Shared Services Leaders share Best Practices

I was fortunate to be invited to speak last week at the European Summit for Leaders in Shared Services. Speakers included Shared Services leaders from organisations including Siemens, Coca Cola Hellenic, BP, Robert McBride, COLT Services, Rolls Royce, Shell, Hertz, Balfour Beatty and Novartis. It was an excellent 2 day event in central London and about 80 delegates joined for a genuinely interactive and collaborative forum.

Like you, I'm sure, I attend a number of conferences every year and my experience is typically that there is 20% of the conference which has real value, but you have no way of identifying which 20% at the outset!

As it turned out the event was vibrant with real experiences and best practices shared. There was no difficulty staying alert, even at the 'graveyard slot' after lunch. Much of this was to do with the quality of the speakers, and the interaction and group discussions stimulated by the Chair, Susie West of sharedserviceslink.com. From the start, the conference dynamic was stimulated by mandatory vigorous 1-1 table discussion on key challenges and improvement areas.

There had been a survey of the delegates prior to attending and 49% had been running Shared Services for 3 years or more, some for more than 10 years and a number of organisations were going through the initial transition.

Although the vast majority were running finance & accounting shared services, the biggest segment being Purchase to Pay/Accounts Payable, 51% are actively bringing in new functions to the Shared Services environment.

Second only to stabilising current operations, the biggest inhibitor to expanding Shared Services was identified as process variance, which was particularly interesting to me as it was topic of my talk on the first afternoon.

The FIVE BIG themes of the conference turned out to be these;

1 - Service vs Process

Michel de Zeeuw, CEO Global Shared Services at Siemens, shared strategy and performance themes for his mature multi-function SSO, serving the diverse businesses of the corporation. Michel shared his focus on 'Service' lines and management for his customers and the difference in focus between that and a 'process' orientation. It was food for thought, although this SSO looks a lot like a mature business in its own right, almost operating as an external service provider.

2 - Customer Satisfaction

Only 9% of the attendees rated excellent customer satisfaction (in the survey mentioned above), although  customer satisfaction is regarded as critical to the ambition to grow the scope of the SSO. Various 'people' related strategies were shared on this, not least the hiring of 'sales/marketing' oriented 'relationship managers'. One of the great insights that came from one of the interactive group 'workshop' discussions was that 'customer satisfaction' may not be the best way of thinking for a captive Shared Services organisation. As George Connell of Shell shared with us, these operational processes are integral to the business processes, not an external 'black box'. I plan a separate post on this, but it was quite a healthy discussion and we broke some new ground, I think.

3 - Process Standardisation

Everyone shared their own experiences on this and the challenges in trying to harmonise processes to drive best in class cost structures and standard services.Most interestingly, one of the survey results was the extremely high correlation between low process standardisation and poor customer satisfaction, although its seems evident that the relationship is not direct (perhaps the link is caused by a poor cost structure associated with poor standardisation). The biggest obstacle to growing the SSO was identified as 'Process Variation' at 90%. Continuous Improvement was a key topic in this them and over 50% of SSOs represented employ a 'Head of Continuous Improvement' role. My talk on this subject somewhat reprised my recent webcast on 'Driving Process Excellence in Shared Services' and the un-intended consequences of managing purely by lagging KPIs. You can see a review and the webcast here . . .

4 - Global Process Owners

Over 60% of SSOs who rated customer satisfaction at least as 'Good' employ Global Process Owners (GPOs) and the clear trend is to transition overall responsibility and authority for the process from regions to this person. This is clearly helping drive standardisation and continuous improvement. Purchase to Pay is clearly the most popular but we saw organisations driving this principle across all their processes for the SSO.

5 - Talent

This was a very strong them. There was much discussion about 'remediating' some of the 'old school' reputations for 'transactional' or 'back office' staff. Clearly driving customer satisfaction requires quality, motivated people with a career path. There was some discussion on 'exorcising' some of the more negative terms from management's vocabulary and ensuring that an effective HR intervention happens at all stages of SSO maturity. Developing talent and upskilling were seen as the most important strategic objective, especially among SSOs with good customer satisfaction scores.

Final Thoughts

As an aside, the issues of governance, control and compliance arose a number of times. It is my observation that one of the positive, but perhaps unintended consequences of the Shared Services journey is improved control and compliance. However, I was surprised to see that the number one response, at nearly 90%, to the question 'In the context of the SSO, what does delivering value mean to you?' was 'Control & Compliance'.

There was a lot to digest at the conference, which made this an excellent forum. I will be presenting at the US Summit for Leaders in Finance Shared Services in Chicago on 23-25th April. You can find out more here .

If this sounds interesting, comment to this post and I may even be able to get you a discount!

Thanks for reading . . . .