5 challenges when setting up a shared service centre

Posted on: 10/07/2019

Challenges when setting up a shared service centre

Shared service centres (SSC) are becoming part of long-term business strategy and their numbers have increased significantly since the mid-80’s. Most organisations create SSC’s to improve efficiency, deliver cost savings and generally provide a better service for its customers and suppliers, as well as internal users.

But not all of them reap the benefits. Time and time again I hear about shared service centres failing and it’s usually down to one (or more) of the following challenges:

Leadership

Every shared service centre needs a good leader. When going through periods of change, you need a leader that can not only influence the team but customers, suppliers and stakeholders too. A good leader will show resilience and will also be approachable. A leader needs to be strategic, and drive the SSC forward, but also needs to manage it from an operational perspective. Having the wrong leader can leave a team unhappy and disengaged. A good leader will look beyond the SSC and look at the impact this will have on the wider business, as well as the end user.

Engagement

For a shared service centre to be successful, engagement must be a priority. This doesn’t just mean engaging with people who are working within it, but anyone that uses the service. A clear and positive message needs to be delivered about any changes that are taking place and how it may affect them. Managing people’s expectations and thinking about how it will affect them but delivering the message about how the changes are beneficial to THEM. Communication is key! It’s important that the project teams provide progress updates so you can celebrate success and quick wins, but also ensuring how external stakeholders may be impacted. Find out what drives people and how you can make THEM successful.

Technology

Technology is one of the most important factors of a successful SSC. With emerging technologies such as RPA, blockchain, analytics and The Cloud, to name a few. Tech will be one of the biggest investments when setting up a shared service centre. People say if it’s not broken then don’t fix it, but just because it works, it doesn’t mean it’s the most efficient way of doing it. SSCs are utilising technology more than ever. It can reduce headcount, eliminate errors and be more time efficient, but if it’s implemented wrong, or isn’t fit for purpose, it can create more problems than anything. 

Planning & strategy

The planning and strategy behind setting up a shared service centre is the most important part, in my eyes. Will this be a captive SSC, or will some functions be outsourced to a third-party provider? Location is also key, and you will need to ensure that the talent pool is sufficient for your requirements. Processes need to be transitioned; systems need to be integrated but this will have an impact on BAU responsibilities. Once setup, forward planning is crucial too, as you look to expand or consolidate different business units/regions into the SSC.

People

“A business is only as good as its employees.” I’m sure we’ve all heard that before?

People are one of the most important factors of a shared service centre. Without the right talent, SSC’s wouldn’t be able to deliver the service. It’s essential to have subject matter experts who can monitor compliance updates and implement the changes when needed. It’s important to gauge the talent pool in the area in which the SSC is located, as skill shortages can be a huge problem, particularly if it’s a European SSC with language speakers. Believe me European language speakers with specific experience is hard to find!

Although there are many more characteristics to think about, these will give you a strong foundation to have a great shared service centre.

If you would like to discuss further, email me at sam@refind.co.uk.

You can view more about Sam Perry our Shared Services Executive Search expert here.

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