Insights-Driven Business Services take shared services to the next level

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Imagine if shared service organizations become innovation drivers and business enablers, supporting your business with best-in-class services and virtual workforce.

A need for action

Shared services are typically already an important element of CxOs’ agendas, but today’s economic environment makes it crucial to prioritize them even more. From logistics, to insurance, to manufacturing and retail – in all major industries, increasing global competition, partially paired with regulation, puts companies under pressure. More than ever, businesses need to act and tackle the potentials of an efficient organization, streamlined processes, and enhanced service delivery, leveraging the infinite but still-growing number of digital solutions. Efficiency and quality, driven from back-office to core processes and backed by clear E2E ownership, can boost margins.

Shared service organizations as a solution

SSOs (shared-service organizations) are the key to realize those potentials for corporates across business units and regions. While previously, SSOs were often limited to function-oriented and transactional service-providers, SSOs have continuously developed and professionalized. The extension of SSO scope to “core-value” functions, such as purchasing or sales, the integration into globally standardized end-to-end processes, or the intensified use of automation solutions – these trends show that SSOs are moving ahead (Figure 1 depicts current shared service trends and maturity levels).

Figure 1: Current trends in Shared Services and SSO Maturity Levels

Taking SSOs to the next level: Insights-Driven Business Services

Capgemini Invent takes SSOs to the next maturity level, positioning them as the company’s driver and enabler of continuous innovation & efficiency improvement. We define the next level of SSOs as Insights-Driven Business Services (IBS) that are characterized by four major pillars (Figure 2 depicts the main building blocks of IBS):

  1. Global sourcing mix: A global delivery network with hybrid sourcing (multi-tower captive shared services and outsourcing) allows ideal service coverage, finding the optimal balance between cost optimization and customer satisfaction.
  2. End-to-end view: A full SSO integration into global, “horizontal” end-to-end processes (e.g., P2P, O2C, A2R, etc.), including standardized governing metrics and data analytics enables harmonized service-level differentiation and constantly improves SSO delivery performance through clear SSO-responsibilities.
  3. Digital enablement: The SSO constantly strives for the optimal combination of human and virtual workforce, using diverse tools such as RPA or AI, enabling seamless process delivery on a global scale.
  4. Data centricity: The positioning of the SSO as data hub, being the interaction engine between customers, employees and suppliers, allows profound insights and value-adding services, e.g. via use-case oriented Data Science CoEs that are maturing and scaled towards “as a Service” for 3rd parties.

In comparison to the core operations departments that often simply have other priorities, IBS benefit from smart specialization, a growing integrated process ownership, and platform-based as well as digitized infrastructure. IBS serve as data hubs, being the interaction engine between customers, employees, and suppliers. As a result, they foster insights-driven user centricity and engagement. Examples for the value-add, beyond-pure transactions are the piloting of new digital solutions, Group-wide implementation support (e.g., chatbots, process mining, etc.), the operation of innovation hubs for product and service development, as well as offering improved post-merger integration services. IBS can drive the evolution of a whole company, bringing it ahead of the competition.

Key pillars of IBS
Fig 2: Key pillars of IBS

Efficiency levers of IBS

IBS unveils enormous efficiency potentials while supporting the core businesses’ sustainable success. It leverages various SSO target operating model optimization drivers, such as smart sourcing, scaled technology, streamlined governance, and professionalized demand and service management. Taking advantage of these potentials, companies can reduce run costs by up to 40% (Figure 3 depicts major IBS efficiency levers).

Efficiency Drivers of IBS
Fig 3: Efficiency Drivers of IBS

Customized, pragmatic, and sustainable – The Capgemini IBS transformation approach

Our experience from existing and new contacts across all industries reveals that there is always room for measurable improvements. We tailor our approach to our clients’ individual SSO maturity level (see Figure 1) with the ambition to create the highest value for their business.

Keeping this in mind, we differentiate ourselves through five main principles:

  • Customization maximizes value: Considering IBS as the highest possible SSO evolution level, we tailor our approach to clients’ individual maturity level and desired target state. This allows us to define the right guidelines for the SSO transformation journey, to detail the right service scope for the SSO and to consistently plan concrete actions.
  • Insights-Driven tools quantify potentials: We utilize diverse insights-driven and digital tools (such as Cost Discovery Scan or process mining) in order to rapidly create transparency on optimization potentials based on client-specific data.
  • Target Operating Model sets the stage: A target operating model is the central element & steering framework of any SSO. We apply proven and innovative tools & methods such as the Guide Deliver Receive methodology, to ensure implementing an efficient Target Operating Model according to the desired SSO key pillars (e.g. Global Sourcing Mix, End-to-End-View, Digital Enablement, Data Centricity, Innovation & Efficiency Driver for Executives).
  • Digitalization@Scale optimizes efficiency: Digitalization plays a major role in today’s SSOs. We provide scalable automation solutions (e.g. leveraging RPA or Chat Bots) that perfectly meet client needs to ensure long-term success and efficiency.
  • One-Stop-Shop allows an integrated journey: We accompany our clients throughout the whole SSO transformation journey – from strategy to design to implementation. Our Shared Service project track record in combination with the proven expertise from own SSOs as well as our BPO provider activities enables us to support clients in the best way possible, executing transitions with our tollgate-based methodology

Key take-aways:

  • Shared services are the key for companies in all industries to substantially increase efficiency in a challenging economic environment.
  • Various trends in the world of shared services, leveraging the potentials of digitalization, allow SSOs to mature.
  • IBS is the next SSO maturity level, combining a Global sourcing mix, an End-to-end view, Digital Enablement & Data centricity to become innovation drivers & business enablers
  • IBS unveils run cost saving potentials up to 40%.
  • The Capgemini approach for a Transformation of SSOs towards IBS is driven by Tailored Target Setting, Insights-driven Analysis, TOM Excellence, Digitalization@Scale & One-Stop Shop

If you have any questions or want to discuss shared services in more detail, please do not hesitate to contact the authors, Jannis Kachel and Max Scheuermann.

Author

Jannis Kachel

Senior Manager

Capgemini Invent

Max Scheuermann

Manager

Capgemini Invent