Shared Services Organizational Consolidation Benefits – Centralized Services

Shared Services Organizational Consolidation Benefits

Providing shared services is quite a common practice among many organizations in today’s business world. Shared services simply means centralized services where two or more organizations merge to provide a particular service and thus enjoy shared services organizational consolidation benefits. Often the gist of providing shared services is to boost the customer experience when delivering your services to enable the company or rather the companies in question attract more loyal customers for business success. However providing shared services is a little different from merging two businesses as only specific services may be provided in such a joint venture and not necessary all the services like the case when two companies fully merge.

Operational upsides of Shared Services

The sole reason behind provision of shared services is to cut on costs involved in providing a given service. Provision of shared services usually comes along with the benefit of economies of scale allowing a business to enjoy huge discounts that immensely reduce their operational costs in the long run. Companies are also able to reduce the time they would have otherwise used to provide certain services if they were operating individually therefore in addition to providing cheap services, organizations are able to provide services faster which is normally a great plus to many customers.

Besides by joining the workforce of two companies it becomes easier to offer quality services that can easily win over more customers to the organization.

Internal advantage of shared services

The internal operations of a company are greatly impacted by shared services organizational consolidation benefits as well. Due to centralization brought about by provision of shared services factors like communication are improved as there are often fewer channels of communication for easier and quicker relaying of feedback. Additionally supervision of employees is mitigated for centralization, brings employees in one location in the firm where it is easy for the departmental manager or supervisor in charge to oversee the services carried out by employees. As a result the general performance of the company tends to improve.

How to effectively implement shared services

While there are a good number of companies out there that have tried out providing shared services, the truth is that not as many of the businesses have experienced shared services organizational consolidation benefits. The problem with many organizations is that they don’t streamline the hierarchy of authority appropriately hence implementing shared services effectually becomes a problem. You will need to keep in mind that the management of the companies ‘merging’ here will have to come into an agreement on how they will oversee provision of the services in question and who will be accountable for what specifically before they can actually reap the shared services organizational consolidation benefits.

Team work will be important in such an arrangement and there will be need for managers of both companies to put any individual interests aside and give the organizations benefits first priority.

To ensure that the implementation of shared services is working out well for both companies it will therefore be necessary that the shared services system to be reviewed after some time. This will enable the management to gauge whether they are reaping any shared services organizational consolidation benefits or not.