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Governing your realm to ensure your customers are consistently delighted with your shared service staff
The document discusses four models for shared services: 1) new company with SSC core, 2) new company with strategy/delivery split, 3) existing company with strategy/delivery split, and 4) existing company functional model. It proposes model 3, an existing company strategy/delivery split. Key criteria for decision making include maturity, culture, structure, and tax implications. Selling the chosen model requires evaluating all elements, involving all disciplines, and gaining understanding and buy-in from decision makers.
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Governing your realm to ensure your customers are consistently delighted with your shared service staff
- 1. Shared services nexttop model: What operating model would you vote for ? 14th March 2012
- 2. Agenda • Geodis overview • Operating models • Four models • Strengths and weaknesses • Model proposed • Decision making criteria • How to sell the chosen model, gain understanding and communicate the impact 2
- 3. Geodis Group Geodis is Europe’s fourth biggest operator, a Group of global dimension, able to deliver added value logistics solutions for part or all of your supply chain. • WE ARE PRESENT AT EACH STEP OF YOUR SUPPLY CHAIN Present in 120 countries with a workforce of 30,000, our Group comprises core business divisions along with a cross-divisional entity – Geodis Global Solutions – delivering end-to- end solutions in all sector of activities. Revenues 2010 Eur 8.9 Billion. • GEODIS WILSON Delivers Freight Management and Freight Forwarding services worldwide by air, sea or a combination of the two. 5,700 employees. • GEODIS CALBERSON Supplies groupage and express road distribution throughout Europe – domestic and cross border solutions. 11,000 employees. 3
- 4. Geodis Group (continued) • GEODIS LOGISTICS Manages your logistics flows and implements expert logistics solutions from supplier procurement to final distribution. 5,000 employees. • GEODIS BM Provides road transport services across Europe: full and part loads, transport on request, dedicated transport, rental, direct flows or flows via platforms, distribution and inter-site rounds. 3,500 employees. • GEODIS GLOBAL SUPPLY CHAIN OPTIMISATION Builds global logistics and supply chain solutions, selects and integrates best value service partners, provides visibility and continuous cost optimization. 1,200 employees. 4
- 5. Operating models • Four scenarios • 1. New company, SSC core • 2. New company, Strategy / Delivery • 3. Existing company, Strategy / Delivery • 4. Existing company, Functional • Model proposed NB. Finance and HR are used as an example, multi discipline could be used 5
- 6. Model 1 New company, SSC Core Division or Company 1 Ltd New Company Ltd Division or Company 2 Ltd Business Business Shared Managing Requirements Shared Service Requirements Managing Services Director Director Director Governance Agreed Agreed Strategy Strategy HR Director Finance Director Reporting / Reporting / Information Information Delivery HR Finance Transactional Managers / Managers / Transactional Processing Staff Staff Processing Functional Functional Business Business Support Support 6
- 7. Model 2 New company, Strategy / Delivery Division or Company 1 Ltd New Company Ltd Division or Company 2 Ltd Shared Managing Business Business Managing Services Director Requirements Requirements Director Governance Agreed Strategy Here or ... HR Director ...Here HR Director Shared Service - Strategy Delivery - Strategy Formulation - Value Added Services Director - Functional Business Finance Director - Transactional Services Finance Director Support Delivery Reporting / Reporting / Information Information HR Finance Managers / Managers / Staff Transactional Transactional Staff Processing Processing 7
- 8. Model 3 Existing company, Strategy / Delivery Division or Company 1 Ltd Division or Company 1 or 2 Ltd Division or Company 2 Ltd Shared Managing Business Business Managing Services Director Requirements Requirements Director Governance Agreed Strategy HR Director Shared Service - Strategy Delivery - Strategy Formulation Director - Value Added Services - Functional Business Support Finance Director - Transactional Services Delivery Reporting / Reporting / Information Information HR Finance Managers / Managers / Transactional Staff Staff Transactional Processing Processing 8
- 9. Model 4 Existing company, Functional Division or Company 1 Ltd Division or Company 1 or 2 Ltd Division or Company 2 Ltd Shared Managing Business Business Managing Services Director Requirements Requirements Director Governance Agreed Strategy HR Director Finance Director - Strategy Formulation - Strategy Formulation - Functional Business - Functional Business Support Support Delivery Strategy Non SSC Non SSC Strategy Delivery Delivery Reporting / Reporting / Information SSC SSC Information Transactional Transactional Processing Processing - Strategy Delivery - Value Added Services - Transactional Services 9
- 10. Models strengths andweaknesses (Discuss) 1. New company, SSC Core 2. New company, Strategy/Delivery Division or Company 1 Ltd New Company Ltd Division or Company 2 Ltd Division or Company 1 Ltd New Company Ltd Division or Company 2 Ltd Business Business Requirements Requirements Shared Shared Managing Director Business Business Managing Director Managing Director Shared Service Director Managing Director Services Requirements Requirements Services Agreed Agreed Governance Governance Agreed Strategy Strategy Strategy HR Director Finance Director Here or ... HR Director ...Here HR Director Reporting / Reporting / Information Information - Strategy Delivery - Strategy Formulation Finance Director Shared Service Director - Value Added Services Delivery - Functional Business Support - Transactional Services Finance Director HR Finance Managers / Staff Managers / Staff Transactional Transactional Processing Processing Delivery Functional Reporting / Reporting / Functional Business Information Information Business Support Support HR Finance Managers / Staff Managers / Staff Transactional Transactional Processing Processing 3. Existing company, Strategy/Delivery 4. Existing company, Functional Division or Company 1 Ltd Division or Company 1 or 2 Ltd Division or Company 2 Ltd Division or Company 1 Ltd Division or Company 1 or 2 Ltd Division or Company 2 Ltd Shared Business Business Shared Business Business Managing Director Requirements Requirements Managing Director Managing Director Requirements Requirements Managing Director Services Services Governance Governance Agreed Agreed Strategy Strategy HR Director Finance Director HR Director - Strategy Delivery - Strategy Formulation Finance Director - Strategy Formulation - Strategy Formulation Shared Service Director - Value Added Services - Functional Business Support - Functional Business Support - Functional Business Support - Transactional Services Delivery Strategy Non SSC Non SSC Strategy Delivery Delivery Delivery Reporting / Reporting / Information Information HR Finance Managers / Staff Managers / Staff Reporting / Reporting / Information Information SSC SSC Transactional Transactional Processing Processing Transactional Transactional Processing Processing - Strategy Delivery - Value Added Services - Transactional Services 10
- 11. Models strengths andweaknesses Examples of.... Strengths Weaknesses Model 1 New Company - Best Chance to reduce management - Complex to implement SSC Core - Best regional model - Set up new company - SSC seat at the "high table" - Employee T&C's - Maximises SSC breadth - Need to be used to complex structures - Profit or Cost Centre - Transfer pricing / charging Model 2 New Company - Split, Strategy/Deliver Specialise - Set up new company Strategy / - Directors focus on Strategy - Employee T&C's Delivery - SSC focuses on delivery - Transfer pricing / charging Model 3 Existing Company - Split, Strategy/Deliver Specialise - Charging between companies Strategy / - Directors focus on Strategy Delivery - SSC focuses on delivery - No new company Model 4 Existing Company - No new company - Charging between companies Functional - Simpler to implement - Easy to Understand / Communicate - Easiest to Setup for a Startup - Easier for SSC and non-SSC activities 11
- 12. Model proposed Company 1 Company 1 Company 2 Direction (Migrate T&C’s / contracts over time) Control Budget Shared Service Centre Steering Committee Resources Shared Managing Managing Business Business Partnership Services Director Director Requirements Requirements Governance Agreed Strategy Shared Service Centre Management Group HR Director Finance Director Strategy Formulation Finance Functional Business HR Business Transactions / Support Partner Delivery Reporting Strategy Strategy HR Payroll Delivery Delivery Operational IT Expertise Indirect Expertise HR Administration Purchasing Monitoring Monitoring Company Reporting / Health Secretarial Reporting / Information & Safety Information Insurance Transactional Security Transactional Facilities Processing Processing Business Finance Strategy Delivery Dedicated Business Value Added Services Support Transactional Services 12
- 13. Model proposed -Reasons • Start up SSC • Simple • Easy to understood and communicate • Minimised the increase in Management Team • Can be developed later to another model as entrants and volumes increase • No Tax advantage in moving to a new entity 13
- 14. Decision making criteria • Maturity of Shared Services and the Organisation • Culture of the organisation • Existing reporting lines, simple or matrix • Group Structure • Company and Division (Legal Entity versus Subsidiary) • Tax and VAT • Transfer Pricing and Charging • Capitalisation 14
- 15. How to sellthe chosen model, gain understanding and communicate the impact • Identify the real decision makers • Ensure all elements have been evaluated • Assess Group requirements • Listen carefully to Senior Management requirements • Investigate Tax, VAT etc • Involve all disciplines in the model development and feedback • Depends on who is potentially put at risk • Group Management • Local Senior Management • Leaders of HR, Tax, Finance etc • Include a Risk Analysis for each option • Evaluate the impact of each on the Organisational Design, SSC and Company • Meet regularly with the real decision makers, ensure they understand and buy-in 15
- 16. Summary • Take care to identify real decision makers • Your model may end up being a hybrid • It might be decided on maturity of the business rather than financials • Have facts to back up the chosen model 16