Shared Services Evolve as Business Value Increases

As shared services continue to provide process and cost efficiencies, the key functions and characteristics of shared services centres are evolving, according to Deloitte’s biennial survey on shared and global business services.

Amid an uncertain business environment and rapid change, many organisations have turned to shared services centres (SSCs) to streamline specific tasks and processes in IT, finance, HR, and other business functions. CIOs and other business leaders are increasingly able to leverage SSCs to improve process efficiencies and reduce costs while maintaining work quality and internal controls, according to Deloitte’s 2017 Global Shared Services Center Survey.

Nearly three-quarters (73 percent) of survey respondents report shared services productivity increases of at least 5 percent, up from 70 percent in 2015. Average annual productivity improvement is approximately 8 percent, consistent with previous surveys. As SSCs continue to provide value to the enterprise, their functional scope continues to broaden, with more and more SSCs delivering traditional knowledge-based services.

Businesses continue to adopt multifunctional SSCs. Survey participants report an average of three functions within their SSCs, and the number of SSCs with three or more functions increased from 31 percent in 2015 to 53 percent in 2017. Along with finance and HR, IT is one of the top three most popular SSC functions, consistent with previous surveys.

Although transactional processes remain the predominant type of work performed by SSCs, many organisations are finding additional ways to create value. Adoption of more complex, knowledge-based processes has doubled—or in some cases even tripled— since 2013, a trend that likely reflects SSCs’ increasingly sophisticated capabilities.

Most IT SSCs provide a mix of knowledgebased and transactional technology processes. Among those surveyed, the IT service desk capability is the most frequently included technology process, followed by a number of application development and management tasks.

Expansion plans are further testament to the success of SSCs: Forty-four percent of respondents indicate plans to establish new centres or consolidate existing ones to further optimise their geographic footprint. The survey found that SSC expansion strategies are changing. For example, compared to 2015, more respondents (27 percent) are employing a regional SSC model (in which one centre serves one geographic region) and increasingly are opting for multiregional and global geographic models (19 percent and 21 percent respectively).

While cost remains a top consideration when choosing a location, organisations are increasingly placing a high priority on proximity to their existing operations or headquarters. The top five countries considered by companies for new or relocated centres are mostly consistent with the 2015 survey— the U.S. unseated India for the No.1 spot, and Mexico replaced Brazil in the top five. India remains a relatively low-cost option and continues to be one of the more popular SSC locations.

Technology is critical to the ability of SSCs to drive cost and process efficiencies and will likely become even more important as the SSC model matures. In particular, robotic process automation (RPA) is rapidly emerging as a technology that could significantly alter shared services. Forty-four percent of respondents say that increased focus on automation and robotics would improve their shared services journey.

RPA has the potential to fundamentally change how SSCs operate and deliver service to customers. By automating repetitive and rule-based tasks and processes, RPA can greatly reduce the effort required to complete routine tasks and allow employees to shift their focus from mundane or errorprone tasks to value-added activities. Because it drives data standards and consistency, RPA could also lay the groundwork for more advanced cognitive technologies that augment or replace the need for human judgment in complex, knowledge-based processes, enabling SSCs to efficiently perform higher-value tasks and analysis. According to the Deloitte survey, 8 percent of organisations are already harnessing the power of RPA, 26 percent are conducting or planning a pilot, and 24 percent have begun initial research.

Sixty-three percent of survey participants say they expect the use of robotics to significantly or somewhat increase in their SSCs. More than a third of respondents (36 percent) believe RPA will deliver savings of 20 percent or more.

The ongoing expansion and evolution of SSCs reflects their success in delivering cost savings and process efficiencies. As CIOs and other SSC leaders plan for the future of shared services across their organisations, they are exploring how RPA—and beyond that, advanced cognitive technologies—can be applied to the appropriate processes and activities to transform the way shared service organisations operate, deliver services to customers, and continue to provide value to the enterprise. For more information, please visit www.deloitte.com/mt/sscs