Shared Services

More and more organizations are realizing the value of shared services. Shared services are those services that are provided to two or more organizations, which pool resources to provide those services. This in theory reduces expenses since economies of scale can be employed. This is increasingly being looked at in education, non profits, and Government. Itis not as extensively utilized in private industry for a variety of reasons including security, trade secrets, competitive concerns, etc. However almost any organization can benefit to some degree from shared services and as such should be retained as an option, if not actively pursued. This template allows you to plan or manage shared services that exist between two or more organizations.

Below we have a blank shared services template which can be found at https://www.solveboard.com/solveboard/view/model/976

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How to Use:

  1. With this template you are going to first determine for which areas services are being shared. For the purposes of this template we are going to use two large farms that have decided to share services to reduce costs. The areas where they are going to share services are in administration, procurement, logistics, and IT. Picture2
  2. Once the areas of shared services have been determined you should list the specific services that will be shared within each of the areas. For example in administration the two farms plan to share accounting services, payroll processing services, and regulatory services. By sharing these services they can ensure a lower overall cost then if each were to have their own administration staff that handled it. For example one accountant can handle the accounting for both farms. So it would be less expensive if each farm paid half her wage, rather than each farm having it’s own accountant.      Picture3
  3. Now moving through the rest of the areas, list those specific services that will be shared between organizations. As you can see below the two farms have developed an extensive collection of shared services. They share trucks and grain sites. They have a buyer who handles procurement for both farms, employing economies of scale to bring down material and equipment costs.      Picture4
  4. Use the information panel for each shared service to expand the information as needed. For example if you were to click on payroll processing, you can see more information about that shared service including the frequency that payroll is made.      Picture5

You can find this finished shared services template at https://www.solveboard.com/solveboard/view/model/977

Shared services can be an excellent way to reduce costs, increase the level of competence available to your organization, and focus management on the core functions of an organization. This template is easy to use and can be easily scaled to become a comprehensive management oversight tool when it comes to shared services. It can also serve as a springboard for thinking about how a company can explore this topic.

You can find more information about shared services using the following links.
2. Deloitte “Great visual overview on the thinking about shared services worldwide.”
4. PWC “On implementation and execution of shared service relationships.”

 

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