Companies that have centralized their IT functions have now begun to take a close look at the technology services that their IT departments offer to internal customers and assess where it makes sense to provide certain technology components as a shared service. E-mail and analytics operations were obvious candidates; Many organizations with document-intensive operations deploy analytics centers as a shared service. The Government of Canada created Shared Services Canada on August 4, 2011 to consolidate its data centres, networks and email systems.  This follows a trend towards centralization of IT services, followed by the provinces of British Columbia, Quebec and Ontario, as well as the federal government of the United States of America and some states such as Texas. PriceWaterhouseCoopers recommended the integration of government data centres in a report commissioned by Public Works and Government Services Canada, published in December 2011.  The introduction of shared services can also lead to problems within an organization. For example, employees who have provided the services in different business units may be frustrated by the loss of control they experience under the new agreement. In addition, head office employees who offer shared services from a central location may feel uncomfortable treating business units as customers. In fact, the shift to a shared services environment requires employees to learn new skills, with a greater focus on flexibility and customer service. “To be the preferred provider — and even to have a secure business existence — the shared service must provide superior profitable results,” Sherman said. Therefore, a shared services system is not suitable for all businesses. “For many companies, shared services will remain a fascinating concept that simply doesn`t meet their needs,” Henricks noted. “For others, it will just be the right model to take advantage of a promising opportunity to make the most of home office skills that other departments, locations, and even other businesses can also take advantage of.” The difficulty with this argument is that near-shore and offshore services are generally associated with the outsourcing model and are difficult to reconcile with the notion of internal shared service as opposed to externally acquired service.
It is clear that the use of offshore facilities by a government agency is not an example of shared services. It is sometimes argued that there are three basic variations of location for a shared service, including: The UK government is working on a comprehensive plan to realize the benefits of shared services as part of a central quest for efficiency resulting from the Gershon review. Cabinet Office has established a dedicated team to accelerate adoption and develop a strategy for all ministries to come together and consolidate. The potential savings from this transformation in the UK public sector were initially estimated by the Cabinet Office at £1.4 billion per year (20% of the estimated cost of human resources and financial functions). The National Audit Office (UNITED KINGDOM) pointed out in its November 2007 report that this amount of GBP 1.4 billion did not lack a clear cost base and contained several uncertainties, such as. B the initial expenditure required and the timing of savings. Large-scale cultural and process change can be a key part of the transition to shared services and can include layoffs and changes in work practices. It is claimed that transformation often leads to a better quality of life for employees, although there are few case studies to prove this . “Shared Services” is a term that defines an operational philosophy that centralizes a company`s administrative functions that were once performed in separate departments or locations.
Services that can be shared by the different business units of a company include finance, purchasing, inventory, payroll, hiring, and information technology. For example, a head office could control the entire framework of an entire chain of retail stores. The term “shared services” may also apply to partnerships between separate companies. In this case, tenants of an office building may share telecommunications or maintenance services. Shared services are also available on the Internet. An example of this form of shared services is that of application service providers (ASPs), which provide many business customers with access to online applications to avoid purchasing special systems and software. 5. Ongoing monitoring. A joint service agreement should be treated as a contract and the terms and conditions should be monitored regularly to ensure that they are met. Shared services are similar to the collaboration that can take place between different organizations, such as a hospital trust or a police service. For example, neighbouring trusts may decide to work together by merging their HR or IT functions.
A shared service can support a variety of different business structures. Core business structures include: 6. Long-term review/re-evaluation of the agreement. Changes to the service environment may require regular review of the agreement. The initial assumptions or parameters surrounding the agreement may need to be adjusted at different intervals. Also, don`t reinvent the wheel when writing your agreement. When creating your contract, use existing templates. .