The Shared Service Centre… the key to our salvation or our downfall?

Lead us well or leave us be!!

Leadership, SSC, functions, centralisation, strategy and vision, what they all have in common is the “3P’s” on which all enterprises post core concept are built; which is People, Process and Profit.

So, with that in mind, the Shared Service Centre was born in an attempt to increase controls and operational expertise/effectiveness by region whilst reducing costs through standardised process design, controls compliance, cost synergies in resources by region and other benefits through the economies of scale a SSC can bring to a large regional or global organisation. 

A shared service model is a centralised model at inception and it is assumed that the key process designs creating the infrastructure will be cost effective, integrated and lean in construct. A SSC model also assumes returns based on auxiliary functions being centralised and expertise deepening through “shared experiences”. Sounding good?? It sure does to me, so where is the problem and what can we do about it to ensure our business is sustainable into the longer term whilst supporting our company’s short-term goals?

Leadership - Regional Impact of a multifunctional SSC can be devastating to a business if the SSC is poorly led at one or more levels. Impacts from poor leadership can range from service limitations to severe business disruption as a result of poor SSC leaders. Conversely, well-led SSC’s can enhance service offerings and unlock value in process efficiencies supporting business development in ‘entity territories’ that engage the SSC for key services and functions.

Risk Management – A well planned out SSC will have a plan should the building burn down, but in truth, many don’t. The risks involved in having key back office functions in one place are many including loss of access for staff to fulfil SSC service offerings or indeed the loss of staff themselves should the building become uninhabitable or destroyed. Even with a well-planned and rehearsed contingency plan, business disruption is inevitable.

Standardisation – A centralised model runs the risk of becoming overly bureaucratic often in an attempt to gain more visibility over what entities are doing and reporting on. What is necessary for one entity may be redundant for another. However, standardised protocols may create a bureaucratic attitude and culture that aids stable project management but runs the risk of dampening innovation.

I could go on, but the risks defined above merit deep thought and if you come up with scenario based solutions to these, you will have addressed major downside risks to a successful SSC operation.

To aid you in this, the following should be considered in any review:

• ü  What are the objectives of the SSC by function, by service, by entity? Is the company engaged in centralised processes or is it totally new as a concept? Are the change management structures in place to handle this change? Will the project unlock or produce value if successful? What are the risks in if partly successful or if it fails? Is scope comprehensively defined bearing the company culture in mind?
• ü  Are the services of the SSC clearly thought out, mapped out in the existing structures and considered in terms of value creation from their existing place in entities (or totally new) to a shared service centre environment?
• ü  What company culture exists and will it need to change to incorporate an SSC? What leadership practices are preferred in the organisation? Is there a detailed and effective selection process in place to deal with selection of leaders and subsequent employee workplace practices supporting the service level provision of the SSC?
• ü  What process management methodologies are being used and are they suitable in practice to fulfil the scope definition set out for the SSC?
• ü  What risk management and project management structures are inset with the SSC structure to deal with SSC change management projects along with strategic risk management issues?
• ü  Does the SSC have a senior level leader that has reporting relationship with the board (C-Suite)?
• ü  Is there a detailed plan balancing service level provision, continuity of service, work place practices and culture along with leadership in place to ensure the SSC is a functional unit that fits into the overall company culture and organisational setting, yet is flexible enough to enact change as a flagship unit of the company?

All good thoughts, which should factor into key planning sessions and the execution of outcomes therein. The road to heaven or hell for SSC, client entities, it employees and its customers will be determined by these outcomes which can create salvation in sustainability or herald its downfall in the weeks, months and years to follow.

Credits/Sources;

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www.glazette.com

www.paulhypepage.com

www.stellendalepark.co.za

www.ibm.com

www.govopps.co.uk

www.martin-smith.biz

           

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Effective Process Management: The 'Cult of Process' V The 'Cult of Personality'

Does effective process management impair dynamic management decision-making???   

We all have grown up with regaling stories of leaders whom have left footprints on society’s journey that are celebrated for their enormity as much as their achievements. Steve Jobs, Nelson Mandela, Jalal-Ad Din Muhammad Rumi, Mahatma Ghandi and President Abraham Lincoln are all such individuals whom have impressed us and fit the bill as great leaders!

Its easy to forget that even as we stand on the shoulders of giants, those pivotal moments in our history were always fraught with issues that surrounded great people whose charisma seemed to be the salvation to our problems when in fact, their brilliance lay in their message that inspired a process which delivered a successful outcome in that moment. So in business, why is there an apparent clash between process and personality when it comes to ‘great leaders’ making decisions?

I would say firstly that great leaders are defined in hindsight for their character as much as their achievements, which just leaves leaders, their decisions and the outcomes. So, “why does effective process management inhibit great decisions by leaders?”

The short answer is “it should not!”… However, it can and does due to many reasons, which can include:

Process design can be overly burdensome curtailing leader effectiveness by removing or drastically reducing decision-making ability. This can slow up organisational responsiveness to market changes and can become an inherent threat to the company’s long-term interests. Conversely, process design that does not control leader authority through setting justifiable boundaries can expose the company in many areas due to bad leader decisions that go unchecked to implementation. Balance in process design on leader authority is key.

Personality of powerful leaders can override process compromising its integrity. Accordingly, it looses effectiveness when others see how one leader can be the exception to process driven rule(s) they should all follow. This is cancerous in large organisations where unmanaged and unaccounted for exceptions can grind process structures to a disastrous halt creating a new suite of costly problems and risks for the company.

Divergent priorities of leaders to the company’s best interests set out in processes can be catalyst for conflict between process control ‘enforcers’ and leaders; inhibiting the leader’s ability to execute a decision he or she feels is a great one. A key to great process management is internal business acceptance of the structures. An impacted leader not included in any stage of a process design or upgrade will be more likely to resist process requirements.

So thinking about some of the common pitfalls in business, what helps in combining great leaders with great processes producing great moments in time?

Who takes the lead? The process manager should establish roles and responsibilities in the project initiation (stakeholder analysis) stages of any process revision clearly linking company objectives for the process and/or processes to function(s), to leader(s) and other stakeholders. This should form part of the stakeholder engagement process.

Reconciling Objectives. The project manager should solicit feedback on the process vision presented to the stakeholders noting any variances and the reasons for same. Identified issues should be recorded and managed to resolution via a working risk register.

Defined Goals, One vision. This should be the mantra of all process stakeholders. Anything else endangers process and organisational effectiveness especially if the customer has to work harder to effectively complete the process.

Create value, not paperwork. If a process step does not create value in its execution, then it should not be there. If a process can work effectively without it, then it should be removed.

Process Controls should be sewn into process design, not placed on top of them. A process control should never add work; it should add value by being a critical part of the process sequence creating value in process delivery whilst delivering feedback relevant on the risk identified in the process control.

Manage exceptions or they will manage you. A balance between leader decision-making scope and process control needs to be found in business practice, which critically influences company culture in many unseen ways over time. Managing process exceptions with a clear lean process flow helps by allowing the company to map out the impact of approved exceptions in terms of their risks, opportunities and outcomes.

So considering the above, the ability for leaders to be earthed in a good process matrix truly can be positive for all concerned. Like all the greats whom have gone before, a leader’s vision indelibly linked to inspired process structures translates vision into accomplishments which history can judge as being great.

Source/Credits:

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www.macardlelegal.com.au

www.collinsbarrow.com

www.sportsconflict.org