Introduction

Given the many changes the Shared Services & Outsourcing industry has experienced as technology
makes networked platforms accessible, data turns into insights, and services support global operations,
SSON recently canvassed its global membership to ask them how they were reacting. In this extensive
survey, weve unearthed investment and automation priorities, and identified how SSOs rate their impact
on the business.
This report was written and edited by:

Barbara Hodge

Rochelle Hood

Editor

Global Head of Communities and Process

Shared Services & Outsourcing Network

Shared Services & Outsourcing Network

SSON would like to thank everyone who

invested the time to share the details of their
business services strategies with us.

What do Shared Services Look Like Today?

An analysis of the organizational set up, sourcing model, and geographic reach of SSOs today.

What maturity are you currently at?

Solid percentage in the 1-3 year maturity category:
Lots of potential for growth
As SSON has been tracking the Shared Services sector for
nearly 20 years, its not surprising that about half of
respondents put themselves in the mature or greater than 5
years category. The second largest category came from the
new or just launched segment (1-3 years). The market still
has a lot of potential for growth, which, as is shown later, will
impact investment and technology decisions. Interesting to
note that 14% put themselves in the Planning and Launching
stage, meaning that nearly half of respondents are in the
growth and expansion phases.

Where are your Shared Services located?

North America and APAC most dominant
location Europe still strong
As the SSO model expands, North America and APAC
are still the most dominant locations for centers,
ahead of India, Central & Eastern Europe, and Western
Europe. Noteworthy that a quarter of our global
respondents run centers in Europe, offering clientproximity and the all-important language element to
the multi-cultural client base across that region.

Sourcing options broadening for nearshore delivery

The Middle East and Africa is emerging as an
opportunity to provide French, Italian and some
German services to Europe; as well as support growth
across Middle-East markets.

Which describes your SSO?

*
A third of SSOs operate in single-function

Multi-Function

The discussion at conferences and in online forums has been

all about the shift to multi-function for the past five years. This
is reflected by our data, with 60% of respondents defining
their SSOs as multi-functional (providing more than one
functional service), just over a third of which have also shifted
to a Global Business Services model (meaning global process

GBS: Multi-Function

ownership or accountability beyond regional/functional). The

increasingly holistic interpretation of the Shared Services
model is supported by growth of a move toward the GBS
model.

What it means
Whether GBS or not, we would expect to see the trend towards

Single Function

multi-functional centers increase, as companies roll additional

service lines into an established and proven model.

*10% Single Function moving to Multi-Function

* 8% GBS: Single Function

Expanding scope led by HR, Procurement

with customer facing services emerging
While F&A (Finance and Accounting)processes still outrank
other service lines, HR is notably catching up, and the
percentages of single vs. multi-functional SSCs listed here are
a good indication that we may see a continued expansion in
scope into non-F&A activity.

Tip: shift to revenue-generating processes

While the adoption of Procurement is no surprise, the
percentage listing Sales and Marketing, as well as Customer
Service, marks a positive step forwards in terms of SSOs
supporting revenue-generating processes. Similarly, Sales &
Marketing are emerging as service lines, reflecting more
interest in leveraging Shared Services for the customer facing
business processes, a trend we are also hearing more about
in discussions with practitioners.

Which services does your SSC provide?

43% of market continue to operate as a

Captive model
While BPO providers have geared themselves up to take on more work, theres a good chunk of the market that is holding out. The
question remains whether this segment will be persuaded by the increasingly flexible and attractive options promoted by providers
or whether their concerns around control and customer-centricity will keep them firmly in the captive camp. A relatively low
percentage of Shared Services are banking on outsourcing as their primary model.

Is Outsourcing Right for You?

The potential for SSOs to increase flexibility,
technical capabilities and scalability
through outsourcing is enormous. Political
decisions, as much as sourcing strategies
influenced by desire to maintain internal
control will weigh in on the final direction
this takes. The extent to which well see the
hybrid market come down on one side or
the other is challenging to forecast. The
survey represents a slower trend
embracing outsourcing more holistically,
with the focus still on piecemeal processes.

The Decision Around Location

Sourcing decisions take into account, skills base requirements, proximity of emerging customer markets,
language and time zone support not just pure labor arbitrage.

Overall Shared Services Framework

GBS Model - processes &
services are defined &
delivered globally

One SSO supporting

a single geographic
region

Multiple SSOs
supporting specific
geographical regions

Other

Theres a near even distribution between SSOs operating as single center supporting one region and those
operating in a Global Business Services model
Going global requires a significant transformation on the part of the organization. The complexities involved in
establishing global process owners as well as standardized services across business units/regions may be the
challenges facing SSOs looking toward the GBS model.

16% say they are planning to move why?

Latin America and Asia top new location list but dont overlook Europe
Where companies are planning to move into new locations (16% say they do), Latin
America and Asia top the destination list. However, Eastern Europe, the US, India, and
UK/Ireland are also popular options. When combined with the responses to previous
questions this offers the clearest indication yet that organizations are strategically driving
expansion into emerging, or growth, markets through Shared Services, which has proven

Labor arbitrage
opportunities

its value in existing markets. Expansion is driven predominantly by language

requirements and labor arbitrage, as well as the need to support businesses in growth
markets. The uptick in interest in nearshore locations reflects the preference for
customer proximity that many organizations are banking on to improve their position in
already established markets.

Location decisions support growth

What stands out here is the fact that, as organizations are emerging from the postcrisis markets and looking to make up lost ground in the emerging and growth
markets of Eastern Europe, Latin America, and the Far East, they are increasingly
setting up centers in those regions to support this expansion. We can expect to see
more of this trend, before it is followed by a consolidation, whether towards regional
hubs, or into Global Services Centers.

Language Support

Shared Services Impact on

Organizational Performance
Shared Services impacts the business by saving on cost, supporting customer needs, and offering flexible
resources or scalability. Increasingly the model is also recognized for its potential impact on revenue growth..

We asked what their best metric was

Most important impact: the customer
To get a better idea of achievements, we asked respondents to list the result or metric they felt best represented their impact
on the business. Answers varied but most focused on increases in customer satisfaction and cost savings (eg: reduction in
finance cost as a percentage of revenue from 1.2% to 0.85%; another quoted a 40% reduction in overall finance costs). Some
cited large offshore footprints, some AP metrics, and others referenced Awards won. Process improvement rollouts, resource
sharing, high utilization rates, documentation, increased capability with no increase in headcount, and impact on bottom line
revenue were also listed.

What this means

Although metrics vary, what is impressive is that most respondents have one or more metrics to demonstrate direct
contribution to the business. Particularly of note are metrics like cost per customer cut 25%. A number cited pre-SSO vs. postimplementation results, proving the significance of setting an as is benchmark pre launch. If SSOs are to take on more
service lines, its imperative that they can reference, and prove, improvements that positively impact the business. One
respondee listed recruiting a high caliber team, and in doing so set the standard, as without the right skill set and
empowerment, it will be hard to push through the kind of change that will be required.

Shared Services continues to save on costs

and increasingly the model is recognized for its potential
impact on revenue growth
One of the most important questions regarding Shared Services is the extent to
which it delivers value beyond cost-cutting to improve overall business
performance, to pursue both bottom and top-line improvements. The survey
paints a clear picture of a maturing sector: a third consider cost cutting to be
table stakes with benefits already factored in. Today, there is increased
recognition of Shared Services as a means to strategically improve business
performance and drive value. A significant percentage see the model as a
catalyst for driving standardization and transformation at process level, and a
quarter are in transition, shifting from a cost-towards a revenue-focus.

Communication essential for engaging the business to share SS impact

The hook to being perceived as increasingly valuable to the business is to send
out the right message. A job well done is the best recommendation. So how do
SSOs communicate their achievements? About half do so monthly (or more
frequently), focusing on metrics/analytics to demonstrate their impact on
customers and stakeholders. Its encouraging to see 15% producing an annual
report on their operations. The opportunity to enhance monthly reporting lies in
creating insightful analytics beyond just actuals vs. goal.

What drives the SS value proposition?

Business results and customer satisfaction
The most significant impact on an SSOs value proposition is
contribution to business results and financials, followed by
customer satisfaction. Hitting KPIs is only moderately
important to driving value. The trend is therefore still firmly
pointed towards the bottom line.

How do you drive value?

SSOs are migrating beyond SLAs or KPIs as the only
measure of contribution, moving toward a focus on direct
contribution to business segment goals. Aligning to business
targets will be crucial going forward, as that is where Shared
Services can prove itself, and there are opportunities for the
model to expand its scope. Investment in client relationships
and process governance will further enable SSOs to remain
relevant and close to their customers to best understand the
opportunities to deliver increased value.

Cost reductions leads key contribution list

The million-dollar-question remains: what are SSOs
focusing on to drive improvements to the organization?
Rather conventionally, its in cost and process
streamlining. And although data based intelligence to
support decision-making is becoming more important, its
still not a leading factor.

Whats evolving as business contributors?

The means of continuously driving efficiency in and waste
out of a processes, including standardized reporting and
End-to-End streamlining, lend themselves to increased
contribution through full process ownership and control.

38% branded SSO with logo and unique identity

Shared Services strategic positioning can be measured by
the extent to which it promotes itself as a separate, valuedriving entity representing a unique brand. Just over a
third of SSOs are using this to their advantage, sporting an
independent tagline, logo and mission statement.

Why you should consider branding

Branding helps to shape the image of Shared Services as
a vital and necessary part of business operations. The
investments in design and logo are not significant
compared with the positive messaging and awareness it
brings. The survey confirms, however, brandings low
priority for Shared Services. To see a successful Shared
Services brand in action, look at leading SSOs like BPs or
P&Gs.

Process Improvement is a Priority

The majority of Shared Services are making innovation, or process improvement in support of innovative
business services, a priority. Process improvement allows cost to reduce while delivering a constant service. It
also drives additional value (eg through analytics) to the business via data based insights, or analyzing
business units service consumption patterns.

50% say process improvement is

responsibility for all
Whats encouraging is that process excellence has come out of the
toolbox and is now considered, by half of SSOs, to be part of
employees performance management objectives and measures. In
addition, over a third have established a dedicated Center of
Excellence team and deployed a process improvement/optimization
methodology.

An impressive 90% of SSOs have incorporated a process

improvement element
Although a third of respondents say they are still in the planning
stages, with limited results to date, the majority of SSOs confirm a
process improvement initiative underway, with results tracked. The
most significant evaluation levers are still cost and standardization,
as well as FTEs. Thus the opportunity to measure the less direct
benefits of Shared Services is being overlooked.

Which initiatives lead the SSO process

transformation change list?

Respondents have implemented an impressive list of process transformation projects. The achievements came in many different forms and types of
complexities. Here are some highlights of the significant initiatives implemented:

Evolving an existing in-country center to a regional center, covering 15 markets

Developing a global HRIS system

Centralizing Finance transaction processing

End to end process reengineering (O2C, P2P and R2R) for 2 major acquisitions prior to their integration into the SSO organization

Pulling administrative/support functions out of Sales so they can focus on selling

Multiple Lean events reducing waste and improving productivity

Defining & implementing O2C Global Process Model

HR reporting to business managers directly through self service

Organizational change from functional management to process management

Consolidation of routine HR services into a Contact centre service delivery business model

Service Line transformation from vertical distributed processes to end to end horizontal process reengineering with better ownership, measures and
customer involvement

Tip: invest in process as a productivity enabler

The advancement and impact of the SSO model can most greatly be realized through the economies and scale and transparency of gaps that can be
learned through full end-to-end process ownership. Shared Services can continuously increase the value they deliver by enabling productivity, both inside
the SSO and to the end customers absorbing the SSO processes.
.

Talent Management is Core

Talent management is becoming increasingly important as the work taken on by Shared Services shifts
towards data analytics, advisory services, and process expertise thereby requiring a differentiated skill set
compared to the traditional, transaction-oriented role.

Describe the skills and professional

development of your SSO team
Knowledge management skills replacing expertise
An important trend is the shift towards an increased skills and
development focus around knowledge-based employees. A small but
significant, and encouraging, segment says that it is primarily
knowledge-based, with most transactional work outsourced. This
meshes well with the overall trend to offshoring (if not outsourcing)
of transactional work and an increased focus on customer-centric,
value-add, knowledge-oriented, analytical services.

What is the budget allocation for training

your SSC staff?
How can you support this transition?
This shift in skill set needs to be supported by
appropriate training, as a predominantly
transactional-oriented workforce will need help
transitioning to more challenging roles. The
majority of SSOs reported training budget of only
1-3% of the total SSO budget. Carefully
architecting a change management plan to outline
the talent transition will help to ensure you have
the right talent with the right fit for the work.
.

Is attrition causing knowledge loss?

Not necessarily. Although we do tend to hear more about attrition in emerging markets, where increased competition in lowwage environments is producing something of a feeding frenzy, a significant proportion of respondents say that staff leaving the
SSO tend to move into the business units thereby taking with them a valuable understanding of services delivery, and
hopefully putting this knowledge to good effect in their new positions.

SSO as a talent incubator for other companies

One interesting result to examine is the 28% of respondents that indicated their SSO attrition is due to employees exiting to external
companies, in non-SSO roles. This turnover could be indicative of the perception of limited career opportunities in Shared Services.
Another contributing factor may be the change in the work performed in Shared Services moving to higher skilled, knowledge based
employees.
.

Data Analytics and Business Intelligence (BI)

Shared Services are well-situated to take on the role of mining, sorting, and analyzing data to deliver the
business insights and intelligence that a company needs to make better decisions in future.

75% say business intelligence activities

are ramped up
With the shift to knowledge management highlighted
above, and more and more talk around data analytics
and business intelligence, the question is to what
extent organizations have followed this up by
establishing Business Intelligence teams. While just
10% have a mature policy in place and routinely
utilize BI data for insights and decision making, three
quarters of SSOs are in the planning or initiating
phases of their BI implementations. Where is BI being
initiated, in half the cases its being driven from within
Shared Services.

What level of maturity is your Business

Intelligence strategy at?
Despite the investments on the part of BPO providers
in data analytics and insights, only 5% of SSOs have
resorted to accessing this expertise through
outsourcing BI. Even where hybrid models exist, only a
small segment is leveraging providers for BI again
surprising, considering the importance commonly
attributed to data analytics.

Now is the time to build up your BI team

The most significant factor driving BIs value proposition is
the ability to provide better insights to enhance business
results, and help prioritize decisions around cost and
smarter decision-making. Despite the perceived difficulty
of mining and analyzing data (see below), three-quarters
of SSOs are investing in a BI initiative to support improved
performance via insights. To the 20% for whom BI is not
yet a priority: dont risk getting left behind.

45% drive business insights

through internal process data
Process data is rich with information that can be
turned into insights to enable business decisions.
Shared Services owns and manages an immense
magnitude of data from which vital insights can be
learned. Some of those who have implemented BI are
using the intelligence gleaned to evaluate current
performance vs. benchmarking data using it as a
basis for improvement. Outsourcing is still, in line with
other comments, underutilized for BI capabilities with
only a small sector leveraging BPOs for this skill.
.

The Challenge: Accessing Data

Data is the foundation and driving of any effective
business intelligence tool and the resulting insights
that can be learned. Just over a third of the
responded indicated accessing data from disparate
systems is the principal challenge to developing their
analytics capability. Another challenge is insufficient
resources. Crucially, SSOs should be looking not just
at internal processes but also, and perhaps more
persuasively, at external customer data. Revenue will
generally outshine cost as an argument.

48% of SSOs in Master Data Management

planning and data source id stage
While discussions around data have been leading online
forums for years, many SSOs are just beginning to tackle the
challenges and put a MDM plan in place Just over 10% have
a mature MDM model including governance structure, data
cleansing strategy and a MDM roadmap. A large segment,
however, is in the process of locating sources and identifying
gaps and solutions.

Its not really an option

Getting your master data in order is not a nice to have its
a need to have. With all the data passing through SSO
processes mining, cleansing, and analyzing is likely to become
an increased priority. Given the increased reliance on data
analytics, the question lies in whether business leaders will
prioritize investment in solutions to remove the barriers in
order to unleash the power of the data to enable business
decisions.
.

How is Shared Services leveraging industry

specific expertise?
Given process standardization, value is now driven by the kinds of differentiated services that set individual
industries apart, for example relating to regulation, or employment.

Nearly 50% of SSOs have Industry

Specialized Centers of Expertise
The smart money these days for captives as well as
providers is on developing industry-specific process
expertise in support of services provided. Nearly half of
SSOs are developing, or have already developed, an inhouse Center of Excellence (COE). A small, but presumably
growing, segment is collaborating with BPO providers to
access this expertise.
This seems to spotlight an opportunity that the BPO
providers have been hoping for. Although a surprisingly
large number of practitioners have not yet created a plan
to develop industry specific knowledge, a majority say they
would be likely to utilize a third party provider if they were
able to demonstrate this industry expertise.

BPOs plugging the gap: should you rethink?

Perhaps you should. BPO providers have long been
developing process expertise across industries like
Financial Services and Media. This can translate into
significant differentiators against competitors. Leveraging
industry expertise and enabling technologies from Third
Party providers can enhance regulatory controls, increase
audit readiness and better equip teams to define and
document business requirements for projects and
systems.

What are Technology Priorities?

Enterprise platforms make it easier for Shared Services to operate but it is in the emergence of enabling
technologies and cloud-based solutions that we are seeing quantum leaps. Add to the mix the shift to digital
business and mobile applications where do you stand?

SharePoint has strong deployment with all

regions > 70%
SharePoint is the most common enabling
technology with greater than 70% deployment
globally. Better than 50% of those surveyed utilize
Workflow Management software and most regions
report 50% or better implementation of Document
Imaging. Limited SSO populations have begun the
use of collaborative software or social communities.
SharePoint enables collaboration, data storage,
access and increased user control with less reliance
on IT for document management.

What are your technology investment

priorities?
With regards to future investment priorities, the main targets
are automation for efficiency, internal collaboration and
paperless processes. These enabling technologies are
foundational capabilities needed to transition to Global
Business Services and more effectively attain full end-to-end
process ownership.

Smaller than expected planned investment in Social Media

technology
Social media lags notably, with most respondents (about
60%) saying they have limited or no use. Even with new
technology plans, social media requirements or applications
are notably absent. The question lies in whether social
media is a fit for Shared Services or only in the external
facing applications and processes supported by the SSOs.

Cloud still rates highly

Unsurprisingly, cloud based technologies are strongly present
at least by a large segment of respondents who cite their
ability to enhance flexibility and reduce cost. Close to 30% of
respondents make use of the cloud to increase governance and
audit controls.

Mobility is prioritized
Mobility is now recognized as a priority when developing
business requirements for new technology and solution
implementations. Mobile apps are increasingly becoming
mainstream for external facing applications.

Customer Considerations
Now that Shared Services has cut costs and established robust processes, the focus is on providing the kind
of support that positively impacts customer experience.

Shared Services aligns with

strategic goals of the company
Strategic goals and objectives of the organization and Clevel management mandates rank as the two most
significant drivers of Shared Services strategy. Business
unit customers requirements were rated closely behind as
a key input to shared services strategy. Shared Services
teams are continuously challenged to stay close to the
business to best understand their needs and how to
contribute to their key objectives

With customer requirements changing at a rapid pace, how does

the SSO stay on top of customer needs? More than 45% of
respondents have invoked a formal governance board comprised
of both business segment/stakeholders and SSO leaders.
Nearly a third of SSOs have no defined process for tracking and
managing changes which adds risk to the controlling the gap
between customer expectations and Shared Services priorities.

Change Management starts with communication and solid

governance
Facilitating channels of communication demonstrates investment
in the customer relationship and helps to surface issues and
concerns before they grow. Differences between expectations
and shared services focus can be remedied more quickly with
defined checkpoints and change reviews. Governance boards
also lend themselves to both organizations, Shared Services and
business leaders, having a clearer understanding on the impacts
of any known or planned changes. Demonstrating flexibility to
adapting to changes on the business units side also increases
the value of shared services.

The Future
Nothing stands still. We are in the midst of economic, operational, and technological changes that are shifting
businesses priorities. And the Shared Services center is a core facilitator of this change. How are you tackling
the challenge?

Two Definite Trends

So, how does all this leave Shared Services positioned for the
future? Two definite trends emerge: first, is the unquestionable
shift to GBS, to drive a more unified, data-oriented, support
service with global process ownership through the enterprise;
and second, is to leverage SSOs achievements in the back
office by incorporating customer facing processes like sales and
marketing, thereby shifting the focus to revenue generating
services.
While lights out and outsourcing are also noted as goals,
developing a global framework, and successfully engaging the
customer, will mark this sector in the medium term. In terms of
concrete plans, most practitioners say they will develop their
operations through expansion in scope of services, supporting
new regions, or gaining ownership of more end-to-end
processes. A small percentage plans to expand outsourcing
arrangements and reduce captive FTEs.
.

Take every opportunity to promote benefits

beyond cost
Enabling the business to focus on core functions leads as the
greatest added value Shared Services contributes to its organization
followed closely by taking costs out of functional service delivery.
While most shared services were launched with these goals in mind,
new opportunities are emerging for value contributors. Enabling
enterprise-wide business decisions through analytics and insight and
providing the flexibility needed to engage new markets or launch new
products are two areas ripe with potential for key value drivers.
SSO leaders can target untapped potential in terms of data analytics,
business intelligence, enabling technologies, and deeper engagement
with customers to broaden impact and increase status as a preferred
provider and valued partner to the business.

How will Shared Services Grow?

We asked SSON members to look into their crystal ball and
predict the growth potential for the Shared Services model.
Most leaders see the greatest expansion coming from supporting
new regions or attaining ownership of full end-to-end processes.
The great news is the model is healthy and full of room to
increase services.

Relationships with
Outsourcers remain
focused on cost
reduction and process
efficiency
More than 40% of respondents, indicated the outsourcing
will remain as is, with service providers being handed
transactional pieces of processes to manage costs and
drive efficiency. Increasingly outsourcers have been able
to offer a seamless partnership effectively acting as
rebadged staff. More than one third of the respondents
now trust their outsourcers to handle more industry
specific processes and front-office activities.

Solutions for the future

SSO leaders are used to being pitched on the latest incarnation of any
number of solutions and technologies. We wanted to know where they
thought the most significant innovations were happening and what was
top of their purchasing list.

Cloud technology as a tool for analytics, data insights, management

reporting, and to add flexibility to supporting shifting trends in the
business ranked at the top of the list across all regions. Mobility for eCommerce, recruitment and more timely transparency to process
results was also noted in several surveyed regions.

Procure to Pay technologies, including e-Invoicing, Vendor Portal, Global

Procurement tools, EDI, and end-to-end process automation where
highlighted by significant number of the responses. Another
noteworthy element of future solutions is the increased need for
collaboration and information solutions, even as simple as instant
messaging, to connect shared services professionals to their peers
around the globe and the stakeholders they serve.

Note: Demographics of Respondents

While survey respondents represented a broad variety of industries including Public Sector, Life Sciences/Healthcare,
Technology and Telecommunication and Retail. The largest segment came from Manufacturing and Banking & Financial
Services. These industries have been early adopters of the shared services model and many also have a focus on defect
reduction, waste removal and quality outputs. Quality assurance, continuous improvement and process control focus are well
paired with the Shared Services model. A keen demographic to note is the strong increase of Public Sector Shared Services in
Australia.
To provide some perspective on demographics, we asked respondents to identify which function they represented. Finance &
Accounting is the function with the greatest representation. HR, including Talent Management, Recruitment, Learning and
Development, represented with the second largest population. Multi-function centers and roles ranked as third in the
demographic data.

About SSON
The Shared Services & Outsourcing Network (SSON) is the largest and most established community of shared services and
outsourcing professionals, with over 78,000 members globally. We provide the roof under which key industry experts and
organisations share their experience, knowledge and tools, and SSO practitioners connect with others all over the world, face to
face and online.
SSON focuses on developing its members through providing training, content, tools, and networking opportunities. Our staff
members work from international offices in New York, London, Singapore, Sydney, Johannesburg, Berlin, Brazil and Dubai to
research current trends and developments in shared services.
You can access complimentary access to exclusive interviews, industry reports, survey results, webinars and whitepapers and
more. To join for free, visit www.ssonetwork.com.

Unlock Value, Improve Productivity and Maintain

Your Competitive Edge by Attending:

19 20 August 2015, Manila

Featuring a line up of 20+ speakers with combined experience of more than 200
years in delivering shared services across the region and the globe, you will discover
and take away practical techniques to apply and improve service delivery.

Click Here to Download Agenda