Shared Services Agreements

A broad cultural and process transformation can be a key part of the transition to shared services, including layoffs and changes in work practices. It is argued that transformation often leads to a better quality of working life for workers, although there are few case studies to support this situation. Don`t reinvent the wheel by writing your chord. Use existing models when designing your contract. There are many options that you can use for your common services agreement. There are reports of common service centres to the UK government that have not achieved savings, such as the Department of Transport project, which Parliament`s Public Finance Committee describes as „great incompetence“. [11] Common services are the provision of a service by a part of an organization or group in which that service was previously found, in more than part of the organization or group. Thus, the financing and replenishment of the service is shared and the supply service effectively becomes an internal service provider. The key here is the idea of „dividing“ within an organization or group. This authorization must, in principle, include collective responsibility for the results by the unit from which the work is migrated to the supplier. On the other hand, the supplier must ensure that the agreed results are provided on the basis of defined measures (KPIS, costs, quality, etc.). Common services are similar to collaboration between different organizations, such as a hospital trust or a police force.

Neighbouring trusts can, for example. B, decide to work together by merging their HR or IT functions. The public sector has recognized the benefits of the private sector and continues to seek best practices. The United States and Australia have, among other things, had common services to the government since the late 1990s. However, the failures of these projects are increasingly revealed by the press[8] and by opposition politicians. [9] There are six main principles that guide your business in the process of implementing the Shared Services Agreement. Internal customers must then indicate their own service requirements. Suppliers must meet their requirements and suppliers will have their performance evaluated on the basis of easily measurable specific criteria. If properly executed, the shared services approach takes advantage of the benefits of centralization and combines it with decentralization. Traditionally, the development of a shared service organization (SSO) or shared service centre (SSC) within an organization is an attempt to reduce costs (often tempted by economies of scale), standardized processes (by centralization).

A baseline evaluation study by the Global Service Centre[6], conducted by the Shared Services and Outsourcing Network (SSON) and hackett Group, which surveyed more than 250 companies, showed that only about one-third of participants were able to achieve cost savings of 20% or more from their SSo. At NASA, the move to a shared services model in 2006 represents nearly $20 million in savings per year. In addition, NASA`s Shared Services Center is expected to save more than $200 million by the end of 2015, according to NASA`s Director of Service. [7] The British government, in a central quest for efficiency, which follows the Gershon`s assessment, is developing a comprehensive plan to realize the benefits of common services.