A shift from Shared Services Centres (SSC) to Global Business Services (GBS): Think Globally, Expand Rationally, Execute Strategically
Shared service centres (SSCs) were created with the objective of demonstrating and delivering business value to internal stakeholders in accounting, procurement and IT support etc. SSCs are a unique combination of people, processes, and technology that support enablement functions in:
- Consolidation and standardisation of high-volume activities; and
With the advent of automation and AI/ML technologies, SSCs have evolved to become a multifunctional organisation with a global focus. Its scope is not limited to provide transactional support but perform knowledge-intensive and highly sophisticated activities that add more value to the business. This shift has now taken the form of a Global Business Service (GBS), which involves full integration of business activities, and specifically focusing on end-to-end processes.
Moving towards a Transformative Age
According to Gartner, “Successful organisations take a long-term view of shared services from day one and establish policies and organisational structures for a global model.”
In the backdrop of geographical expansion and growing offerings portfolio, there has been a continuous increase in the number of companies adopting the GBS model. An SSON report suggests it has grown by 80% in the last few years. GBSs play a very critical role in:
- Optimising costs: GBSs not only enable streamlining of processes at a global level but do so cost-effectively. Owing to automation, scale and reduction in labour costs, GBSs benefit lean cost structures.
- Bringing internal flexibility: Although transactional processes still reign supreme, GBSs encompass the skills to provide complex services supported by digital solutions. It helps enablement functions both operationally and strategically.
- Driving digitalisation: GBSs can deploy standards across various facets of an organisation and enable companies to grow sustainably in the digital future. They do this by ensuring smooth adoption of emerging tech and end-to-end systems and processes.
- Creating superior and experiential customer journeys: GBSs can help organisations craft long-term engagement with customers, assist with excellent service delivery, and monitor customer satisfaction.
- Recognising the importance of human resources: GBSs enable restructuring the value of human capital by demarcating functions that can be achieved through automation to enhance focus on functions that require human intelligence. It creates room for organisations to invest in training and developing their people on the one hand and an opportunity for employees to learn new skills on the other.
Journey Towards GBS
Moving from a separate entity that controls local units towards a centralised and integrated, comprehensive global system has its complexities. The question of how to approach is a major issue since it can significantly influence the development of the future shared service organisation and its underlying service delivery model.
The digitalisation of processes and the movement towards GBS entails challenges in governance models and human resources in terms of the skills required from employees. Organisations need to factor, among others, the following while implementing transitioning into a GBS model.
- Time frames for the deployment of the model
- Assessment of how and when the organisation will be ready to adopt new technologies
- Assigning project leaders and departments to undertake the process
- Ability of the organisation to successfully implement the GBS model depending on its existing resources and know-how.
Most organisations consider engaging external services providers to undertake this transition smoothly, without affecting operations. In selecting a partner, organisations should consider certain premises, including client portfolios, experience, range of services provided and proposed methodology. Another factor to consider is the ability of the service provider to ensure agility and flexibility remain at the forefront of strategy implementation and enable the organisation to quickly adapt itself to new technologies and a rapidly changing project environment.
Needless to say, with globally standardised end-to-end processes and digitalisation, well-defined governance models, and a common advanced IT infrastructure, GBS can provide high-quality knowledge-based services with exceptional efficiency. In addition, a digitalised continuous improvement process makes it possible to identify and abolish inefficiencies and react to business changes in real-time.
Source: Gartner, PWC, Outsourcing Portal International, SSON