Centralization of services

Optimization and professionalization of administrative functions in the finance sector as well as in IT or HR have been the focus of many management teams for years.

Since the 1990s, outsourcing and shared services organizations in particular have been regarded as best practices and state-of-the-art.

Which promises should shared services and outsourcing fulfill? What is the difference between the two alternatives? What are the success factors? And finally the question of which processes and services are suitable for shared services?

High expectations

The core idea of Shared Services is the centralization of services to achieve economies of scale and learning curve effects and to bundle distributed know-how. In most cases, the expectation is that tasks could be performed faster and more efficiently by centralizing tasks in one location. If this location also moves eastwards, then one can also benefit from wage cost arbitrage. The quality effects from the bundling of know-how are readily accepted - but are usually not decisive in the considerations as long as succession issues do not become virulent for know-how carriers. Unfortunately, these effects are not - as Management-Talk likes to put it - low-hanging fruits, but hard work.

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Stephan Grunwald

Senior Partner

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Markus Noçon

Senior Partner

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