Reflections: A Career in Public and Private Shared Services

Simon speaks with Stephen ...

There’s been a lot of discussion in the UK shared services space, recently, about trends and opportunities in the Public and Private Sector.

Simon Brown caught up with Stephen Forrest, a Shared Services Project manager with extensive experience in BOTH Public and Private sectors, to ask him what he thinks determines each sector’s opportunities.

Simon: Stephen, you have worked as a shared services and change interim manager in both public and private sectors, so what is the main difference in terms of context and approach? Stephen: I have worked in a range of public and private sector organisations, as well as voluntary and not for profit sector projects, in HR service roles since the start of my career in 1994. I started at Oxfam and moved through Balfour Beatty Rail to Manpower, to local government and then into my interim roles including manufacturing and financial services as well as the public sector. Within HR services, there are a number of similarities across all of these, where the Ulrich model has been a common catalyst, as well as quite a few differences, mainly driven by funding, organisation culture, and stakeholder leadership nuances. I can best summarise these under 4 key themes:

1. Partnership solutions

The public sector in the UK has a willingness to go for partnership solutions with other public sector bodies, including those in different parts of the country (the Northamptonshire and Cambridgeshire Councils’ shared services being a good example of this), clearly offering the potential for increased economies of scale, and greater opportunities for innovation and learning from each other. This partnership-with-other-companies approach would clearly be far more complicated in the private sector. However, with its very different stakeholders, the public sector is far less likely to make full use of the opportunities afforded by these solutions.

2. Decision making

Linked to the above point is that "Analysis Paralysis" can, in my experience, be more common in the public sector. Often this occurs when there are multiple and opposite vested interest groups, primarily as a result of the need to take political stakeholders into account. This is particularly evident in hung councils or councils with no overall control. I spent a number of years at City of York Council, having to adapt to a very different decision making culture after coming from the ultra-commercial perspective of Manpower with IBM. This can slow the speed towards true transformational change. The private sector may take commercial risks to move ahead in business. The public sector has no need to take risks and is often driven by maintaining the status quo of public interest. This can hinder innovation; in fact, the phrase "disruptive innovation" is not commonly used in the public sector, in my experience!

3. Use of outsource providers

This is not just a shared services issue, but I do see a difference between the ways that the two sectors work with outsourced providers as part of shared services operations. The private sector has far more scope within its often multi-national reach to offshore work than the public sector and that will not change as the public sector operates within government and country boundaries.

I think, however, that there is also a management issue. The private sector tends to have more of a commercial value proposition from its outsourced suppliers, building them into the shared services operation chain as partners. The public sector on the other hand can often see them as more of an external supplier to be managed and controlled within a tax funded budget, rather than looking to see what value this provider can bring, and what learnings they can provide. This is not country wide – whilst I was at City of York Council a few years ago, the London based local authorities in particular were always far more commercially minded, often co-operating with partner authorities to bring greater commercial value to suppliers as much as anything else.

4. Customer driven bespoke solutions

I see one of the major challenges facing shared services for both private and public sectors in the future as one of "individualisation". If HR follows the trend of marketing departments, trying to tailor bespoke solutions to a customer’s specific requirements/demographics, what will this mean? The challenge often thrown at shared services is that they fail because they are designed around efficiencies rather than customer needs. Certainly, I have heard this said in the public sector, which for the reasons stated earlier often displays far more of a command/control mentality. Possibly because of its background as part of the Home Office, the Forensic Science Service was a good example of this. I will not forget a line manager telling me that despite all the work the HR team and I had done to consult with them on reengineering processes, it was still expected that we would provide the regions with a fait accompli. Instead of this, my request to managers attending the final showcase event, with all my process maps on the walls, was to tear these to shreds if they didn’t like them – and then we would start again. Luckily for my own peace of mind, as well as, I suspect, for the senior HR team as a whole, there were only minor amendments.

Technology aids standardisation and efficiency savings. What it does not do is treat me as an individual. I can see the private sector being far more willing to change and adapt their shared services offerings, leveraging the more flexible cloud and software as a service platform technology. The public sector will probably follow this trend, but a lot later due to its restrictors of spend and speed of organisational change. In my experience the public sector can move extremely fast when it needs to, normally at the last minute when there is no option but to deliver the project.

Simon: How did you first get started in shared services? What did you do before? How did you become a shared services project leader? Stephen: I first became interested in shared services in the early 2000s at City of York Council, as I worked on bringing together directorate based local authority HR functions – both transactional and advisory, and first understood the difficulties of trying to align processes and teams to best effect. That started my journey of discovery as to how this model could best work.

My first real grasp of the power of SLAs and metrics however, came from a far more commercial, fast moving managed service environment at the turn of the century – working for Manpower with IBM as the onsite client in one of their flagship EMEA customer contact centres. I will not forget having to provide the IBM director with exact absence statistics by 10am every morning, across all sectors of the workforce, for the first 6 months of my time there. Nor will I forget having to provide her with 40-50 page monthly reports detailing every possible metric imaginable and having to answer her questions on them early the following morning. Having to manage to very tight metrics and exceed them focused the mind very clearly, as did the whole concept of "customer is king".

In my early formative HR years, the customers seemed far more remote. They were our line managers and there was still a tendency to look at them as being peripheral to HR. Talk tended to be about line managers "just being unwilling to understand our processes". In a managed services environment, our customers were on site and extremely visible. The power in the relationship lay with the customer and HR shared services was very much subordinate.

Simon: What would you say are the most important characteristics for a shared services leader to demonstrate effective leadership? Stephen: I think there are two factors at play here.

Firstly, a shared services leader needs to be a business leader. Leading teams that have to manage high volume transactional activity is very different from managing a mixture of "professional" and administrative HR.

Secondly , and related to that business leader role, is the fact that as a shared services leader you need to be equally happy with the detail of the process as you do with discussing HR and organisational strategy. To me, that is the most difficult part, and does distinguish the true shared services leader. I have met plenty of able strategists who are not so comfortable on the process side, and a number of high level "process experts" who were not particularly happy discussing organisational strategy outside their own process driven environment.

Simon: So "stractical" then! Both strategic to shape the service, and tactical to manage operations. Stephen. Yes exactly!

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Simon: What were the biggest challenges you've faced in your shared services career, Stephen, and how did you overcome them? Stephen: The biggest shared services challenges for me are varied and frequent. Having worked with shared services primarily as an interim/ consultant, it really means that I face a different challenge whenever I come into a new organisation. I enjoy that.

Simon: Ok, so what are the biggest achievements in your career? What are you most proud of? Stephen: Influencing our managed service IBM customer to accept that we, as Manpower, could deliver a quality customer service through completely refocusing the way we delivered the service, has to be high on my list of achievements! And having to learn on the job how to manage a large team in the first place, and embrace the whole concept of customer service in a very challenging and demanding environment, whilst at the same time having to re-engage our European recruitment partners gave me a "triple buzz "which I’ve never forgotten!

Simon: How do you measure the effectiveness of shared services and how do you measure your value to the business? Stephen: I have seen a vast number of metrics but very often they are fairly meaningless. Certainly one shared service that I did some work with (and which I hesitate to name) had over 100 metrics, which they reported on every month. Very few of them would have meant anything to those Board members who would have received them.

I firmly believe that every transaction has to be measured, but many of these should be primarily internally reported. As shared services your primary focus is the customer. Speed of turnaround is meaningless if it is accompanied by a multitude of errors and necessary reworks. For me, Customer Surveys have to be the best way of measuring your true effectiveness as a shared service.

Simon: Fully agree. Overall effectiveness, measured by Customer satisfaction is key. What advice would you give to someone wanting to progress their career through shared services? What should they be focusing on? Stephen: I would always advise anybody considering shared services to get as much exposure to different parts of HR as they can, so that they can understand where the processes go once they have left the shared services centre. I would also recommend everybody in a shared services environment should experience that same centre from an external perspective, in another HR role or as a line manager. See how your processes really feel outside your centre. Put yourself in their shoes. Always challenge what you are doing and how you are doing it. Does it benefit the customer? If not, why are you doing it at all? I do keep talking about my Manpower experience, but it was certainly the start of my career as a "thinking" HR professional, having to argue, as a line manager, with my own HR team on the other side of the country, about the fact that my daily business realities did not fit HR policies and procedures. One local authority that I worked with on the creation of shared services, had a separate transformation directorate, where all project managers and analysts were supposed to be based. In theory this was meant to share experiences, but in practice it also divorced you from the teams that you were working with.

Simon: Finally, what do you think of the brand name: Shared Services? Like it? Any good alternatives? Stephen: I am not a fan of the "Shared Services" brand. The term does not indicate what the service actually does. However it is the brand name that management knows. If anything, it often means more in the public sector because their services are often truly "shared" between different public sector bodies. Where you have local authorities sharing services across authority boundaries, that is where you can have a true shared service. Similarly you have models such as the South West model, which includes the police and local authority amongst others, and supported by IBM.

Simon: Good point. Some interesting and honest insights and themes across both sectors here, Stephen. I enjoyed our discussion. Thanks for sharing your private and public thoughts!

About Stephen Forrest:

Following a degree in Modern Languages and 3 years as a teacher, Stephen moved into the HR arena. Starting his career at Oxfam, itself undergoing huge change at the time, Stephen then moved into the railway industry with Balfour Beatty. After an exciting period on a Manpower managed services contract with IBM where he was able to use his languages to best effect, he moved onto local government. He has now been an interim manager for some 6 years, primarily focusing on shared services and change management projects. seaforrest@yahoo.co.uk