Strategic Perspectives and Tactical Opportunities for ...The most important factors in selecting the current SSC location(s)? Geography Location factors • As seen in prior surveys,

Treasury and Trade Solutions

Strategic Perspectives and Tactical Opportunities for Shared Service Centers

Fraser RossSenior PartnerDeloitte Consultinge: [email protected]

Contents

About the survey

Survey results:– Geography– Organization and governance– Scope– Operations– Journey and value

Copyright © 2013 Deloitte Development LLC. All rights reserved.2013 Global shared services survey results

About the survey


The 2013 Global Shared Services survey attracted 277 respondents…

Manufacturing, 59

Consumer Products, 43

Financial Services, 37

Tech/Telecom, 35

Retail, 28

Health Care, 18

Energy, 16

Media, 14

Public Sector, 12

Travel & Hospitality, 11 Others, 4

– …representing organizations headquartered in 38 countries across the globe…

– …providing data for 870 Shared Services Centers (SSCs)

– Average revenue of participant organizations was approximately $10 billion

– 50% of respondents had over 10,000 FTEs

The organization’s primary industry sector?

Organization annual revenues?

29% 30%

18%23%

Less than $1B $1B to less than$5B

$5B to less than$15B

$15B +

Less than 1,000, 13%

1,000 to 10,000, 37%

10,000 to 25,000, 17%

25,000 to 100,000, 20%

100,000 and above, 13%

As used in this document, “Deloitte” means Deloitte LLP and its subsidiaries. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

Demographics

What is the size of your total organization in FTEs?


Geography


The organization’s Shared Service Centers locations?

India(58)

Korea (2)

Argentina

Brazil

Czech Republic

(11)

Romania(7)

Australia (18)

Singapore (9)

Malaysia(11)

Thailand (4)

Japan (6)China (31)

(21)

Chile(9)

Brazil (40)

Mexico(21)

United States(165)

Canada(39) United Kingdom

(51)

Spain (41)

France (9)

Switzerland (4)

Denmark (16)

Russia (6)

Norway (11)Sweden (21)

Ireland (8)

Italy (2)

Portugal (5)

Netherlands (26)

Germany (46)

Hungary(14)

New Zealand (1)

Poland (18)

Costa Rica (13)

Colombia(25)

South Africa (3)

Philippines (20)

Egypt (2)

Peru (1)

Slovakia (5)

Austria (2)

Mauritius (2)

Panama (2)

Bulgaria (3)

Qatar(10)

Belgium (6)

Bahrain (1)Bhutan (1)

Burkina Faso(1)

Dominican Republic (1)

Fiji (1)

Ghana(1)

Iceland (1)

Kenya (1)

Laos (1)

Lithuania (1)

Monaco(1)

Samoa(1)

Taiwan (1)

Uruguay (1)

Vietnam (1)

Estonia (2)

Finland (28)

40 + SSC’s 20 - 39 SSC’s 10 - 19 SSC’s 1 - 9 SSC’s No SSC’s

The number of SSCs in the U.S. is approximately the same, however, more were noted in Canada

compared to 2011

Significant increase in the number of centers in

LATAM, especially in South America The number of centers reported in Asia remained relatively

constant; however, a substantial increase was reported in India

More SSCs represented from Scandinavian and Eastern

subregions of Europe


Provide services for a single country only, 36%

Provide services across countries, but within a single continent only, 34%

Provide services across two continents, 13%

Provide services across three or more continents, 18%

LATAM, 29%

E. Europe, 21%

APAC, 19%

W. Europe, 11%

US/Canada, 9%

India, 8%Other, 4%

What is the global reach of the SSC’s?

Decentralized , 33%

Regional centers , 41%

Hub and spoke , 26%

What is the predominant deployment model for your Shared Services organization?

What is the geographical coverage of your SSCs?

Geographies served based on maturity of center

68% 73% 71% 68% 70%

11%13% 13% 12% 4%

21% 14% 16% 20% 26%

< one year One year to threeyears

Three years tofive years

Five years to 10years

10 years +

One continent Two continents Three+ continents

Geography

What regions are being considered for a new SSC?


4%

5%

7%

7%

14%

14%

14%

17%

17%

22%

23%

32%

19%

29%

33%

24%

32%

14%

36%

53%

35%

56%

Cultural synergies (nonlanguage)

Tax impacts/advantages

Regulatory/legal

Risk profile (political, social, etc.)

Close proximity to headquarters

Close proximity to currentoperations

Other

Language skills

Labor availability

Labor cost

Labor quality

Extremely important

Very important

The most important factors in selecting the current SSC location(s)?Geography

Location factors

• As seen in prior surveys, labor factors continue to drive the decisions on location selection• Labor cost continues to be an important consideration surpassing labor availability this year• Proximity to current operations increased in importance over the last two years, but remains a lesser driver• Other reasons for location selection included existing facilities and synergies with existing technology

infrastructure


Geography

23%

15%

13%

13%

8%

China

Philippines

India

United States

Malaysia

From where are your SSCs providing services for China, India, and Japan?

65%

7%

7%

7%

5%

India

Malaysia

Philippines

United States

Finland

53%

9%

9%

6%

6%

China

United States

Malaysia

Philippines

Singapore

– 43% of respondents have SSCs that service Japan, Brazil, Russia, India, and/or China

– China and Brazil are nearly equally serviced by SCCs within and outside of the country

– The top cities in China with SSCs serving China are Shanghai, Beijing, Chengdu, Dalian, Guangzhou, and Tianjin

– India is predominantly serviced by SSCs within the country located in Bangalore, Gurgaon, Chennai, New Delhi, Kolkata, and Pune

From where are you serving China?

Countries serving Brazil, Russia, India, and China (BRIC) and Japan

From where are you serving India?

From where are you serving Japan?


– Organizations appear to be developing the ability to service multiple continents from one center—and driving towards making global centers a reality

– Newer entrants, across company size, are learning from the lessons of others and are increasingly more adventurous in functional scope, alternative delivery, and locations considered

– Organizations have become more open in their location selection for SSCs as compared to 10 years ago; the dispersion of centers across the world is much greater than it was 10 years ago with newer centers opening across a greater array of countries and cities in the global theatres

– Of the BRIC countries serviced by SSC’s, China and Brazil are serviced equally by in-country and out-of-country SSCs. India is predominantly serviced by SSCs within the country and Russia from SSCs outside of the country.

– Labor factors continue to drive location selection for SSCs — and cost remains a perennial top driving factor

Trends in geographyGeography


Organization and governance


Organization and Governance

How are SSCs organized and managed?

75%

75%

74%

69%

62%

44%

39%

33%

7%

Lower management cost

Shared governancestructure

Shared continuousimprovement initiatives

Lower overhead expenses

Ability to share staff

Improved career models

Ability to use single SLAs

Combined vendormanagement

Other

24% 15%

17% 33%

21%21%

38% 31%

Orgs with SSCs < five years Orgs with SSCs > five years

– Over 50% of respondents have Shared Services for multiple functions that are at least co-located if not managed as a single SSO

– While more mature organizations had multiple functions in Shared Services, the functions were still physically separate and separately controlled

– Respondents with newer centers had a higher percentage of functions combined and managed as a single organization

– Co-location has driven lower management and overhead costs while enabling shared governance and continuous improvement

How are your SSCs organized and controlled? Do organization and control vary by maturity?

Shared Services organizationWhat have been the benefits of housing multiple functions in one location?

20%

24%

22%

34%

• SS for one function only

• Multiple functions• Physically separate• Separately controlled

• Multiple functions• Co-located• Separately controlled

• Multiple functions

• Co-located • Managed as a

single Shared Services organization (SSO)

A

B

C

D

A

B

C

D

A

B

C

D


The predominant reporting relationship for SSCs?

57%46%

16%

14%16%

30%

9%

5%

8%

9%

8%

11%

11%24%

34%

– Over 50% of respondents cited reporting relationships to either the function or in-country leadership. However, almost 25% of respondents have transitioned to an independent SSO

– The percentage of respondents with SSCs reporting to an independent SSO increases as you start to manage multiple functions as a single organization

What is the predominant reporting relationship for your SSC?

When multiple functions are in Shared Services, where do they report?

What have been the benefits of housing multiple functions in one location?

A

B

C

D

A

B

C

D


• Physically separate

• Separately controlled


• Co-located

• Separately controlled


• Co-located

• Managed as a single SSO

Primary ownership by

function

Primary ownership by in-

country leadership

Primary ownership by in-region leadership

Primary ownership by

one of the business

units/segments

Independent shared services

organization

A

B

CDE

A

B

C

D

E

36%

23%

8%

11%

22%



Who has responsibility for your SSCs?

– Similar to the 2011 survey, almost half of the respondents have created a formal position to manage their SSCs

– CFO continues to be the primary top executive responsible for the Shared Services organization according to respondents

– 50% of the organizations surveyed that had multiple functions co-located created a leader for the overall Shared Services organization

Has a position been created to manage the collection of SSCs across your organization?

To whom does the most senior leader of your Shared Services organization report?

SSC responsibilityIs a position more likely to be created if you have multifunctions co-located?

Yes, 44%

No, 56%

CFO, 48%

CEO, 16%

Controller, 9%

COO, 7%

Other, 6%

CHRO, 5%CAO, 5% CIO, 3%

37%

37%

50%

49%

63%

63%

50%

51%

For one function only

For > one function, physically separate,separately controlled, & managed

For > one function, physicallycombined,separately controlled, & managed

For > one function, physically combined,managed as a single SSO

Yes No



The primary SCC charge back mechanism?

5%

5%

8%

9%

13%

19%

30%

50%

Services are charged based onmarket pricing

Penalty pricing / charges

Services are cost adjusted basedon performance

Other

Costs are allocated based onrevenue

No billing or allocation of costscurrently exists

Costs are allocated based onheadcount

Services are charged based onvolume/services


• Services charged based on volume continue to be the primary chargeback model used by respondents, up from 42% in 2011

• The survey indicates there are minimal differences in chargeback models between those that mandate and those that utilize an opt-in model

• The primary difference with a mandated model is that a higher percentage of organizations do not allocate costs at all — 29% versus 16% of those with an opt-in model

Chargeback models



SLAs are common and somewhat effective tool for governance?

– Over 75% of respondents use SLAs to drive governance

– 96% of respondents find SLAs at least somewhat effective

– For those respondents that find SLAs very effective, 95% revisit them at least annually if not more frequently

Does your Shared Services organization leverage SLAs to drive governance?

SLAs

How often are they revisited?How effective do you find SLAs?

Yes, 77%

No, 23%

Very effective, 29%

Somewhat effective, 67%

Not effective, 4% Rarely, 13%

Quarterly, 12%

Biannually, 18%Annually, 55%

Every five years, 3%


Who is driving SSC’s end-to-end process efficiency and effectiveness?Organization and Governance

54% 54%

49%46%

44% 43%

38%35%

33% 32% 32%

38%35% 35%

39%36%

20%

29%

22%25%

20% 20%23% 22%

4%

11%

32%

6%2%

15%12%

5%

Own and updatepolicies

Proactive processredesign /continuous

improvement

Request changes totechnology

configuration

Monitoringperformance metrics

Revising roles andresponsibilities

Help incorporatenew business units /

locations

Responsible forissue resolution

Managing andreviewing SLAs

Global Process Owners Regional Process Owners Process Councils ERP / Tech Application Owner

– The survey indicates global and regional process owners are the most common roles used to drive efficiency and effectiveness across an organization’s SSCs

– Global process owners play the largest role in driving policy, process, and technology changes and continuous improvement

– Respondents indicated a wide variety of responsibilities for regional process owners with issue resolution being a primary role

Governance roles


Trends in organization and governance

– As organizations move from single function to multifunction, there is a movement away from functional or country reporting relationships towards reporting into an independent Shared Services organization

– Even if organizations are not managing the functions in Shared Services as a single Shared Services organization, they are seeing numerous benefits from co-locating the functions

– Chargeback mechanisms vary widely, however, there is an increasing number of organizations that are not billing or allocating costs at all — specifically those organizations that mandate Shared Services

– Organizations are also using penalty pricing as a means to drive behavior between the SSC and its customers

– SLAs continue to be an important tool in governing the relationship between the SSC and the business, however, they require at least annual monitoring to remain effective

– Organizations are increasingly using global process owners to drive process efficiencies and standardization across the Shared Services organization



Scope


What is the scope of your Shared Services Organization?Scope

Which functions are in your organization’s SSCs? Overall scope

• The traditional back office functions, Finance, HR, and IT, continue to be those most often moved into Shared Services according to respondents

• There was an increase in the number of respondents with Legal and Real Estate in Shared Services

• 43% of the SSCs represented in the survey have more than one function in their center

• 85% of respondents have at least one multifunctional center

• The more mature the center, the higher number of functionsper center

Average number of functions by SSC maturityWhat percentage of the SSCs are multifunctional?

93%

62%

52%

41%

39%

35%

27%

20%

18%

17%

Finance

Human resources

Information technology

Procurement

Customer service/Support

Tax

Real estate/Facilities Management

Legal

Sales/Marketing

Supply chain/Manufacturing support

One function, 57%

Two functions, 15%

Three functions, 8%

> Three functions, 20%

60% 60% 58% 57%41%

22% 16% 13% 14%

13%

3%5% 9% 10%

9%

14% 20% 19% 19%37%

0%

25%

50%

75%

100%

Less than oneyear

One year to lessthan three years

Three years toless than five

years

Five years to lessthan 10 years

10 years orlonger

One function Two functions Three functions > Three functions


Scope

Outside of the local business, how are FTEs distributed?

43%

36%

35%

30%

27%

25%

24%

16%

15%

12%

8%

26%

8%

17%

12%

13%

14%

14%

6%

23%

12%

8%

8%

9%

13%

8%

21%

23%

19%

14%

38%

30%

48%

44%

47%

54%

41%

47%

60%

51%

Supply chain/Manufacturing support

Sales/Marketing

Customer service/Support

Human resources

Legal

Finance

Procurement

Information technology

Real estate/Facilities management

Tax

Local Corporate Knowledge-based SSCs/ COEs Transactional SSC/Outsourced

• The survey indicates Real Estate/Facilities and Finance have the largest percentage of FTEs with a transactional SSC or outsourced model

• IT and Procurement have the largest percentage of FTEs leveraging knowledge-based SSCs or centers of excellence (COE)

• Although 25% of Tax FTEs remain in corporate, organizations have transitioned over 50% to transactional SSCs or outsourcing

Non-local FTEs

Note: Results displayed above are for respondents who noted the function as being in Shared Services


How do you expect your organization to change their use of Shared Services and outsourcing in the next three to five years?

Scope

How do you expect your organization to increase the use of Shared Services?

How do you expect your organization to increase the use of outsourcing?

• As compared to 2011, respondents indicated an interest in expanding the use of outsourcing across all areas

• Respondents continue to expect to increase the use of outsourcing for transactional processes

Future direction for outsourcingFuture direction for Shared Services• Similar to the 2011 survey, the majority of survey participants plan

on expanding the scope and reach of their SSCs

• There was a large jump in respondents planning to expand the # of knowledge-based processes in SSCs from 66% in 2011 to 82%

82%

82%

81%

73%

# of transactionalprocesses in SSCs

# of knowledge-based processes

in SSCs/COEs

% of internalbusiness units

being served bySSCs

# of geographies/regions being

served by SSCs

49%

24%

35%

33%

# of transactional processes beingoutsourced

# of knowledge-based processesbeing outsourced

% of internal business units beingserved by outsourcers

# of geographies/regions beingserved by outsourcers


Trends in scope

– SSCs continue to expand outside of traditional back office functions

– Organizations leveraging Shared Services are moving upwards of half to three quarters of their FTEs to an alternate service delivery model

– Even traditional corporate functions, such as Tax, Real Estate/Facilities, and Legal are moving towards a transactional SSC or outsourced model

– The capabilities of transactional SSCs and outsourcers are moving up the value chain such that knowledge-based SSCs/COEs make up a smaller portion of FTE distribution

– Organizations are beginning to leverage Shared Services as a way to manage customer relationships with contact centers and customer service desks

– Processes that are being considered future Shared Services candidates centered around managing data and driving business insights regardless of functions

Scope


Operations


Which of the following internal processing technologies/enhancements has and/or will be implemented in your Shared Service Center(s)?

Internal processing technologies/ enhancements • Respondents indicated that 75% of technology spend was allocated to improving productivity within center operations• The top 5 technologies currently implemented remain the same since 2011• Employee self service increased substantially since 2011 (48%) to 62% this year according to respondents• Survey results indicate a significant increase in Software as a Service (SaaS) implementations (from 18% to 28% since

2011), and large increased in planned investments in cloud computing

Operations

* Top 10

75%

73%

67%

67%

66%

62%

60%

57%

57%

55%

Electronic funds transfer (EFT)

Workflow

Electronic data interchange (EDI)

Payroll services / Direct deposit

Financial consolidation/reporting

Employee self-service

Data warehousing

Imaging

Automated three-way matching

E-invoicing

Currently implemented *

39%

35%

34%

32%

32%

30%

27%

26%

26%

22%

Data analytics tool

Vendor self-service

E-procurement

E-invoicing

Business process management systems

OCR

Cloud computing – public

Cloud computing – private

Demand forecasting / capacitymanagement

Asset tracking

Future/planned implementation *


Which of the following customer facing technologies/enhancements has and/or will be implemented in your Shared Service Center(s)?

Customer-facing technologies/enhancements• Respondents indicated that 18% of technology spend was allocated to improving customer interactions• The top 10 technologies are consistent since 2011, however, a higher percentage of respondents have implemented

each one• PDA access and social media have moved into the top 10 technologies respondents are considering implementing in

the future

Operations

70%

59%

56%

54%

40%

37%

36%

35%

31%

26%

Workflow

Electronic document management

Call center

Portals

Chat (IM/OC)

Data mining and reporting

Automated call distribution (ACD)

Case management

Vendor self-service

Interactive roice response (IVR)

Currently implemented *

42%

39%

31%

29%

28%

27%

26%

25%

24%

19%

Data mining and reporting

Vendor self-service

Knowledge management for customerservice case resolution

Electronic document management

Case management

Portals

PDA access

Social media

Computer telephony integration (CTI)

Workflow

Future/planned implementation *

* Top 10


What is important to your business unit customers?Operations

How important is each of the following to your internal business unit customers?

SSC customer needs• Timeliness of response remains the most important service that SSCs can provide to customers since

2007according to respondents

• Cost of services has increased in rank since 2011 from #4 to #2

• Anticipating business unit needs or providing non-routine services remain the least important services to customers, however, providing non-routine services has increased in importance since 2011

Anticipating unidentified business unitneeds

Providing nonroutine services

Staff knowledge of business unitobjectives

Staff knowledge of multiple SSOprocesses

Reacting to business unit requests

Providing routine services

Cost of services

Timeliness of response

2013

2011


8%

9%

11%

13%

14%

22%

24%

27%

49%

22%

51%

50%

40%

50%

49%

42%

Maintaining desired capability levels

Recruiting and retaining clerical staff

Career planning and progression

Maintaining strong morale

Recruiting and retaining managementstaff

Maintaining high customer servicelevels

Maintaining high process efficiency

Maintaining high quality

Extremely significant

Very significant

What people-related challenges do you anticipate within your organization's SSC(s) over the next three years?

Challenges• Operationally focused people-related challenges continue to top the list with maintaining high quality moving up from

#2 in 2011 to #1 this year

• Maturity of the respondents’ SSCs did not impact what people-related challenges were anticipated

• Anticipated challenges with recruiting and retaining both management and clerical staff have gone down since 2011

Operations


How do you attract and retain talent in your Shared Services organization?

Methods used to motivate employees• Respondents indicate their SSCs faced an average of 8% employee turnover, down from 9% in 2011

• The focus on strong culture remains a top way to attract and retain talent while job rotation outside of the SSC has increased in importance

• Other ways organizations attract and retain talent within the SSC is by expanding responsibilities to include ad hoc projects

Operations

9%

45%

51%

55%

55%

63%

Other

Performance based pay (e.g.,variable bonuses)

Financial support forcontinuing education

Job sharing / flexible workpractices

Job rotation outside of theSSC into other areas of the…

Focus on strong culture

What is your annual percent in employee turnover by center?

Less than 5%36%

5% to less than 10%

30%

10% to less than 15%

13%

15% to less than 20%

12%

Greater than 20%8%

What benefits do you use to attract and retain talent?


Trends in operations

– Higher quality has become an important reason for business units to opt in to Shared Services signifying that cost is not the only consideration

– There is an opportunity for Shared Services to move from an execution to a management-based role in internal controls for the broader organization

– While technology spend is primarily allocated to productivity, there is a growing trend to build enabling technologies to improve the customer experience

– As SSCs expand their breadth of services, they should consider continue to deliver on the basics such as timeliness of response and cost containment

– Challenges with attracting and retaining talent have decreased as SSCs find innovative ways to make Shared Services a career destination

Operations


Journey and value


How has process standardization and technology impacted your SSC’s?

Journey and valueDid you standardize processes before, during, or after the move to Shared Services?

Process migration

Did you move processes to Shared Services before, during, or after technology change?

• As in 2011, nearly half of the respondents standardized processes after shifting them to Shared Services

• Compared to 2011, 15% fewer respondents moved processes after the technology change versus at the same time

• The survey indicates the most popular approach to implementing SSCs continues to be to move processes prior to standardization and technology changes

First standardized

processes15%

First moved to shared services

49%

Standardized processes and

moved to shared services at the

same time36%

Moved processes before

technology change

42%

Moved processes at the

same time as technology

change39%

Moved processes after

technology change

19%

Timing of process move to SSCPrior to technology change

During technology change

After technology change

Timing of process standard-ization

Prior to move to SSC

2% 7% 6%

During move to SSC 10% 19% 6%

After move to SSC 30% 13% 7%


Where has Shared Services had a positive impact?Journey and value

47%

42%

39%

39%

39%

32%

29%

21%

20%

20%

16%

12%

12%

2%

41%

50%

48%

42%

44%

51%

52%

48%

37%

55%

35%

46%

35%

14%

Cost reduction

Process efficiency

Effectiveness of internal controls

Data visibility

Platform to support growth/scalability

Process quality

Cross-organization comparability

Removal of distractions from core business

Ability to meet regulatory requirements

Service levels

Acquisition/M&A synergies

Developing new talent

Working capital

Tax benefits

Significant positive impact

Somewhat positive impact

Positive impacts of SSCs

• The top five benefits remain consistent since 2011• Respondents indicated a wide variety of benefits with cost reductions being the top• An increased number of respondents are finding that Shared Services enables M&A synergies as compared to 2011


What is the financial impact of Shared Services?Journey and value

What is the average headcount reduction you achieved during the first 12 months after implementation of your SSCs?

Financial Impact

After the first 12 months, what is the average annual increase in productivity (headcount reduction or cost avoidance) achieved by your SSCs?

• 55% of respondents indicated an initial headcount savings of 10% or more

• The survey indicates average initial headcount savings is approximately 13%

• Average annual increase in productivity is 8%, consistent with the last four years

• Over the last 10 years, the average payback period has decreased from three to 2.6 years according to respondents

What was the payback period for your Shared Services implementation?

16%

24%

32%

19%

4%

No reduction 0% to 10% 10% to 20% 20 %to 30% More than 30%

9%

25%

37%

16%12%

NoneLess than 5%5% to lessthan 10%

10% to lessthan 15%

15% or more

Less than one year after

implementation10%

Between one and two years after implementation

34%

Between two and three years after implementation

28%

Between three and four years

after implementation

16%

Over four years12%


To what degree has your organization achieved its objectives for Shared Services?

Journey and value

15%

15%

15%

16%

17%

20%

27%

28%

31%

41%

One-time costs

Number of geographies served

Number of processes in scope

Number of business units served

Time to implement – center set up

Headcount reduction

Size of retained organization

Time to implement – fully deployed

Technology standardization

Technology automation

Short of meeting objectives

16%

17%

17%

18%

18%

19%

19%

24%

26%

30%

Number of geographies served

Technology automation

Time to implement – center set up

One-time costs

Technology standardization

Number of business units served

Types of processes in scope

Number of processes in scope

Headcount reduction

Service quality

Exceeded objectives

Achieving objectives

• At least 50% of respondents met or exceeded all of their objectives• Service quality was the area most cited for exceeding objectives followed by headcount reduction, which was

the top answer in 2011• Similar to 2011, technology automation and standardization were the top areas cited for being short of meeting

objectives


How could you have improved your Shared Services journey?Journey and value

7%

26%

29%

38%

39%

43%

47%

59%

Other

Better reporting

Faster decision making / issue resolution

Better team / resources

Stronger governance

Stronger executive support / alignment

Better alignment between process change and technology change

Increased change management

Changes to journey

• Similar to 2011, over half of respondents indicated the need for increased change management• Respondents continue to struggle with aligning process change and technology change• Other included improved analysis around location selection and not allowing an opt-in strategy


Journey and value

How can Shared Services be leveraged as a strategic asset?

How are you leveraging Shared Services as a strategic asset at your organization?

What role(s) is your SSC(s)/organization currently playing, or you anticipate it playing, in analytics?

SS as a strategic asset

63%

55%

36%

32%

27%

31%

36%

43%

36%

55%

Demonstrating cost competitiveness (e.g., lower cost/unit)

Providing flexibility to ramp up/down with business demands

Offering heart of the business / core centers of expertise

Increasing ease of facilitating acquisitions

Performing analytics for business units/corporate

Achieving today Future goal

63%

45%40%

Using analytics toidentify / improveShared Services

performance within thecenter

Providing analyticsservices to the business

Using analytics toprovide business

insights

• The survey indicates demonstrating cost competitiveness is a main focus in SSCs today

• Moving into analytics was noted as the top future goal by over half of the respondents

• Of the 82% of respondents who are/or plan on performing analytics for their organization, 63% are focused on improving performance within the center


Journey and value

3%

3%

4%

8%

30%

32%

31%

35%

39%

24%

61%

63%

55%

55%

45%

57%

7%

4%

11%

6%

12%

11%

1%

1%

Shared Services will become virtual eliminatingthe need for physical centers and facilities

Increasing automation and self-service will eventually cause Shared Services centers to go

“lights out”

The majority of enabling functions will eventuallybe moved to third parties

SSCs will serve external organizations andbecome profit centers

Shared Services will continue to expand into newgeographies

Shared Services will continue to expand intohigher value processes

Strongly agree Agree Disagree Strongly disagree

In what areas do you think Shared Services will evolve in the future?

Future trends

• 95% of respondents believe that SSCs will continue to provide critical and high-value processes for their organizations

• The survey indicates SSCs serving external organizations and becoming profit centers is the lowest agreed-upon trend followed by the emergence of virtual SSCs


Trends in journey and value

– Organizations are effectively achieving benefits regardless of the order of implementation across functions and geographies

– More recent adopters of Shared Services are moving directly to multifunction as part of their initial implementation strategy

– Organizations continue to leave money on the table and increase their risks by not including Tax implications as part of their business case for Shared Services

– A multifaceted approach to addressing the retained organization is required to realize the intended benefits

– Shared Services continues to strive to be seen as a valuable partner to the business versus just a lower-cost alternative; SSCs see analytics as an important lever to increase their value

– The true value of analytics is leveraging the data, people, and technology infrastructure within the SSC to provide business insights to the broader organization

– Although Shared Services is a mature concept, the next generation includes higher value processes, new geographies, and a higher utilization of hybrid models, including SSCs, COEs, and outsourcers

Journey and value


This presentation contains general information only and is based on the experiences and research of Deloitte practitioners. Deloitte is not, by means of this presentation, rendering business, financial, investment, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte, its affiliates, and related entities shall not be responsible for any loss sustained by any person who relies on this presentation.

Copyright © 2013 Deloitte Development LLC. All rights reserved.Member of Deloitte Touche Tohmatsu Limited

Documents

Strategic Perspectives and Tactical Opportunities for ...The most important factors in selecting the current SSC location(s)? Geography Location factors • As seen in prior surveys,