This presentation reflects the journey of Shared service center from evolution to maturity

1. 3 Generations of Shared Service Centers- The “Kal, Aaj
aur Kal” (Yesterday, today, tomorrow)

2. The “Kal, Aaj aur Kal” (Yesterday, today, tomorrow) - Shared service
centers can be categorized into three generations based on process,
functional , geographic scope and business impact /innovation. Initially
SSC (Shared service centers) were set up with a very clear objective of
efficiency and centralization to achieve cost reduction and many
fortune 500 companies have achieved indisputable impressive one time
savings. The next step (rather generation) is challenging which is
driving higher levels of continuous improvements in end to end
processes resulting in transformation driving bigger business impact
through innovation.

3. Stage 1- Cost Reduction and Driving Arbitrage
 This generation would focus on initiating and stabilizing operations primarily driving
savings through consolidation and labor arbitrage. Transactional processes consolidated
at single location/regi0on delivers immediate impact on P&L. Savings varies based on
model adopted, industry, geography and most often the scope approach of Pilot Vs Big
bang.
Key factors influencing the efficiencies at this stage 1 are
 Designing and implementation of site set up, hiring, transition and training functions.
 Detailed planning for Knowledge transfer, Validation of scope, deployment of standard
operating procedures (SOP’s), setting up Key performance metric (KPI’s).
 Disruptive set up of daily operations- no impact on ongoing operations during
implementation phase

4. Stage2- Operational Excellence and Driving Efficiency
 Post stabilization period as we move on cycles of monthly, quarterly and annual
processes, the need of increasing efficiency and productivity, strengthening controls and
reducing costs. Expand geographic scope, drive consolidation and centre of excellence
model (process based organization).
Key factors influencing the efficiencies at this stage 2 are
 Establish Process Blue print and drive further consolidation of processes- full geographic
scope
 End to end view of processes driving process optimization and efficiency
 Review authorizations and improve controls across processes- implement control
framework
 Standardizing processes and raising visibility of process metrics across F&A processes
 Rationalize headcount, Right skilling, enforcing process discipline
 Lean & six Sigma based continuous process improvement program in place

5. Stage 3- Business Partners
 As leading SSC’s become fully optimized for effectiveness and
business impact, going beyond operational excellence to allow
senior management to focus on strategic decision making.
Key factors influencing the efficiencies at this stage 3 are
 Detailed and through End to end knowledge of process , cross functional range
and Global view
 Standardization and Technology are the key business drivers to truly
implement business impact projects
 Business outcome focused rather than intermediate performance indicators
 Drive effectiveness and become business partners in organizational vide
transformation initiatives in overall finance function

6. The Next Step and what does it means
 The 3 generations highlighted here is a powerful framework to recognize where we stand
in our journey with our clients and envision the future, though there is no “recipe” to
achieve optimization. Different client situations are unique and must be understood
considering the culture, business need and organizational strategy and appetite to
change.
 While potential of optimization is significant, there are challenges around retention of
talent, controls and therefore a trusted partner with deep domain operational capability
and prove track record of process reengineering. SSC’s should have clear vision of future
projects with required leadership commitment else some of these would lose traction
and business impact projects often impact wider processes which are retained.
 My experience says, effort is worth it, most of us have witnessed these stages with many
clients. This is my learning through that…please do share and comment on your
experiences and how they evolved through this journey