Shared Services vs. BPO – who will survive?

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Shared Services vs. BPO: There has long been an argument between Shared Services and Business Process Outsourcing (BPO) – is one better than the other? There are many factors to take into account including the business objectives, the budget available and the speed that is required for the project.

BPO is the process of engaging a third-party vendor with the right skills and resources, to carry out work on your behalf.

Shared Services relates to the creation of an autonomous business unit, based on-site, which carries out these processes for multiple functions within an organisation (HR, Finance, procurement).

The services that BPO and Shared Services provide is generally to remove manual, operational and often repetitive tasks from your everyday work.

 

Shared Services vs. BPO: Business Process Outsourcing

 

BPO is often thought to be more efficient, due to it having better systems and processes. It is frequently based offshore, so labour costs and overheads can be significantly lower than having this service in-house.

Outsourcing can often be implemented quickly and more effectively, due to the experience of the resource within these companies. The transition to an outsourced model may not offset the savings you make and the increase in the quality of the work you receive.

Feedback is often that ‘BPO can be seen as ‘faceless’ or lacking the human approach’ that people sometimes want from these services and in a world where employee engagement and experience is paramount, this can cause real issues.

Shared Services vs. BPO: Shared Services

 

Shared services can be a better solution if your needs are bespoke. BPO can often be one size fits all, and if you have requirements that are specific and processes that aren’t bog standard, then a shared services model may be the best choice.

However, the implementation of a shared services function within a business can be slow and painful. More often than not this is due to lack of experience internally to deliver this and if systems, processes and data are not clean and efficient, the service will fail.

If the service fails, it can be hugely damaging to employee engagement and if people aren’t engaged to use the service, then they will revert to old habits, rendering the service useless.

Is there a place for both when considering Shared Services vs. BPO? 

 

General consensus seems to be that in the long term, only one will survive. I think there is a place for both: if you have a high volume of standard processes which need carrying out without the knowledge of internal factors or processes, then BPO is probably for you. However, if you have unique processes and you have the time, money and resources to do this properly, then shared services is the best option.

Before you decide whether to implement a BPO or Shared Services model, it’s a good idea to do a thorough diagnostic of your business and ask yourself the following questions:

  • What is the end goal is for your organisation in changing to a new service delivery model?
  • Do you have management engagement and support?
  • Are your systems, processes and data fit for purpose?

Once you have the answers to all of these questions, you should be able to make an informed decision.

 

OUR FOCUS ON LONG-TERM PARTNERSHIPS

At re:find we believe that recruitment is not a one-off transaction but rather a long-term partnership. We aim to build long-term relationships with our clients, providing ongoing support and advice to help them find and retain the best talent for their organisation.

We understand that every organisation is unique and that there is no one-size-fits-all solution when it comes to recruitment. That’s why we offer bespoke recruitment solutions that are tailored to meet the specific needs of each client. Whether you need help with a single hire or a full recruitment campaign, we can help.

We are committed to providing our clients with the highest quality service. We take the time to understand your organization’s culture and values, as well as the specific skills and experience needed for each role.

For more information on our guide to our Shared Services executive search please get in contact with our Managing Director, James Cumming.

 

 

Your first 30, 60 and 90 days in a shared service leadership role

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Starting a new role in shared services can be a little overwhelming. Imagine starting a new position managing a team in excess of 30, 50 or 100 people, with new systems and new processes, in a completely new environment.

Where would you start? Most of your first 30 days is a learning curve, and a chance to absorb as much info as possible. Break it down into smaller chunks…

30 Days

  • Introduce yourself:

First impressions count. It is important that you understand your team, and they understand you. What are their frustrations, what makes them tick, and what motivates them to go that extra mile? It is important to understand the dynamics of the team initially and they understand your reasons for being hired. Most managers within a shared service are appointed to make change and drive efficiencies within their function. The whole team need to understand the journey you’re on as they will be a fountain of knowledge to help you reach it.

  • Define your role:

Why have you been appointed? Most roles within shared service have a purpose, and you need to define your existence in the role and what you are there to achieve. The team need to understand your motivations too, so you need to be transparent around this and what you are trying to achieve. This way the team will understand why changes are being made.

What is the business strategy? What are the business’ long term goals? Is it to reduce costs, headcount, make processes more efficient or to grow the team to manage an acquisition? Whatever it is, your team in most cases need to be aware of it, to understand your vison and to help you achieve the journey that you’re on. Understanding the product or service of the business is key, as you will need to think outside the box and consider any challenges that the business may face, and how that will impact the wider shared service.

  • Evaluate your own performance:

Monitoring your performance over a 30, 60, and 90-day period is important. Set yourself achievable objectives, short and long term based on what you have set out with your line manager. Once you’ve set yourself these objectives, it is important not just to deliver them but to go above an beyond.

  • Plan…plan…plan….

60 Days

  • What were your observations in the first 30 days?

Start by looking back on your first 30 days. What have you achieved, what objectives did you meet/not meet and how realistic were they?

Did you identify any risks, skills shortages or areas for improvement? This is the perfect time to reflect on your observations and speak up.

  • Implementing new strategies/processes

What needs to be changed? Is it people, process or systems? This is where you will need to consider the changes you want to drive, and again what impact this may have on the wider business. Most importantly, your team, key stakeholders, and wider business should all be ‘bought in’ to the change agenda and just as importantly your customers and suppliers should be too, if the changes could potentially affect them.

  • Start building your own personal brand

It’s important to start building your own personal brand and be recognised for doing things well. You want to use this next 30 days to really step up and show people why you were hired, and what you do well. By now you should have established relationships within the business and have started to help develop your team and potentially upskill them in in certain areas. By now you should understand your key stakeholders too, and how much influence is needed.

  • Get some feedback

It is important now that you obtain regular feedback to ensure your vision aligns with your line managers. Talk around your observations, and future planning, and some of the key points you’re considering changing.

  • Plan, plan, plan…..

90 Days

  • Create an internal comms plan

Align your plan with the business, and create your own strategy and objectives to share with your team and stakeholders, so they have a clear understanding of the journey you’re on. 

  • Present your gatherings

After spending 60 days analysing and absorbing info, it’s now time to present your findings. Show your stakeholders your problems and create solutions of how to make improvements and how you will measure success.

Now it’s time to really get your sleeves rolled up and start making the changes!

Making a good first impression is important when you’re starting any management role, and by now your confidence should have grown and you will have made an impact on the team in some shape or form. Planning your first 30,90 and 60 days is important if you want to achieve your goals.

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.

Why won’t top performing shared service professions join your business? And what to do about it. Download our free eBook here.

What makes a good shared service leader?

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A good shared service leader

Shared services is a continuously evolving function, and with emerging technologies and ever-changing job titles, it’s important that you set yourself apart from the crowd if you want to become a well-known leader within the industry.

Traditionally, shared service leaders were always judged on their hard skills. Shared services are set up to reduce costs, make processes more efficient and deliver results. However, not all shared service functions have an internal focus, and some are more focussed on delivering a better quality of service their customers, stakeholders and wider business.

So, what skills do you need to be a successful  shared services leader?

Leaderships Skills

Well this one is pretty obvious, really. Leadership skills is one of the most important things you need to have. You need to be the ‘anchor’ for the team and show resilience when going through periods of change. 

Ability to influence

In order to be a successful shared service leader, you will need to have the ability to influence. You will need to influence customers, stakeholders, suppliers as well as your wider team and perhaps the board. You will need to get their buy-in whilst delivering transformation through periods of change.

Commercial mindset

The best leaders within shared service functions will have a commercial mindset and will be more operational than transactional. It’s all about looking at the wider business and understanding how decisions can impact other operations and sometimes the end user.

Tech Savvy

With the rise of robotics, AI and cloud-based systems, it’s important that you can keep up to speed with the latest technologies. With mundane processing tasks being eliminated, this is a great chance to take away some of the tasks the team may call ‘painful’, allowing you to upskill them and utilise them more, which leads nicely to my next point…

Talent attraction and retention

You’re only as good as your team. Building a team with exceptional talent can be difficult. Retaining the team is even harder. In such a candidate driven market it’s important keep your team motivated and challenged as they will no doubt explore opportunities externally. Rotational training, incentive, and continuous development is what most staff want – ensure you get the best team and keep them – enabling you to do the best job possible!

Purpose-driven

Whilst there are some nice shiny job titles and sexy remuneration packages the best share service leaders, in my opinion, are the ones that are passionate about delivering change effectively. It’s all about wanting to add value and pushing to deliver results for the business.

What can I do to develop my skills?

  • Complete online courses/webinars to develop specific skills.
  • Speak at conferences and events.
  • Become a mentor.
  • Attend networking events.
  • Get involved in all aspects of the company and suggest improvements.

What skills do you feel make a good shared services leader? If you would like to discuss further, you can email me at sam@refind.co.uk.

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

Why won’t top performing shared service professions join your business? And what to do about it. Download our free eBook here.  

How you’ll benefit from a shared service function

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Benefit from a shared service function

Shared Service Centres have been around since the mid 80’s, and more and more frequently, large corporates are moving towards outsourcing and the shared service model.

Typically, a shared service organisation is a central hub, and is responsible for handling specific operational tasks. Finance tends the be the most popular function within a shared service, with HR following just behind.

Companies usually implement the shared service model for a number of reasons:

Cost reduction:

When back office functions are consolidated and the work is migrated into one department, this will inevitably reduce cost of transaction processing. In addition to labour savings, shared services contribute to reductions in infrastructure costs such as technology, facilities and services, and administrative overhead costs.

Making processes more efficient:

Replacing dispersed IT infrastructure with the latest technology can eliminate processing time. When standardisation and continuous improvement of processes and systems is being carried out, this leads to a reduction in processing time, less errors and an improved quality of service. This way, your teams time can be freed up so they can focus their time and efforts on more strategic and more ‘human’ tasks.

Improving the customer journey:

Not all organisations create a shared service model to reduce costs. Sometimes the strategy behind a centralised model is to improve the customer journey or service levels of an organisation. The most successful shared service centres, in my opinion, are the ones that focus on adding value as a centre of expertise. When metrics are implemented to a SSC (KPI’s/SLA’s) they help drive performance and service levels.

Upskilling existing staff:


With the rise of technology and automation within shared service functions, staff are being utilised in many other ways. Not only does it make staff more productive, it also improves their skillset and gives them a more rounded knowledge of a business, enabling them to really add value.

When you have motivated teams that have a clear message on what they are trying to deliver, then efficiency, cost reduction and economies of scale are usually improved naturally. It’s about the leadership team creating a clear message and vision on what you’re trying to achieve.

For more info on the role leadership plays within shared services then please see my blog here.

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.

Why won’t top performing shared service professions join your business? And what to do about it. Download our free eBook here.  

Why HR Shared Service Centres fail

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HR Shared Services

HR Shared Services are set up to streamline HR activities, which reduces costs, increases the efficiency of business processes and frees up time to concentrate on strategy.

HR Shared Services functions can add a lot of value if you do it right. If you get it wrong, it can have a negative effect on employee experience and relationships throughout the business with HR can be damaged.

Technology plays a big part in making HR Shared Services effective, but the exact structure and scope of HRSS really depends on the company and various other factors.

Why does HR Shared Services go wrong?

Organisations use shared services as a way of streamlining their HR activities, typically concentrating transactional activities into a centralised and commonly shared function. The shared service model can help businesses reduce costs and increase the efficiency of processes and allow a greater focus on HR strategy.

When done well, HR Shared Service Centres (HRSSC) add untold value to an organisation. However, get it wrong and it can ruin employee experience and destroy the relationship between HR and the wider business. But why does it fail?

You haven’t engaged the business in the change

When you implement an HRSSC, two groups of people need properly consulting. The people working in the shared service centre and those who will be using it. Both of these groups are equally important. You need to take your customers on the journey with you and engage and influence, in order for them to understand how you’re changing the way they currently do things. If either of these groups of people aren’t engaged, the SSC simply won’t work.

You have rushed it

Delivering an HRSSC into a business takes time. It isn’t something you can decide to do and then implement within 2 weeks. You cannot do it half-arsed. There are a lot of things to consider – from mapping out processes and ensuring you have the right technology, right down to hiring and onboarding the right talent. All of these things take time. If you rush any areas and don’t give them the time and attention they need, the chances are they will fail.

You don’t use analytics to measure success and continuously improve

Establishing the right metrics to analyse in an HRSSC is the key to success. By monitoring data, you can see how your teams are performing and highlight inefficiencies and potential problem areas, that may need investigation.

Measuring results and data enables informed decisions to be made that drive your HRSSC to continually develop and run better. This gives your HR teams the resources they need to be successful, provides employees with a better experience and ultimately gets the business results you want.

Poor leadership

Having the right leader is important for any team, particularly in a shared service environment. If you have the wrong leaders in a shared service centre, the wheels can fall off the entire operation, leaving you with an unhappy, disengaged team who lose their passion for delivering excellence. When this happens, the knock-on effect across the business can be immense.

A good shared service leader should be able to look beyond the SSC and understand the impact it has on employees, as well as customers and clients.

You don’t have the right technology

Technology is a fundamental component of any HRSSC. If you don’t have the right technology, then the SSC just won’t work. So, you need to check that your current HR systems are fit for purpose. Take time looking at your current systems and processes and what you need them to do. HR tech is a big investment, so make sure you choose the right one. Meet multiple vendors, get demonstrations – and challenge them, to make sure the system does everything you need it to. Modern HR technology allows HR to manage incoming requests, review case histories and related employee files, provide consistent responses and escalate a case when necessary.

You are probably reading this and wondering why I am writing all of this, because it all seems like common sense, right?

You would be amazed at how often people miss out one of the key elements to ensure their HR Shared Service Centre is a success.

So, do you agree? Have you had a Shared Service function which is been fantastic or failed spectacularly? Share your experiences!

If you would like to find out more about re:find and how we can support you and your business then please get in touch.

James Cumming is our MD, Interim and Transformation Search specialist. If you’ve got a hard-to-fill role and need some help, get in touch. Connect with him on LinkedIn.