I found this article on the current state of Shared Services & BPO very interesting. While it talks about the fact that companies are still unsure about their strategies to employ SSCs (Shared Services Centers) and BPO, it is clearly a topic being highly debated. Some of the things I found interesting and validated by outside sources were:
1. Executive level support is still the critical factor for success. This was cited in front of the more obvious things like SLAs, contractual agreements, training, etc... were not sufficient by themselves to drive success.
2. The need to drive a corporate governance model in conjuction with SSCs and outsourcing was seen as critical. This must extend beyond just internal controls for Sarbanes-Oxley compliance. Basically, it's about having global visibility and control over multiple trading partners in the Financial Value Chain. (I wonder how this affects exisiting banking relationships?)
3. The portfolio approach is clearly where companies are headed - Using a combination of insourced SSCs, and outsourced BPO providers to get the job done. My personal opinion is that when it comes to cash flow processes, follow the old maxim - Control the strategic core, Contract out the context (non-core). So when it comes to A/R for excmaple, the high volume, low value transactions with the mom-and-pop customers should be outsourced while the key customer relationships can be closely held within the company. I'll have some facts and figures around this approach in a future post
4. Finally, the need for disparate system integration is clear: The top three challenges to making a global shared services approach work in the real world from a technology perspective were managing ERP systems (34.6%), knowledge management (28.8%) and workflow and imaging tools (28.8%)
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