More Related Content Similar to Shared services workshop Similar to Shared services workshop (20) More from Inez Hofner (10) 3. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 2 21. Service Level Agreements are at the Core of Service Management Effective Service Management establishes an ongoing Operating Cycle for Shared Services to ensure that customer expectations are understood and managed through service delivery. 2 Performance Measurement Bi-Directional Process KPIs Service Level Agreement 1 3 Governance Decision-making, Escalation Service Definition Service Catalog, SLA The Shared Services Service Level Agreement is central to the relationship with each key customer. 4 Financial Model Chargeback Copyright © 2009 Accenture All Rights Reserved 4 25. Processes – The actions necessary to complete transactions based upon rules, requirements, and technologyChange Management, Training 5 Copyright © 2009 Accenture All Rights Reserved 26. Shared Services Performance Management Operational Cadence & Controls KPIs Reporting Copyright © 2009 Accenture All Rights Reserved 6 28. What is the typical scope of Shared Services activities? Other Record to Report Procure to Pay Technology Services Hire to Retire Order to Cash Fixed Assets Inbound Sales Vendor Data Management Strategic Workforce Planning Product Design Infrastructure Mgmt Outbound Sales Requisition & PO Processing Intercompany Accounting Staffing Services Manufacturing End User Support Order Management Supplier Scheduling Total Rewards Planning General Ledger Inventory Mgmt Infrastructure Development Collections Total Rewards Administration Receipt Processing Cost Accounting Warehousing Application Maintenance Customer Billing Accounts Payable External Reporting Distribution Application Dev & Implementation Time & Attendance Cash Application Travel & Expense Compliance Mgmt IT Business Planning Facility Mgmt Payroll Administration Sourcing Execution Cash Mgmt Planning & Performance Mgmt Enterprise Architecture Planning Real Estate Data Mgmt, Reporting, & Compliance Supplier Mgmt & Development Capital & Risk Mgmt Business Analysis Emerging Technologies Warranty Mgmt Workforce Dev Services Sourcing & Strategy Finance Function Mgmt Quality Assurance Marketing/Public Relations Organizational Effectiveness Services Compliance Mgmt Risk Mgmt Legal HR Function Mgmt Legend Procurement Function Mgmt IT Function Mgmt Internal Communications Typically in Shared Services Typically not in Shared Services Copyright © 2009 Accenture All Rights Reserved 8 59. What decisions do you have to make? The first phase of Shared Services must answer key questions to define the operating model and build a fact-based case for change What is the strategic intent of establishing shared services? Dramatically cut costs? Position for growth? Deliver better service? What is the right scope of the SSC? Which processes? Which operating organizations? How does shared services fit with the current initiatives currently underway? How will the initiatives be aligned? How many service centers are required? Where should they be located? What is the advantage of Greenfield vs. Brownfield? How should the change be managed to ensure that goals are achieved - securing buy-in and creating a new high performing operating model? What is the portfolio of initiatives required to implement shared services? How should they be prioritized? How should we organize the program? What service and economic benefits are feasible? What level of investment will be required? What are the key risks to be managed? 1. Strategic Intent 2. Scope of Shared Services 3. Fit with “Current Initiatives” 4. Shared Services Operating Model 5. ChangeManagementRequirements 6. Implementation Strategy 7. Cost/BenefitAssessment Copyright © 2009 Accenture All Rights Reserved 10 60. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 11 61. A Call to Action Institutionally-recognized compliance issues Cumbersome and inflexible financial reporting capabilities Multiple and diverse business models inherent in university settings Incomplete technology implementation and integration Complex processes and systems constrain ability to improve Confluence of growth and the retirement bubble poses a risk for business continuity Faculty and administration expect better service and say that there are gaps People-dependent processes make it difficult to scale to meet Yale’s anticipated growth Copyright © 2009 Accenture All Rights Reserved 12 74. Imagine 141 ‘divisions’ in 3 square miles… 8 21 12 14 6 5 4 4 6 5 5 7 4 4 4 17 4 5 4 4 4 10 5 7 7 6 12 5 6 10 19 14 6 6 4 6 10 Copyright © 2009 Accenture All Rights Reserved 14 75. Assessment Approach Assess Business Practices and Application Portfolio Define Target Operating Model Establish Administrative Services Vision Determine Business Case, Roadmap and Plan Engagement Fact Basis Copyright © 2009 Accenture All Rights Reserved 15 78. Business staff spend less time on administrative tasks, more time on forward-looking financial planning and analysis 85. Academic staff spend less time on administrative tasks, freeing up time for more grant development, research, and teaching 88. Increased and more efficient administrative capacity is essential for Yale’s plans for future growthCopyright © 2009 Accenture All Rights Reserved 16 16 16 90. Contact and Case Management – Process and applications focused on tracking and resolving service requests, supporting service providers and managers. 91. Knowledge Management – Process and applications for cataloging and presenting policy and procedures information to end-users and service providers, underlying case management and self-service capabilities. 92. Workforce Management – Processes and applications for managing staffing and productivity in a service center environment. 93. Quality Monitoring - Processes and technology for call monitoring, evaluation and quality improvement. 95. Operational Metrics – Performance metrics established to measure the efficiency and effectiveness of the service delivery model. 96. Continuous Improvement – Process cycle devoted to improving process, as informed by metrics and facilitated by proven analytical approaches.Contact Management Case Management Operational Metrics Continuous Improvement Self-Service Knowledge Management Call Center Telephony HR Shared Services POAP Shared Services Research Admin Shared Services IT Shared Services Other Shared Services Workforce Management Quality Monitoring Focus areas for Service Delivery Workstream Core Process Capabilities –Developed by Functional Workstreams Copyright © 2009 Accenture All Rights Reserved 17 115. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 21 124. AP vendor invoice processing costs: $29/invoiceCopyright © 2009 Accenture All Rights Reserved 22 125. Shared Services Operating Model Shared Services Customers Governance Policy Definition Issue Escalation Strategic Direction Reporting Structure Management Processes Relationship Management Service Management Performance Management Continuous Improvement Knowledge Management Employee Service Delivery Contact Center Inquiry Management Case Management Finance Operations Vendor Accounts Payable Travel & Expense Vendor Master & 1099 Processing Client & Process Integration Mobilization Integration Agency Support Functions Information Technology Facilities Training Fiscal Human Resources Communi-cations Copyright © 2009 Accenture All Rights Reserved 23 145. Governance Model Agency Partnership Governance Union Governance OSS Governance Council Leadership Responsibilities Focus on: Resources Buy-in Strategic direction Strategic Meet Bi-Annually Partnership Committee Responsibilities Focus on: Working with OSS management Resolving escalated issues Meet quarterly CFO Council Management Responsibilities Focus on: “How well” “What’s next” Meet Quarterly Responsibilities Focus on: Performance Management & Compensation Training/Development, Continuous Improvement Working Groups Working Groups Process Council Operations Responsibilities Focus on: Continuous improvement Operational performance Working Groups Operational Meet Monthly Meet Monthly Copyright © 2009 Accenture All Rights Reserved 25 146. Lessons Learned Strong sponsorship from central agencies and customer agencies Union partnership (e.g., self-directed work teams) Governance model (e.g., CFO council) Greenfield location – critical to building a new culture of working Performance driven operations (e.g., SLA’s linked to individual KPI’s) Process innovation (e.g., call center and transaction operations) Technology innovation (e.g., scanning, document management CTI) Copyright © 2009 Accenture All Rights Reserved 26 147. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 27 148. Marriott Business Services (MBS) Open in November 2000 Two-story building accommodates nearly 300 people Open office design to encourage teamwork, problem solving, and continuous process improvement Training center to facilitate associate development Copyright © 2009 Accenture All Rights Reserved 28 164. T&E processing & approvalShared Services Delivery Model Transactions that begin at the hotel or otherbusiness unit are completed by MBS. MBS functions as an extension of the client operation. Copyright © 2009 Accenture All Rights Reserved 29 167. Without a material change, Shared Services employees are still burdened by the culture around them 168. There is no concept of a performance driven mindset in a legacy organization 170. Even a passionate leader feels like giving upTurning a centralized organization into Shared Services takes time… …Pam Murray, Marriott Business Services Copyright © 2009 Accenture All Rights Reserved 30 171. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 31 202. Are all Shared Services Centers created equal? Based on independent research, there is a significant gap in performance between laggard and world-class Shared Services, but it is never too late to follow Shared Services practices that will have a material impact on cost and service performance. Laggards $9.60 Leaders $3.75 PTP: Cost per Invoice Performance Gap: 2.6 Times Leaders $156.60 Laggards $323.36 Payroll: Cost per Employee Paid Performance Gap: 2.1 Times Laggards $11.00 Leaders $4.76 Travel: Cost per Expense Report Source : Hackett Group Performance Gap: 2.3 Times Copyright © 2009 Accenture All Rights Reserved 33 211. Expected Shared Services Economics Typical net benefits for enterprise-wide processes range from 15-30%* (individual processes can realize higher savings) with a 2-4 year payback. Payback Period Net Benefits Source - Shared Services: The Evolution of Higher Performance Copyright © 2009 Accenture All Rights Reserved 35 212. How are the benefits from Shared Services different from the benefits from Centralization? Global End-to-End Process Visibility, Governance Transition from Centralization to Full Value of Shared Services Many organizations stop here leaving value behind and decreasing the likelihood of sustainability and scalability Service/Cost Transparency Performance Mgmt. Metrics, Targets, Scorecards SLAs Clear 2-way services agreed by clients RANGE OF BENEFITS Continuous Improvement Benefits of centralization recede due to lack of shared accountability for performance and increase in shadow cost over time Re-engineering Simplified, standardized system/process Lack of Clarity Services, Costs Org. Culture - Tenure, wages, back-office mentality New Location Wage and real estate arbitrage Exceptions Increase Consolidation Re-organization and de-layering Shadow Cost Increase CENTRALIZATION SHARED SERVICES NOTE: Benefit ranges are illustrative. Copyright © 2009 Accenture All Rights Reserved 36 217. Multi-functional scope15 – 35% Annual continuous improvement benefit +1 – 3% Copyright © 2009 Accenture All Rights Reserved 37 237. Gather available data including headcount, labor costs, IT costs, transaction volumes, service level metrics, 271. What are the top ideas for improving service and cost performance? 272. What do you see as the key challenges / barriers to success? 273. What are the change management and communications challenges that must be addressed? Copyright © 2009 Accenture All Rights Reserved 39 274. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Copyright © 2009 Accenture All Rights Reserved 40 275. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Shared Services – It's not just centralization Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Copyright © 2009 Accenture All Rights Reserved 41 286. What are the key components of an effective Service Level Agreement (SLA)? The SLA is effectively the contract between the SSC and its customer, though legal language should be avoided if possible. Copyright © 2009 Accenture All Rights Reserved 43 288. SSC KPI – Average time to process T&E Pre-Audit 289. department KPI – Average time to resolve T&E ExceptionsCopyright © 2009 Accenture All Rights Reserved 44 290. How do we decide what is “shareable”? Shared Services Criteria Scoring Rationale Can answer “Yes” to each of the criteria Remote – Can process be completed without “in-person “ contact including remote access to the data/information? Transactional – Is the activity volume driven and/or involving transactional processing (e.g. average daily execution or more than 20 times per month)? Repeatable & Rules-based – Can a standardized, rules-based policy framework be implemented to handle the transaction? Measurable – Is the activity performance measurable? G Can answer “Yes” to a majority of the assessment criteria (>50%) through moderate business process and or policy changes Y R Does not meet any of the assessment criteria. Copyright © 2009 Accenture All Rights Reserved 45 293. Little focus on continuous improvement Vendor $ Departments $ $ Invoice information is entered into a system; multiple, non-standard processes may exist Invoices are received at multiple locations Payments are made to vendor based on multiple payment terms Inquiries are received at multiple locations ! ! ! ! ! Copyright © 2009 Accenture All Rights Reserved 46 298. Exceptions are managed by the shared services center with input from business units 303. Departments continue to manage the purchasing and receiving processes.Copyright © 2009 Accenture All Rights Reserved 47 304. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Shared Services – It's not just centralization Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Copyright © 2009 Accenture All Rights Reserved 48 307. Gain union buy-in of a high performance workplaceCopyright © 2009 Accenture All Rights Reserved 49 308. Looking Back – a brief history Nov ‘07 Jan ‘08 May ‘08 Apr ‘08 Feb ‘08 OAKS Financials Go-Live Assessment Results Shared Services Project Start-up Governor’s Executive Order 2008-01S RFP Award Implementation & Quality Assurance Business Case Published Copyright © 2009 Accenture All Rights Reserved 50 309. Shared Services End-State Scope Other Record to Report Procure to Pay Technology Services Hire to Retire Order to Cash Vendor Data Mgmt Fixed Assets Inbound Sales Strategic Workforce Planning Product Design Infrastructure Mgmt Outbound Sales Requisition and PO Generation ISTV Staffing Services Manufacturing End User Support Order Management Supplier Scheduling Total Rewards Planning Chart of Accounts Inventory Mgmt Infrastructure Development Collections Total Rewards Administration Receipt Processing Cost Accounting Warehousing Application Maintenance Customer Billing Accounts Payable External Reporting Distribution Application Dev & Implementation Time & Attendance Cash Application Travel & Expense Compliance Mgmt IT Business Planning Facility Mgmt Payroll Administration Sourcing Execution Cash Mgmt Planning & Performance Mgmt Enterprise Architecture Planning Real Estate Data Mgmt, Reporting, & Compliance Supplier Mgmt & Development Capital & Risk Mgmt Business Analysis Emerging Technologies Warranty Mgmt Workforce Dev Services Sourcing & Strategy General Ledger Order-to-Cash Function Mgmt Quality Assurance Marketing/Public Relations Organizational Effectiveness Services Compliance Management Risk Mgmt Finance Function Mgmt Legal HR Function Mgmt Procurement Function Mgmt IT Function Mgmt Internal Communications Legend Scope of End-State Source: OSS Business Case Copyright © 2009 Accenture All Rights Reserved Other Services 51 323. There will be no formal SLA for mandatory statewide servicesCopyright © 2009 Accenture All Rights Reserved 52 324. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Shared Services – It's not just centralization Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Copyright © 2009 Accenture All Rights Reserved 53 325. Agenda Shared Services – It's not just centralization Shared Services Example – Higher Ed Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Wrap-up and Next Steps Appendix Shared Services – It's not just centralization Shared Services Example – Government Sector Shared Services Example – Private Sector Shared Services Project – Discussion Copyright © 2009 Accenture All Rights Reserved 54 326. How are these benefits achieved? Global End-to-End Process Visibility, Governance End-to-End Process Ownership – exists when individuals across the enterprise understand process activities, dependencies, and performance regardless of whether the activities are completed within or outside Shared Services Performance Mgmt. Metrics, Targets, Scorecards Performance Management – defines Shared Services’ metrics and reporting both for internal and external purposes, and their appropriate use to throughout the organization to enable High Performance . Key components include: rationalization of Key Performance Indicators, creation of Internal and External Reporting capabilities, and definition of daily, weekly, monthly, quarterly, and annual Operational Rhythm and Key Controls. Service / Cost Transparency Service Management – includes the process and tools in place to effectively manageexpectations and quality of services delivered to Customers. Key components include: Service Level Agreement (SLA), Service Catalog, and Service Chargeback methodology. SLAs Clear 2-way service agreement w/ clients Copyright © 2009 Accenture All Rights Reserved 55 Editor's Notes Viewing the organization from the customer’s point of viewDeveloping process and enabling technologiesBased on customer needs & objectivesLeveraging the right segmentation, right channels, right services, and right resolution expectationsTailoring service to exceed customer expectationsEstablishing ‘Service First’ cultureTraining of staff to embrace ‘Service First’Exhibiting ‘Service First’ in every customer interactionCustomer Experience framework ties People, Processes and Technology efforts back to the Shared Service Mission and goals, ensuring that each is constructed with serving the customer as its purpose.
