology and “the cloud”). For some, this future view is already a reality in the making, with shared services becoming a platform for new heights of organizational performance.

One shared services leader we interviewed expressed that he was still seeking the “lights-out” model that was promised over a decade ago, where everything is so automated and exception-free, that the traditional shared services organization becomes much less prominent. We do not envision such a “lights-out” future for shared services—at least not any time soon. For while we have seen that shared services staffing has shrunk significantly over the last 10 years for traditional transaction processes, our study this year also shows that there is a new generation of atypical and value-add services that will increasingly be delivered, with the same proven discipline. Once the service management framework, or the “system around the system,” is working smoothly, we believe shared services operators will be confident in delivering a host of different types of business services.

Shared services has come a long way since it first broke ground, and we believe changes of similar scale are on the horizon. The future shared services model will look very different than it does today. For example, in line with the growing prominence of the hub-and-spoke model of integrated business services, we may see more rather than fewer shared services nodes in the network. Shared services may even become ubiquitous as organizations begin to see that those who expand shared services’ scope and strategic value through integrated business services leapfrog ahead of their competition.

The shared services model has staying power. We already see many shared services leaders making very interesting incremental investments to apply the shared services model to more innovative and value-add services. And we believe these services will have become, in fact, much more commonplace by the time we conduct our next shared services study.

We will watch the future unfold with interest, for we are confident that as the shared services model continues to evolve, it will continue to deliver value beyond expectations for those with the vision to see beyond the business case. And we believe that—as it has always been since shared services’ inception—the gap between what is and what can be will continue to be bridged by the innovative spirit of pioneering shared services leaders.

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Notes

1 http://www.accenture.com/us-en/ Pages/insight-achieving-high-perfor mance-through-shared-services- summary.aspx

2 http://www.businessweek.com/tech nology/homesourcing.htm

3 http://www.accenture.com/us-en/ Pages/insight-harnessing-potential- social-media-summary.aspx

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