North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
THE LESSONS LEARNED OF HIGHLY
EFFECTIVESHARED SERVICES(with apologies to Stephen R. Covey)
BC Financial Healthcare Professionals Society2013 Conference| October 1, 2013 | Vancouver, BC
7
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
2
What we will cover today
Who We Are Definitions & Trends Lessons Learned
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
3
Chazey Partners Profile
Global Offices Flexible Resource Model
Presentation handout is appended with more information on Chazey Partners
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Chazey Partners: Who We Have Worked With
4
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
5
Definitions & Trends in Shared Services
What is the back office?
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
6
Structures have Benefits & Challenges
Remote from business
Unresponsive and inflexible
No Business/ Operational control over costs
Viewed as central overhead
Prevalence of shadow operations
Centralized
Challenges Disparate
processes Multiple
standards Duplication
of effort Different
control environments
High cost and costs unclear across the business
Not scalable
Decentralized
Challenges Responsive
to Business and Operational needs
Business/ Operations control decisions
Customized solutions to meet Business/ Operational requirements
Benefits Shared Highly client
focused Commercially
driven Service
Partnership Agreements
Clear unit costs
Flexible delivery
Clear understanding of drivers and activities
Common systems and support
Consistent standards and controls
Tight control environment
Economies of scale
Benefits
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
7
Attribute Shared Services Centralization
Accountability Business Unit Corporate
Key Performance Target
Service excellence and continuous improvement
Cost reduction and central control
Service Partnership Agreements Widespread Rare
Classification An independent unit Another corporate function
Responsibility Partnership Demarcation
Shared Services vs. Centralization
North America | Latin America | Europe | Middle East | Asia-Pacific
Shared Services is the organization that…
Providing services that are…
Achieve by leveraging…
Employs a specialist
team
Geographically unconstrained
Client-focused
High quality Non-core Mission critical
Repetitive or
professionalLower costHigh
efficiency
Organizational
realignment
Technology
Standardization
Best Practices
8
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
9
Achieve the Triple Benefits of Shared Services
Higher Quality
Lower Costs
Improved Control
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
10
Trends in Shared Services
Shared Services Concept started in mid 1980’s. Concept initially driven by private sector multinationals Shared Services and Outsourcing initiatives typically result in "cost savings of 20%-50% on processes in scope” (Hfs-PWC report June 2011) "In today's business environment, nine out of every ten enterprises have shared services and 97 percent manage outsourcing relationships". (Hfs- PWC report June 2011) Mainly Finance driven early on in Europe/HR driven in North America Captive vs Outsource, On-shore vs Near-shore vs Off-shore Now much more end-to-end process focused Continued increase in scale and up the value chain in Shared Services (e.g. O2C, Reporting, Policy Very important now in the Public Sector – how to reduce deficits while not impacting front line services. Economic recession of 2008 has led to austerity agenda today in public sector: Shared Services is moving from opportunity to necessity
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
11
Trends in Shared Services (continued)
Technology options continue to grow (e.g. document management, approvals, user self service, ERP, “cloud computing”, etc) Politics around offshoring jobs has been an issue for years, but has not stopped the trend (captive and BPO), although slowed for a while Multi-functional Shared Services now really starting to happen after years of this being in the textbooks Large scale, multi-tower outsourcing not very common, despite what many predicted. Selective outsourcing (which actually never went away) is more the trend “Innovative outsourcing” has not yet happened. Lift and shift did. Partly due to client requirements. Across all industry sectors the trend is towards shared services, hybrid shared services organizations with some outsourcing, and multifunctional shared services
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Shared Services Examples in Public Sector
12
North America | Latin America | Europe | Middle East | Asia-Pacific
13
THE LESSONS LEARNED OF HIGHLY
EFFECTIVESHARED SERVICES
7
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
14
Lesson Learned 1What’s in a Name?
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
15
Lesson Learned 2Always File a
Flight Plan
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Business Case Activities & Deliverables
16
AS-IS
Carry out multiple site visits and workshops
Review and catalogue any existing process & sub
processes
Review a catalogue technology landscape
Complete Activity based Analysis
Finalise stakeholders interviews
Review existing reporting tools and mechanisms2 to 4 weeks
Current State Analysis:
Summary of Key Findings & Gap Analysis
Proposed
Complete best Practice diagnostics
High level process design
High level org design
Service delivery framework
Define high level KPIs and Metrics
Develop high level operating model
Finalise Technology assessment 4 to 5 weeks
Operating Model : To Be Processes &
Organisational Design
DESIGN, BUSINESS
CASE, RECOMMENDA
TION
5 to 6 weeks
Opportunity Matrix
Business Case Evaluation
Location Recommendations(s)
Recommend Governance Framework
Implementation Plan
Change management Plan
Identification of next steps
Recommendation, Business Case
& Implementation
Plan
Checkpoints with key stakeholders:
Project Board Steering GroupK
ey
Delivera
ble
s
BASELINE & BENCHMARK
Project kick off & mobilisation
Establish detailed plan, timelines, key
deliverables etc. for this stage
Review output from work to date
Initial Communications
Review and update baseline Calculations
Complete Further Stakeholder interviews
Key A
cti
vit
ies
Work
ste
p
0 to 2 weeks
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Sample Leading Practices DiagnosticAccounts Payable
As-Is (4.0)Considered finance function, not part of procurementManual invoicesAll payments in through single SAP ERPAccounts payable responsibility centralizedWeekly cheque runs plus ad hocNo statistical review of small invoicesManual cheques infrequentAchieve 50% of available vendor discountsEFT not used
To-Be (8.0)Achieve leading practices except:
Continue with manual invoices (initially no funding for document management/scanning solution)EFT only possible for 30% of vendors
Is part of an end-to-end purchase-to-pay process with front end transactional processes designed to minimize own stream error correctionScan and route 100% of invoices when received by accounts payable processing centerProcess all payments through a single system.Centralized accounts payable responsibilities across the organizationOptimize number of check runs each month.Review 100% of large dollar invoices and statistically sample the remainderEliminate manual cheque request generation.Maximize vendor discountsUtilize EFT for payment to eliminate use of paper cheques
0 4 102 6 8Diagnostic Rating Scale:• 1 = Leading Practice is not adopted• 10 = Leading Practice is adopted in full
Score in Range 1-4
Score in Range 5-7
Score in Range 8-10
Current Future
Leading PracticeObservations
17
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
18
Lesson Learned 3Don’t Leave
the Customer Behind
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
19
9 Elements of Customer Interaction FrameworkAccount Management• CSO to client; via reporting,
interaction, escalation & communication
Client Contact Management• Client to CSO; to manage
and resolve queries and drive learning/improvement
Service Partnership Agreements• SPAs are 2-way agreements
clarifying both CSO services and client inputs
Client Feedback
• Client satisfaction continuously monitored both informally and formally
Continuous Improvement• Mechanisms to identify the
areas for improvement and to develop solutions
Process Control Database• Documents end-to-end CSO
processes; highlights activity of both CSO & client
Performance Measurement• Comprehensive KPIs,
measures and metrics framework, CSO & client
Performance Reporting• Process performance will be
reviewed monthly by CSO and client
Recharging Methodology• Define basis for charging for
CSO services to turn consumers into clients
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
20
Lesson Learned 4Teams Need Air Cover
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
21
Lesson Learned 5Houses Start with
a Foundation
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
22
Activity ClassificationType of Activity Characteristics Examples
Transactional & Administrative
• Results more quantifiable• Processes benefit greatly from standardization,
automation and technology• Clear linkage between effort and results
(outputs generally experienced in short-term)• Generally not client-facing
• Accounts payable• Payroll• IT service desk• Fleet management• Facilities management• Mailroom
Professional & Technical
• Results are more qualitative• Standardization, automation and technology
have less of an impact• Relationship between effort and results is not
as clear (medium-term perspective)• Generally requires interaction with client
• Procurement advisory• Recruiting/staffing• IT applications• Health & safety• Space planning• End user training
Policy & Strategic
• Distant relationship between effort and results (long-term perspective)
• Standardization, automation and technology are not significant factors
• Clear linkage to strategic goals of organization
• Signing authority policy
• Business & strategic planning
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
23
Lesson Learned 6Structure for Success
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
24
Lesson Learned 7Transformation Takes a Team
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
25
Chazey Profile
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Chazey Partners’ Profile • Who We AreWe provide advice, guidance, support and implementation expertise, covering strategy setting, business case production, program management, outsourcing assessment, process optimization, technology enablement, training and change management.
Our functional breadth of experience includes the “big four” of HR, Finance, IT and Procurement, plus other support services such as Facilities, Real Estate, Legal, Communications, etc.
Example clients include Coca Cola Hellenic, Coca Cola Enterprises, Government of New Brunswick, Agrium, May Gurney, Gilead Sciences, Interior Health, Northern Health, Lawrence Berkeley Laboratory, FormFactor, National University of Ireland, Bridgestone, Gerdau, and many others.
Because we are passionate business people and Shared Service practitioners, we care about your success and deliver solutions relevant to your organization.
26
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Chazey Partners’ Profile • Public Sector ExperienceWe have serviced a great variety of clients across many industries and countries, covering Shared Services and Outsourcing, Business Transformation and Technology Enablement.
Due to the unique nature of working within the Public Sector and with Non-Profits, we wanted to specifically highlight the following organizations and experience below:
New Brunswick Internal Services Agency, New Brunswick, CanadaLawrence Berkeley National Laboratory, Berkeley, CaliforniaInterior Health and Northern Health, British Columbia, CanadaStanford UniversityUniversity College Galway in Ireland, IrelandThe World Wildlife FundThe International BaccalaureateNational Health Services (NHS), UKHealth Service Executive (Ireland)Non-Departmental Public Bodies (NDPBs)Ministry of Defense (MOD)South Yuba River Citizens LeagueOutsourced Services to Local Authorities 27
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Chazey Partners’ Profile • Specific Relevant Speaking Experience
Phil Searle, Grant Farrell, Chas Moore and Janey Jux have chaired, arranged, presented at and facilitated workshops at a number of Public Sector Shared Services events, including the following:
• Shared Services in the Public Sector at the Queen Elizabeth II Conference Centre in London
• Chaired, presented at and help organize the Shared Services and Outsourcing Network‘s first North American Public Sector shared Services Conference, held in Chicago in November 2011
• Presented at and helped organize the Shared Services and Outsourcing Network’s second North American Public Sector Shared Services Conference, held in Chicago in November 2012
• Delivered a master class at the “Managing Change – Transforming the Public Sector” conference at the Barbican Centre, London 2011
• Chaired and presented at the 2012 “Power of Collaboration” conference for financial professionals in BC Healthcare at Vancouver, Canada
28
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Chazey Partners’ Profile • Specific Relevant ArticlesPublic Sector Shared Services and “Collaboration vs. Sharing”. Phil Searle, CEO Chazey Partners
What might be the Impact of the 2012 Presidential Election on Shared Services and Outsourcing in the US Public Sector? Phil Searle, CEO Chazey Partners
Are you getting the SPA treatment? Chas Moore, Managing Director, Canada
From front to back office. Grant Farrell, Managing Director, United States
Proactively managing your stakeholders. Janey Jux, Head of EMEA Public Sector Practice
Make or Buy Decision. Phil Searle, CEO Chazey Partners
What are Shared Services Best Practices? Phil Searle, CEO Chazey Partners
When is Shared Services not really Shared Services? Janey Jux, Head EMEA Public Sector Practice
Business Continuity Planning. Grant Farrell, Managing Director, United States
Client Relationship Management Framework. Grant Farrell, Managing Director, United States
Deploying Shared Services. Grant Farrell, Managing Director, United States
Developing the Business Case. Chas Moore, Managing Director, Canada
Shared Services Optimization. Phil Searle, CEO Chazey Partners
Technology Enablement. Grant Farrell, Managing Director, United States29
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Business Transformation
We help clients to transform their support functions to realise significant benefits (lower costs, optimised working capital and improved performance) through best practice process development and roll out of optimal organisation, support and delivery structures.
Functional scope covering Finance, HR, IT and Procurement
Identify and target opportunities, and produce powerful business cases to reflect the opportunity and gain organisational buy in
Implement and support approved transformation initiatives rapidly to drive maximum ROI
Effective acquisition integration and business divestitures
Powerful project and change management, focussing on delivery and outcomes
Chazey Partners’ Profile • What We Do
Shared Services
Planning for, resourcing and implementing global and regional Shared Service Organisations (SSOs) covering a wide ranges of functions and processes including offshore solutions
Turning round sub optimal or failing SSOs
Statutory and Fiscal compliance delivered by SSOs for multiple countries and legal jurisdictions
Independent of any outsourcing providers, we offer impartial sourcing advice and support covering both internal and external options, to ensure that the best solutions for your business are found
Training and development for Shared Service practitioners and Shared Service customers
Technology Enablement
Implement and optimise ERP and other technology enablement solutions to maximise return on investment and in quick time.
Focussing on needs and value to the business, we view technology as an enabler and not an end in itself.
Resource technology projects to enhance chance of success through an optimal mix of IT, Business Systems Analysts, Business Process Integration, Business Process Owners, and Users
State of the art additional technology enablement where required
Effective training and support
Experience includes SAP, Oracle, JD Edwards, BAAN, Siebel, Peoplesoft, COINS and many others
30
North America | Latin America | Europe | Middle East | Asia-PacificNorth America | Latin America | Europe | Middle East | Asia-Pacific
Your Speakers
Janet GarlandAssociate, Chazey Partners Canada
Mobile: 250-762-2501
Toll-Free: 1-855-5-SHARED
Chas MooreManaging Director, Chazey Partners Canada
Mobile: 250-469-4168
Toll-Free: 1-855-5-SHARED
Top Related