Shared Services..do they really help to meet business objectives!!!
In the environment where the budgets for CIO’s offices are continuously declining (after all who wants to own ‘yet another fancy and heavy on features application software’ that requires a significant investment and without no surety of ROI) the businesses are left with two options:
1) Cancel the IT project that are in pipeline: Risk - Business Revenue may further slip southward due to the lack of support from IT for all the new & innovative ideas.
2) Delay the IT projects that are in pipeline: Risk – The delayed investment may not provide the benefits as expected due to missed business opportunity.
Is there any third option…yes of course… in my opinion all the options that help us to share the cost among the users of it would be worth exploring during these times of tough economical environment. The very simple example…”do we hire a chartered plane each time we need to fly from one location to another or instead we take the regular flights and share the cost of flying a plane with our co-passengers” . I am sure that for 99.99 % surveyors will choose the first option as this is the easy way to afford a flight and opt for various service options based on their preferences around urgency, comfort, privacy and brand value.
While we derive the analogy from the above example and envision an IT Service that can be shared across the customers, the key aspect is the management of the shared services organization. I believe that the idea of managing shared services organizations as independent profit centers brings lots of benefits. The few worth mentioning here are:
Ø Enhanced consciousness for making the shared services profitable
Ø Higher quality of decisions being made by the managers who are closest to the point of decision
Ø Faster speed when it comes to making operational decisions
Ø Mangers subjected to less of corporate constraints and can focus more on innovative solutions
An ‘IT shared services’ running profitably is a clear sign then the customers requirements have been understood correctly and they are being served at the right price.
In my next post let’s learn some of the components that contribute to the cost of running an ‘IT Shared Service’…….
