- Why Shared Services Leaders Have Unparalleled Business Insights
5 Reasons Why Shared Services Leaders Have Unparalleled Business Insights
Many Shared Services Centres (SSCs) have accelerated digital transformation plans to support remote working, maximise efficiencies and deliver greater value to their enterprise during the pandemic.
The SSCs at the forefront of innovation are those that are spearheading the implementation of automation, data analytics, and the harmonisation of knowledge-based processes like statutory financial reporting and tax compliance to reduce compliance costs and risks.
Here are five reasons why leaders of shared services are being called on for strategic advice.
1. They have in-depth expertise on maximising efficiencies
Shared services leaders have unique expertise to offer at executive-level enterprise meetings. This includes business insights into potential decisions that would rely on the support of their units or the creation of new ones. Shared services leaders have an in-depth understanding of the capabilities, processes and resources that SSCs require to achieve optimal performance.
The value of shared services is increasingly being recognised by global organisations, as reflected by a 2020 survey of over 150 shared services and outsourcing providers in the Asia-Pacific. The Shared Services & Outsourcing Network’s (SSON’s) research identified that nearly one in three (31%) gained a more strategic role in impacting top-level business decisions as a result of the pandemic. This trend may continue as businesses increasingly rely on shared services to maximise efficiencies while operating in unpredictable market conditions.
Shared services leaders have a wealth of analytical insights that are leveraged by multinational corporations (MNCs) to inform organisational strategy and identify opportunities to optimise back-office operations. To influence enterprise strategy more effectively, shared services leaders now have more face-to-face time with senior stakeholders and inclusion in discussions over business-critical projects. This has led to greater recognition that shared services are a vital component of the MNC’s business operations, rather than simply devolved back-office functions.
Tip: Provide senior stakeholders with reports and data-driven recommendations on a regular basis. Highlight the ways in which shared services are innovating and adding value to the business. Identify opportunities to further optimise performance, such as through standardisation and automation. Once senior leadership identifies your untapped potential, your insights and expertise will be sought after as a valued business adviser.
2. They can identify growth opportunities
Too often, critical business decisions are made without consulting managers of business support departments on the potential merits and risks. One of the areas in which shared services leaders are playing an important role is in scoping and reviewing prospects for expanding the location and range of shared services.
According to SSON’s Asia-Pacific market survey, over one in five (21%) shared services providers added new service lines over the past year, while nearly three in ten (29%) extended their geographic services and/or end-to-end scope of work. This trend is expected to continue – the same survey found that three in five global MNCs (60%) planned to increase their geographic reach and/or service offerings over the next year.
The centralisation and expansion of SSCs is not only taking place in the Asia-Pacific, but in other parts of the world such as Europe. An SSON report released in 2020 revealed the region’s then appetite for centralisation - a majority (56%) of businesses offered statutory reporting as a centralised service, while over one in ten businesses (15%) planned to centralise statutory reporting in the next two years.
Tip: Position yourself as an expert advisor to senior stakeholders on any growth plans for shared services. Draw on your insights and experiences to identify what is feasible under current capabilities, resources and processes, and what may be required to expand the scope and location of shared services within different timeframes. This will give you a strong footing to ensure that any metrics used to measure the success of new shared services are reasonable and achievable.
3. They are skilled at value optimisation
Shared services leaders who join top-level meetings at the enterprise level are gaining a better understanding of how senior leaders perceive their centre and the metrics that are used to assess value delivery. This information is being leveraged by shared services leaders to measure and optimise the value of individual business units and ensure they align with expectations. Going beyond traditional finance activities, shared services leaders are leveraging automation, digitisation and data analytics to drive value for their organisations.
Tip: Ask to be included in business-critical discussions at senior stakeholder level, advocating your ability to better deliver value through strategic leadership and organisational transformation. For example, you could use your influence at top-level enterprise meetings to ensure the organisation invests in technology that optimises costs and performance. The successful deployment of these tools may enable you to reassign your talent to higher-value work that delivers greater business impact. This could, in turn, stimulate the transformation of shared services into centres that drive growth by identifying opportunities for innovation, differentiation and expansion.
4. Driving digital transformation is second nature to them
Technology is set to have a great impact on the performance of shared services providers. However, success is not guaranteed and largely relies on selecting a solution that aligns with current business operations and future requirements.
Shared services leaders are well positioned to advise on the selection of technological tools that will enable their teams to deliver more complex, varied and knowledge-based services. As they are held accountable for any failure to deliver value in line with a vendor’s promised results, it is critical that decision-making authority on important technological investments are placed with shared services leaders.
The pandemic has led to nearly half (48%) of shared services providers in the Asia-Pacific region taking on a bigger role in driving digital transformation across the enterprise. The research also found that over three in five (61%) accelerated automation initiatives due to the pandemic.
Tip: With automation expected to have a transformative effect on the way that SSCs do business, it is critical that you have oversight of decisions relating to the selection and deployment of those content-driven tools for knowledge-based processes like statutory financial reporting and tax compliance to ensure they deliver results. Before the vendor selection process begins, identify your key considerations relating to the functionality, efficacy and rollout of a technological solution. Ensure your requirements are considered in early discussions with vendors to screen out unsuitable software.
5. They lead process harmonisation initiatives
Investing in technology with state-of-the-art process automation tools is only one part of the equation for success. The other is mapping, standardising and scaling processes to optimise results. The key challenge lies in breaking down data silos across departments and offices to deliver fully integrated, synchronised and standardised end-to-end processes.
A 2021 SSON survey identified that the top statutory accounting priorities of global MNCs relate to strengthening regulatory compliance and reporting. A greater use of automation and data analytics in shared services will play an important role in achieving that objective.
Tip: As a shared services leader, you will invariably have an in-depth understanding of any internal issues that may hinder the successful deployment of new technology, such as software that can standardise, centralise and scale global statutory financial reporting and tax compliance processes. By leveraging your inside knowledge of departmental silos, power struggles, disparate workflows and differing reporting processes, you will be better able to address potential obstacles to successful implementation. This can, in turn, help to secure significant returns on investment from powerful new technology that can help organisations to reduce compliance risks, strengthen data transparency and prepare for the future of work.
Shared services leaders are providing fresh perspectives on strategic initiatives at enterprise level and highlighting opportunities for innovation as they move up the value curve.
A rising number of shared services organisations are deploying digital tools to automate and streamline processes. These initiatives are leading to a refocusing of workforce and leadership efforts on providing significantly more complex, knowledge-based and value-added services.
With technology driving a revolution in shared services, these traditional cost centres are increasingly being recognised for the value-added services they offer to MNCs.
Statutory Reporting Proposition Lead, Asia & Emerging Markets, Thomson Reuters
Sakshi has over a decade of professional experience in the tax and tax technology industry. She works closely with Shared Service Centres and multinational customers propelling their adoption of technology to meet global tax and financial reporting requirements. She is a Chartered Accountant from the Institute of Chartered Accountants of India.