The 3 Biggest “Shared Service Environment” Headaches
Shared service environments are a conundrum.
On the one hand, cost savings can be tremendous! On the other, though, pulling off a large-scale shared service project is – let’s be honest - far from easy.
Over the past few years we’ve assisted with a number of major shared service projects, and we’ve seen first-hand which issues pose the greatest barriers to success. Of course there are plenty of stumbling blocks along the way, but if you can get these three things right you’ll dramatically improve your chances of success.
No. 1 - Data Segregation
If we could give one piece of advice to a group of organisations embarking on a shared service project, it would be this: Begin with the end in mind.
And look, we get it. Shared service projects take months or even years to hammer out, and nobody wants to think about having to do the whole thing all over again in five or ten years. But realistically, shared service environments don’t last forever, and at some stage you will need to divide everything up.
But in the vast majority of cases, nobody thinks about the endgame when they’re setting up a shared service centre. Configuration items, services, customer information, and a whole host of other assets are combined… but nobody considers how they’ll be divided up five or ten years later when the contract term is up.
To avoid this problem, and the ticking time bomb that goes along with it, high quality data management is needed at an early stage. Ownership of individual assets and CIs must be clearly laid out, and a comprehensive plan should be devised to segregate data when the shared service contract comes to an end.
And it’s not just about the endgame. If your shared service data is clearly segregated from the start, there will be huge benefits to your ongoing reporting throughout the project. Your shared service will, for example, be able to provide bespoke reporting on services and SLAs to each individual customer organisation. These reports can be used to inform all sorts of valuable activities, such as service reviews, cross charging, and performance management.
No. 2 - Defining services
When setting up a shared service environment, properly defining services is essential. To that end, a comprehensive service catalogue should be setup.
And of course, we’re not just talking about a list of applications. In many cases, one or more of the organisations looking to build a shared service environment don’t have a comprehensive service catalogue of their own. There’s a world of difference between knowing which applications an IT department is currently supporting, and understanding all of the customer-facing services that rely on those applications.
IT personnel become overly focused on resolving technical issues, and don’t always appreciate that it’s the services as a whole that really impact the business. And of course, when several organisations decide to setup a shared service, these issues start to become a real issue.
So when you’re setting up a shared service environment, it’s imperative that you thoroughly define the services being supported. They may vary across organisations, but you’ll want to agree a set of uniform services that can be provided to each customer of the shared service environment. After all, the main purpose of the exercise is efficiency savings, and having multiple version of the same service will quickly eat away at your economies of scale.
And it’s not just the services themselves… you’ll also need to define, agree, and provide SLAs based on those services. This is a particularly weak area for many shared service environments, particularly in industries that aren’t traditionally business oriented, but considerations such as response times, fix times, hours of service, and performance targets will all need to be agreed and adhered to.
After all, once your shared service is in place each of the organisations involved becomes a paying customer. You’ll be charged for each service you receive, and you should expect to receive those services within the agreed timescales.
No. 3 - Aligning Processes
Of all the aspects of shared services, aligning processes often proves the biggest headache. From service requests to change management, shared service environments routinely end up bringing in multiple versions of services that all do largely the same thing, but which cater to individual organisations.
And of course, it’s easy to see why this happens. It’s much easier to allow each customer organisation to retain its own processes. No agreements or compromises need to be reached, and no arguments ensue.
But there’s a big problem: There’s no scalability.
Once again, the primary reason for setting up a shared service environment is to save on costs. The less standardisation that takes place during the setup period, the less savings you’ll be able to realise. Unfortunately, it really is that simple.
To avoid this, you must be able to agree standardised processes with your partner organisations. In almost all cases, the processes in place at each organisation are (for obvious reasons) very similar. Agreeing a standardised set of processes will take some time, of course, but it’s far easier than it initially seems, and will have a huge impact on the overall success of your project.