Second of a two-part series.
For shared services centers (SSC) to compete in today’s economy, they must go beyond cost-cutting and achieve differentiation, using digital technologies. Doing so requires not just mastery of digital tools, but also new talent attributes and change management capabilities, as businesses are propelled to new levels of performance through organizational and cultural change. While this is a major undertaking, we’ve seen organizations succeed.
For example, several years ago, a multinational with business in 20 countries and four continents launched shared service centers in Eastern Europe and India. Both centers were output-driven and offered only transactional, routine supportive processes. The company experienced numerous issues with pricing and service quality, and users began to consider buying more competitive services externally.
The company asked us to help it define a sustainable SSC vision. We organized workshops in our Collaboratory to determine how digital technologies could be leveraged to deliver optimized, value-ized and globalized services. Together, we set up a portfolio of digital initiatives, developed a prioritized roadmap and began working in an agile way with frequent iterations in a fail-friendly environment.
The first initiative involved applying intelligent process automation (IPA) as a layer on top of existing systems in order to reduce manual labor and optimize processes. It took just a few months to achieve payback on the investment, as workers were freed to tackle more complex process activities. Additionally, the company saw faster throughput times (up to eight times shorter), fewer errors (100% accuracy), lower costs and fewer FTEs (80% reduction of humans involved in automated tasks). Higher-quality processes also decreased service level complaints.
Following that success, the organization implemented analytics and social tools. For example, fraud analytics was applied to client invoices and internal expenses to predict possible fraud at the time of submission instead of afterward, during audits. Additionally, a social platform boosted collaboration globally, connecting service consumers to each other and to the SSC workforce. Quality of service increased due to better and easier knowledge-sharing on issues and improvement areas, reducing service level issues.
We then guided the organization in its shift to begin offering additional services. The organization merged its separate SSCs into a single multi-service SSC, which now offers true global business services, including finance/accounting, procurement, human resources and IT.
To accelerate globalization, the organization launched a device-independent mobile platform, containing apps for all SSC services, and the HR systems were offered via the cloud on a pay-per-use basis. In this way, SMAC technologies enabled a standardized set of services, which could be easily scaled when expanding in function or geography (to a new service consumer).
Introducing digital technologies involved both cultural and technological change. To boost adoption rates, the organization involved both younger and older employees in pilots, as younger generations are likely more accustomed to engaging with emerging technologies. It also employed gamification to enrich the learning experience. Examples of gamification include multidisciplinary teams with mixed-age co-workers competing with each other to develop the best digital initiatives. Participation can be stimulated by adding game elements, such as team ranking and weekly prizes.
Other SSCs can learn from this experience to reinvent themselves and overcome the digital, generational and cultural challenges they are likely to encounter along the way.
To learn more, read our white papers Shared Services: How Digital Can Accelerate the Leap to Value-Added Differentiation, and Evolving Shared Services from Cost-Killer to Value-Driver, or visit the Business Process Services or Intelligent Process Automation sections of our website.