3 Major Trends in Shared Services
The shared service center market continues to evolve, driven by an increasingly global business environment. Here are three of the leading trends in shared services heading into 2011.
1. Global Adoption and Growth
Organizations are increasingly adopting shared services centers in multiple locations around the globe. Latin American centers continue to rise as more US businesses and multinationals establish operations in the region. The lower operational costs of central and eastern Europe have also lead a steady rise in shared service center (SSC) activity there. Furthermore, individual SSC’s are serving wider and more diverse geographies.
According to a recent global shared services survey conducted by Deloitte, the United States and India have the greatest percentage of shared service centers serving four or more continents, followed by the United Kingdom and China.
The majority (60%) of companies surveyed by Deloitte have more than one SSC. This global growth and adoption is driven by the benefits shared services have consistently demonstrated. The most cited positive impacts among respondents of the survey are:
- Process efficiency
- Cost reduction
- Process quality
- Data visibility
- Improved service levels
It is clear that the shared services industry is maturing, and that the shared services business model is growing in popularity and adoption.
2. Public Sector Adoption
Historically the public sector has lagged the private sector in its adoption and successes achieved with shared services. With private businesses, it is not uncommon to find cost savings of over 20%. The same cannot yet be said for the public sector, but this is changing.
The recession has put significant pressure on public organizations to provide better service with a reduced budget. Better services are required in areas such as education, taxation, welfare, and citizen support. This has helped the shared services model become much more widely accepted in the public sector than in the past.
Although public sector adoption has grown, the results achieved still do not approach those in the private sector. This is mainly due to the fact that the private sector has more experience and expertise in this model, which has been implemented for decades. The public sector is by comparison relatively new to shared services and not as mature.
However, the public sector is well positioned to adopt the best practices and strategies from the private sector. As the public sector’s expertise on shared services develops, look for both the penetration of this model and its results achieved in governments and public organizations to grow.
3. Shared Customer Service Centers
Shared services has traditionally been deployed most often for the following business functions:
- Human Resources
- Information Technology
While not as prevalent historically, the numbers and breadth of customer shared service centers is on the rise. The benefits of the shared services model lends itself nicely to pressures on customer support organizations to improve service levels under tighter budgets. The increasing importance of customer service as a differentiator has also resulted in global organizations putting more attention into this business function.
In fact, ‘Increase customer satisfaction’ was the third most cited priority for driving incremental SSC value in the global shared services survey conducted by Deloitte in 2009 titled “Shared services shines in challenging times.” 43% of respondents cited customer satisfaction as a top priority, right after reducing costs and improving processes. As demand for better and more efficient customer service grows, we expect a significant rise in this number in the near and long term.
For further reading on how shared services can positively impact customer support functions, be sure to check out How Business Shared Services Improve The Customer Experience.
Business Shared Services: A Model for Streamlined Support
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