What does shared services mean in finance?
Under the shared services center (SSC) model, low-value, back-office operations are consolidated in a central location and sold back to the rest of the organization. This removes the redundancies of running A/P, payroll, human resources, and purchasing in each separate business unit or country.
What do you mean by shared service center?
Shared services or shared services center (SSC) refers to a dedicated unit (including people, processes and technologies) that is structured as a centralized point of service and is focused on defined business functions.
How do you measure performance of shared services?
The Top 5 Metrics for Measuring Shared Services Performance
- Invoice Error Rate.
- Number of Invoices Processed per Employee.
- Cost per Invoice (Manual vs. Straight-through)
- Vendor On-Boarding Cycle Time.
- Customer Billing Error Rate.
What is service management metrics?
Service management metrics (at times also referred to as ‘key performance indicators’ or ‘KPIs’) are used to assess if the processes are running according to expectations. Defining KPIs is above all about deciding what exactly is considered “successful” process execution.
What is an example of shared services?
Services that can be shared among the various business units of a company include finance, purchasing, inventory, payroll, hiring, and information technology. For example, a central headquarters might control all the hiring for an entire chain of retail stores.
What are the benefits of shared services?
Why Shared Services for IT: 5 Benefits for Greater Efficiencies
- Location Strategy. By moving from multiple locations to a single location, an organization can reduce labor costs.
- “Right Sourcing – Right Job for the Right Skill”
- Cost Benefits.
- IT / System Improvements.
- Process Simplification.
What is SSC in outsourcing?
BPO/SSC is the abbreviation from Business Process Outsourcing and Shared Service Centre and means performing business processes for global corporate clients. Nowadays BPO/SSC is used by almost all the largest corporations in the world as well as more and more medium companies.
What shared services example?
Services that can be shared among the various business units of a company include finance, purchasing, inventory, payroll, hiring, and information technology.
How is productivity measured in shared services?
In most shared services operations, productivity is expressed as a ratio of work done (e.g. payslips produced) divided by the labour or time required to do the work (e.g. FTE’s per 1000 payslips). These productivity measures are then used to make comparisons.
How can HR improve shared services?
Collect feedback from your employees about your HR shared service center and look for ways how you can enhance your workflows. You can do this through regular surveys. Also, consider the changing needs of the organization, for example, when an organization is growing fast or is changing its policies.
What are service performance metrics?
What are service metrics and KPIs? Metrics are measures that provide you with the quantifiable information you can use to track service performance or progress. In order to obtain metrics, you need to clearly define what you want to measure, and then have a method for doing so.
What are metrics used for?
Key Takeaways Metrics are measures of quantitative assessment commonly used for comparing, and tracking performance or production. Metrics can be used in a variety of scenarios. Metrics are heavily relied on in the financial analysis of companies by both internal managers and external stakeholders.
Why invest in shared services metrics?
Investing in capabilities to track and report shared services metrics advances both internal and external objectives. These objectives include: Data about year-over-year transaction processing speeds and volume of work completed can be incorporated into regular reports.
Should you centralize the finance function into a shared services center?
A side benefit of centralizing the finance function into a shared services center is that it can reduce the proliferation of “silos” that tend to damage corporate culture and limit productivity. That’s especially true when the centralized finance function has good communication with other groups or companies inside the organization.
What is a shared services center?
Shared services centers absorb administrative work from campus units to realize efficiency and quality improvements.
What should I consider when considering a finance shared service model?
When considering a finance shared service model, it’s important to understand your current costs, structure and processes to help measure your performance against recognised best practice and measure any improvements. If you operate across multiple locations or have siloed teams then processes may be duplicative, too decentralised or too manual.