The motivation for shared services as a way to improve efficiency and effectiveness in global organizations is not new, but governing an expanding shared service often proves to be a difficult undertaking.
Over time, as organizations grow and expand into new businesses and geographies, shared services can increase in size and complexity to a point where a line item on an expense report becomes an annual budget similar to a small business with no inward focus on processes, governance or reporting.
It doesn’t need to be this way. Shared service arrangements can be designed appropriately to become sustainable, scaling with the organization to support growth over time.
When a new shared service launches there are often few people involved so roles and governance-related policies are informal and the day-to-day administration is generally successful, because people just do whatever it takes to get the job done.
When the workload grows, particularly if it grows slowly over time, the natural focus is for the team to scale up to continue to meet operational demands, and put less emphasis on oversight and governance. This tends to work well as a few key resources / subject matter experts are able to fill in any gaps, ensuring the function continues to operate. But what results is increased risk through lack of documented processes, financial oversight, and general lack of clarity for all stakeholders.
It’s easier to end up in this situation than most people might think. It is not something that happens overnight, it creeps up slowly over time until either there’s a major issue, or the people that run it move on, taking all of the knowledge with them.
If you are in charge of a function like this there are a few structures you can put in place that will help keep you on track:
Doing this will increase oversight and ensure key gaps are filled. But to make sure you can sustain the improvements over time, you need to take a few additional steps.
Once you establish the appropriate structure, create a governance model to guarantee the improvements will be around for the long run.
For many people, these sorts of changes seem like overkill – overwhelming a simple function with unnecessary structure and oversight; but it can be as simple or complex as you need, depending on your particular situation.
During the implementation of improvements it is imperative that you have a dedicated team to manage the work and communicate with key stakeholders to keep the plan on track. Developing a culture of continuous improvement where oversight, process management and structure are recognized as important takes a long time. But with ongoing commitment you can set yourself up for success even when key resources move on.
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