Why Now? Could a Shared Service Centre Benefit Your Business?

Shared service centres (SSCs) aren’t a novel concept, and yet figures show that their popularity has increased dramatically in recent years. The value of the global SSC market rose above $50 billion in 2023, and is set to grow annually at around 16% to more than $280 billion by 2032. At that point, there will be around 336,000 SSC units worldwide.

Driving that momentum is the value SSCs deliver through the centralisation of services; most generate cost savings of around 20%, while larger organisations stand to save up to 50%.

But even with compelling cost savings and added strategic benefits, initiating an SSC outsourcing project, and beginning the process of consolidating services such as finance and compliance, isn’t a decision to be taken lightly.

Your organisation needs to be confident that it has the resources, skills, and infrastructure to launch, maintain, and optimise its SSC over the long term — or it risks reducing, or even missing out on, those savings.

So, while the idea may be compelling, what should you know, and how should you prepare, before you migrate services to an SSC?

Let’s explore the key factors.

Shared Service Centres: Problems and Solutions

Specific problems often serve as useful indicators that an organisation will benefit from the move to an SSC.

Skill shortages

Growing firms need to strengthen their teams to maintain the quality of service they provide. But finding employees who meet the relevant skill criteria, in sufficient numbers, isn’t always easy in certain locations — which can drive up recruitment costs. If you’re struggling to fill roles for current operations, SSCs can offer access to larger pools of talent at greater cost efficiency.

Global volatility

The inherent volatility of global political and financial landscapes can leave businesses struggling to micromanage regional challenges. SSCs enable companies to mitigate those effects by centralising critical services in a single location. Similarly, the geographic position of an SSC may open up specific global and regional markets that would not have been as accessible while operating solely from a parent company HQ.

Manual workflows

Reliance on manual processes can delay and fragment critical tasks such as the month-end close, especially in global organisations with complex cross-border workflows. SSCs offer an opportunity to integrate automated tools that reduce or even eliminate the need for manual intervention while adopting a centralised technology infrastructure that streamlines and standardises workflows across the organisation.

Team collaboration

Globally distributed teams face an array of collaboration challenges, not least time-zone differences, regulatory disparities, and language barriers. If your teams are struggling with cross-border efficiency, SSCs naturally support distributed workforces by providing a single, centralised platform that can remove most, if not all, barriers to collaboration and communication, including the need to coordinate between teams in multiple locations.

Siloing

If siloed data and insights are slowing down task completion, it makes sense to consider centralising those workflows in an SSC. For example, by centralising the finance function, accounting teams can increase visibility and accountability for month-end tasks, spot and address delays more efficiently, reduce the likelihood of duplicated work and the need for remediation, and apply compliance controls more consistently.

Economies of scale

Global growth can compound pressure. For example, teams working in separate locations may need to purchase multiple software solutions, find that time differences exacerbate bottlenecks, or struggle to apply uniform analytics across workflows. In such cases, SSC consolidation may not only provide direct cost savings but also create exponentially beneficial economies of scale. These benefits may manifest in the possibility of sharing software licences across teams, or in faster completion times that free employees to focus on more value-adding tasks.

Shared Service Centre Foundations

Recognising efficiency problems, and understanding how SSCs can solve them, is an important step in your SSC decision-making process, but it’s only part of the migration journey.

The move to an SSC can’t happen until other critical preparatory steps are complete, such as securing endorsement from leadership and buy-in from team members (especially those directly affected by the transition).

With that in mind, your SSC migration project should only commence once the following foundations are in place.

Strategic alignment

The benefits of outsourcing must align with your business goals and principles. That means collecting data to support the case for SSC migration, identifying the services that will be transitioned, securing premises for the SSC, and defining the type of SSC infrastructure you intend to create.

Process mapping

You’ll need to review the people, processes, and technologies involved in the services being outsourced to the SSC, and then map them onto the proposed SSC infrastructure. This process must be thoroughly documented to ensure there is no disruption or loss following migration.

Technology infrastructure

The efficiency benefits of your SSC are predicated on your organisation having appropriate technology infrastructure in place. Before your migration, you’ll need to identify a software platform that supports automation of the relevant services, integrates with your ERP, and includes features such as dashboards, collaboration tools, security, and centralised storage. You’ll also need to ensure it provides a control framework capable of managing the SSC’s consolidated compliance requirements.

Change management

SSCs can’t function without people, and so it’s important to prepare employees for the migration in order to retain talent and minimise disruption. To that end, you’ll need a robust change management plan to assist existing employees who are relocating and an effective, role-specific onboarding process for local recruits joining SSC teams. Aim to mitigate resistance by communicating migration plans early and by involving frontline staff as soon as possible in the SSC design process.

Power Shared Service Centre Benefits with FloQast

The move to an SSC is ultimately contingent on your organisation being capable of establishing outsourced infrastructure that provides clear visibility and accountability, standardises processes and workflows, facilitates robust communication with HQ, and scales with your company as it continues to grow.

That’s where FloQast comes in.

FloQast is designed to power every aspect of your outsourced finance function — from centralising core workflows and standardising accounting tasks, to automating reconciliations, compliance controls, and reporting. Our platform integrates with numerous ERPs, cloud storage tools, and collaboration apps, enabling your SSC teams to work seamlessly with counterparts around the world, optimise cost savings, and unlock new efficiencies over the long term.

If you’re planning the first steps of your outsourcing journey, now is the perfect time to learn more about what we do, explore the capabilities of our platform, or book a demo to get a closer look at our SSC tools.

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