A Warning to Shared Services Organizations: Too Much Efficiency is Not Actually Efficient

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Posted: 03/24/2014

Focus on Innovation: Organizations seeking the "next step" in Shared Services are no longer debating the cost/efficiency play but are chasing quality improvements. They are targeting effectiveness instead of efficiency, and focussing on delivering flexibility in the face of constant change.

No one believes in Shared Services more than we do at SSON, yet we also recognize where the market is turning, and when it’s time to reassess a strategy. That’s where we find ourselves today.

Serco has just posted a whitepaper that identifies some trouble-spots for SSOs, and which I recommend you read. It's in reaction to a survey that found that although nearly 90%* of customers cite cost as a driver for services delivery models, ultimate satisfaction levels are based less on cost than on service output (quality). Even more interesting: less than a quarter claim "lack of business case attainment" as the cause of their dissatisfaction.

So, if customers’ [cost] targets are being met, why are they still not satisfied?

Serco dissects the problem starting at the root cause: if you base negotiations on cost, it’s always going to be about how you deliver, not what you deliver. But as services move from the back office towards middle and front-of-house operations, expectations change. Today, customers want business value through more effective operations. So staying focused on efficiency restricts performance. You end up where you started: as a low cost supplier.

I believe that each and every one of you would benefit from asking yourself the question: do I really and truly understand what my customer wants from me and is that reflected in my customer satisfaction measures?

Download the whitepaper here – free to you as part of SSON's knowledge resource.

Barbara Hodge, Editor, SSON

*according to a Deloitte survey.

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Posted: 03/24/2014

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