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Shared-Services in Government

The majority of government executives believe that shared services are important to helping them achieve their organizations' strategic goals, according to a study released recently by Accenture

The majority of government executives believe that shared services are important to helping them achieve their organizations' strategic goals, according to a study released recently by Accenture.

As part of the study, "Driving High Performance in Government: Maximizing the Value of Public Sector Shared Services" Accenture interviewed more than 140 senior executives at all levels of governments across 13 countries in Europe, North America, the Asia Pacific region and Africa. The goal was to identify their views on and use of shared services -- which Accenture defines as the consolidation of administrative or support functions (such as human resources, finance, information technology and procurement) from several departments or agencies into a single, stand-alone entity to provide services as efficiently and effectively as possible.

Eighty-five percent said they believe that shared services are playing or will play a role in supporting their organizations' strategic goals. In addition, two-thirds (66 percent) of the government executives reported that they had already implemented, or were in the process of implementing, shared services, while 6 percent of respondents said they would not even consider a shared services model. The most common processes found in government shared services are related to information technology, finance and human resources.

The study also found that moving to a shared services model gives organizations the opportunity to shift budget from administrative activities to front-line, citizen-facing services, helping to drive out significant cost reductions while at the same time improving government services.

The top three objectives for shared services identified by respondents were to help meet efficiency targets, facilitate cost reductions, and address citizen demands for improved services. The respondents also acknowledged an array of other value-oriented shared services objectives, including strategic benefits (e.g. through standardized processing environments and improved systems) and improved service quality and speed of delivery.

Among other key findings:
  • Most governments in-source their own shared services centers, although many rely on outside expertise during planning.

  • The unique nature of governments sets up some very specific challenges to shared services, such as a lack of the necessary managerial skills to tackle a transformational change program or a lack of clear leadership support or top-level commitment to change.

  • While two-thirds of the government executives interviewed said they have started to implement some key components of a true shared services operating model, few have implemented them all; thus few have realized the full potential of their shared services strategies.
Despite the challenges, some government leaders have already begun achieving significant benefits from implementing shared services. Government leaders in Australia, Singapore, Germany, Ireland, the United Kingdom and the United States reported having already reduced costs and achieved greater efficiency in certain areas.

Another aspect of the study involved more extensive interviews with government executives that Accenture considers shared-services "innovators" at 11 different agencies around the world. These government leaders spoke about the rationale behind their decisions to implement shared services, the stages of their journeys, the challenges they encountered, their measures of success, their critical success factors, and lessons they learned.

Among the leading practices these innovators identified were:
  • Defining a clear vision, business strategy and operating model;

  • Building a strong, detailed business case based on measurable returns;

  • Conducting a detail-driven approach to planning;

  • Identifying full budgetary requirements at the outset;

  • Creating the shared services organization as a stand-alone entity;

  • Creating a strong governance structure that includes user departments and service-level agreements;

  • Managing workforce issues closely;

  • Ensuring that the right enablement capabilities are in place;

  • Transforming the internal culture; and

  • Measuring performance.