Insights /
Finance /
Article

3 Ways to Show How Valuable Shared Services Can Be

July 10, 2018

Contributor: Jordan Bryan

The benefits of shared services centers (SSCs) go beyond cost savings. Heres how to demonstrate their real value.

SSCs operate as discrete units with their own strategies, visions and mission statements — and many aspire to be value-added business partners to the internal customers and operating units they support. But very few define what it means to add value or specify how they will deliver that value.  Gartner frames the SSC value proposition in three imperatives: 

  1. Build a foundation of value with reliable, low-cost services.
  2. Simplify the level of effort in the customer experience.
  3. Provide insights that help business partners improve business performance.

Gartner provides 3 ways shared services provide value.

Provide reliable, low-cost services

SSCs primarily add value by delivering reliable services at a competitive price. Internal customers must know without question that the books will be closed, vendors will be paid, receivables will be collected and employees will be paid, accurately and on time. SSCs can standardize and consolidate work, reducing cost and required head count. This translates into low process costs for customers and greater room for internal customers to focus on their own jobs.

Productivity improvements are most obvious in the first three to four years of SSC operations, when cost savings are at their highest. After several years and productivity improvements, business leaders are less likely to celebrate the SSC — which will then need to pursue additional value-add activities.

Read more: 5 Shared Services Pricing Approaches

Add value with a simplified customer experience

Next, make it easy for customers to interact with the SSC so it can become a valuable and trusted business partner. For example, when integrating a newly acquired business unit or expanding into a new country, shared services teams can help manage the requisite processes and policies. 

As shared services organizations grow in scope and scale, consider using dedicated support teams, like continuous improvement or project management teams, which help other internal teams improve across end-to-end processes to drive better customer experiences. SSCs may also be able to access cross-organization or expensive technology not available to other functions that can drastically improve efficiency.  

Provide insights that improve business performance

SSCs can access a wealth of data, so identify ways for them to increase revenue or decrease cost using that data. Identify patterns and monitor trends across the organization to improve financial performance. Consider these examples:

  • Accounts receivable provides the history of late payments by a particular customer, enabling the sales organization to justify a price increase for the next contract term.
  • Analysis of employee expense reports reveals a large percentage of travel is from one company location to another. Business-unit leaders can encourage the use of videoconferencing or other collaboration tools to reduce travel expenditures.
  • Sales analysis identifies a market segment that is too small to warrant visits from the sales team. The SSC suggests an inside sales team be created to deal with this group of prospects.

Also ensure you document well the efforts SSCs make to improve the reliability of their services to make business easier to conduct and to improve business partner performance.

Read more: Shared Services Poised for Next-Level Robotics

Gartner CFO & Finance Executive Conference

Connect with our experienced practitioners and unbiased Gartner experts to discover innovative approaches to smarter business decisions and more.

Drive stronger performance on your most critical priorities.