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7 Myths Challenging Shared Services Adoption

7 Myths Challenging Shared Services Adoption

Many enterprises are hesitant to invest in shared services due to fear of vendor lock-in, an aversion to “outsourcing,” or just a lack of information

Sharing services provides an opportunity to better leverage talent by relieving knowledge workers and core staff from having to perform mundane

In an increasingly uncertain marketplace, enterprises are primarily looking to optimize their costs and ensure future-readiness through operational flexibility and agility

Over the past decade, the role of shared services has evolved significantly. Shared services centers (SSCs), previously dedicated to performing specific, mundane tasks, have transformed into integrated, operational hubs with immense potential for back office automation, intelligent decision-making, and cost optimization.

In fact, a study conducted by McKinsey suggests that companies can save time and money, and see a 50% increase in back office efficiency, by leveraging the power of digitized shared services.

But, if shared services hold so much value in the digital world, why aren’t more enterprises adopting shared services?

The Common Myths Surrounding Shared Services

Despite the purported benefits, many enterprises are hesitant to invest in shared services for a variety of reasons: fear of vendor lock-in, an aversion to “outsourcing,” or just a lack of information. Besides, there are many misconceptions surrounding shared services that often deter enterprises from getting on board. Here are seven of the common myths:

Shared Services Is The Same As Outsourcing

In actuality, shared services are in-house capability centers that offer enterprises more control and the ability to intelligently automate numerous processes

Shared Services Lead To A Loss Of Control

On the contrary, enterprises that leverage shared services have more control over their processes and outcomes, and can easily modify their shared services operations to address dynamic business needs

Shared Services Do Not Provide A Return On Investment

However, a Global Shared Services survey, conducted by Deloitte in 2019, found that cost efficiency and increased business value were the top priorities for shared services investments. Furthermore, 80% of survey respondents were able to recover their initial investment within three years of a significant SSC implementation

Shared Services Is The Same As Centralisation

SSCs do act as a central hub for coordinating backend processes, but are inherently geared toward maintaining partnerships across disparate departments, external providers, third-party resources, and customers. This model helps to promote innovation, optimise costs, and improve staff utilization across an enterprise

Shared Services Are Not Secure

Modern SSCs rely on several new-age technologies to ensure data security and continuous compliance with regulatory requirements. In fact, investing in an in-house process center can actually increase security, as enterprises can retain more control and visibility across their operations

Adopting Shared Services Creates Unhappy Employees

Sharing services provides an opportunity to better leverage talent by relieving knowledge workers and core staff from having to perform mundane, repetitive tasks. Instead, employees’ talents and resources can be maximized to improve business outcomes

Sharing Services Cannot Effectively Address Dynamic Or Unique Needs

SSCs function as a flexible, long-term solution for the delivery of non-core, administrative, and customer-centric activities. The goal of shared services is to balance the need for standardization and process efficiency with the desire for process agility and scalability

Looking To The Future

In an increasingly uncertain marketplace, enterprises are primarily looking to optimize their costs and ensure future-readiness through operational flexibility and agility. Shared services provide enterprises with the tools to streamline their processes and respond to dynamic changes and business needs by retaining in-house control. All the evidence points to the clear benefits of leveraging a digitized SSC to stay ahead of the curve, today and tomorrow.

Note: The views and opinions expressed are solely those of the author and does not necessarily reflect the views held by Inc42, its creators or employees. Inc42 is not responsible for the accuracy of any of the information supplied by guest bloggers.