BrazilFive success factors for transitioning to finance shared services
A growing number of large organizations are establishing Financial Shared Services Centre (FSSC) to reap the benefits of scale, standardisation and cost effectiveness. Successfully transitioning to a FSSC is however easier said than done – experts from finance consultancy AGOS outline five key success factors.
1) Leadership buy-in
To embark on a new shared services delivery model, leadership must have clearly defined objectives and guiding principles on how the FSSC would operate within the organization. This may include the desired workplace culture, team structure and scope of services.
Throughout the transition, it is critical that leadership continue to play an active role in reinforcing the vision of transformation to wider organization as well as participating to make key decisions.
2) Scope and capacity planning
During the FSSC transition planning, it is important for both FSSC and the incumbent business team to align on roles and responsibilities; and to identify, discuss and agree on the job scope to be migrated to FSSC.
This may cover:
- Detailed review of current activities to define scope of work for the FSSC
- Assess complexity of the tasks
- Identify volume of transactions
- Alignment on the timelines for transition (e.g. knowledge transfer, parallel run, hyper care support etc.)
3) Change management
A change management plan needs to be integrated with the transition plan. This is to ensure there is a deliberate consideration of how the organization will be able to win the support and participation of their organization’s employees on the change.
Effective communication is essential to inform all stakeholders or to keep them updated about:
- Why: reasons for the change
- What’s in it for them: benefits of successful implementation for the employee and organization
- When / Where / How: details of the transition plan
4) Stakeholder commitment
Teamwork in the workplace is an essential part of any businesses. Therefore, FSSC employees need to work closely with the business team to understand their needs and wants. Doing so reduces the time spent for both teams on non-impactful activities and saves overall transition planning and implementation time.
On top of that, by proactively engaging with the business, FSSC may also identify opportunities to improve and improve efficiency of processes.
5) Monitor and measure benefits
Any Financial Shared Services Centre has four key characteristics that drive improvement – Centralization, Standardization, Automation and Continuous Improvement. To assess how well the transition is progressing, the performance for each of the process delivered is measured through key performance indicators (KPIs) on a periodic basis.
KPIs should cover the key targets of: Internal process quality; Customer satisfaction; and financial performance (e.g. efficiency, effectiveness and governance).
According to recent research from global management consulting firm Kearney, Malaysia is one of the world’s leading locales for shared services centres, alongside the likes of India and China. The finance function is one of the most popular areas for shared services, alongside information technology, procurement and facilities.
