Jan Duffy's Speech during Innovation Forum 2009 in Milan

1. The Shared Services
Experience – The UK and
Canada
Jan Duffy
Research Director
Government Insights EMEA

2. Agenda
 Four driving forces
 Understanding shared services
 Major shared services trends
 Shared services enablers and inhibitors
 Some interesting shared services examples
 Essential Guidance
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3. Four Driving Forces in 2009
Investment optimization Government modernization
– reduce IT costs while – improve overall efficiency
improving IT capability and effectiveness of financially
and capacity challenged governments
Demonstration of Contribution to long-term
leadership – economic well-being –
demonstrate leadership stimulate economic
expected by citizens in improvement through various
this difficult period programs and new priorities
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4. Transformation’s Value Proposition
 Improved service: Citizens want simplicity
 Improved efficiency: Governments must drive down costs
 The barriers:
– Fragmented processes
– Disjointed organizational structures
– Lack of technological interoperability
 Considerations:
– Shared processes
– Shared information
– Shared IT solutions
Shared Services
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5. Agenda
 Current driving forces
 Understanding shared services
 Major shared services trends
 Shared services enablers and inhibitors
 Some interesting shared services examples
 Essential guidance
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6. What is a shared service?
 Combines a set of common services and
functions
 To serve multiple business units
 Under a single governance structure
 Using standard business processes and
supporting technologies
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7. Shared services framework
Shared Services Shared Services
Lifecycle Delivery Models
Strategy/Feasibility
Detailed Design
Implementation
Joint Venture
Optimization
Outsource
In-house
Client Facing (Front Office)
Services/Functions
Corporate/Enterprise (Back Office)
Information Services
Technology and Infrastructure Services
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8. Shared Services is about…
 Innovation in operating models – governance, economic
and business
 Transformation of ICT to a culture of service and
performance
 Optimization of technology and business investments
 Standardization of business processes and technology
 Collaboration -- combining internal productivity with better
services
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9. Collaboration -- combining internal
productivity with better services
Creating centers of excellence (i.e. shared services
center) that deliver services on behalf of multiple
Sharing processes
government agencies
Joining up information flows and basis of data
across levels of government, front and back office,
Sharing information
siloes of activities
Leveraging consolidation, and virtualization to
Sharing IT solutions free-up resources for innovation and SOA to re-use
services across application siloes
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10. Shared services lifecycle
 Strategy and feasibility –
getting this right increases
Shared Services Shared Services
the chances of a
Lifecycle Delivery Models
successful implementation
Strategy/Feasibility
Detailed Design
Implementation
Joint Venture
Optimization
Outsource
In-house
 Detailed design and
implementation – these
two stages represent the
greatest time and
Client Facing (Front Office)
investment – good project
Services/Functions
management is essential
Corporate/Enterprise (Back Office)
 Optimization – an
Information Services
increasing area of concern
Technology and Infrastructure Services
and interest
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11. Shared services delivery models
 In-house – the most
favoured business model
Shared Services Shared Services
Lifecycle Delivery Models
 Joint venture – still
Strategy/Feasibility
relatively immature,
Detailed Design
Implementation
Joint Venture
Optimization
Outsource
In-house
increasing consideration
as an alternative to
outsourcing
 Outsource – very popular
Client Facing (Front Office)
Services/Functions
alternative
Corporate/Enterprise (Back Office)
Information Services
Technology and Infrastructure Services
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12. Shared services – services and functions
 Client Facing (Front
Office) – Contact services,
Shared Services Shared Services
Lifecycle Delivery Models
 Corporate Services (Back
Strategy/Feasibility
Office) – Finance, HR,
Detailed Design
Implementation
Joint Venture
Optimization
Procurement, Asset
Outsource
In-house
Management, Payroll
 Information Services –
Common repositories,
federated databases,
Client Facing (Front Office)
Services/Functions
performance reporting
Corporate/Enterprise (Back Office)
 Technology and
Information Services
Infrastructure Services –
IT infrastructure, IT
Technology and Infrastructure Services
operations, application
development
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13. Agenda
 Current driving forces
 Understanding shared services
 Major shared services trends
 Shared services enablers and inhibitors
 Some interesting shared services examples
 Essential guidance
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14. Major shared services trends
 Strong growth is expected to continue, but interest,
appetite and urgency varies
 Drivers are achieving economies of scale, aligning IT at the
enterprise level, specialized centres of competence
excellence
 Increasing interest in client-facing shared services – bigger
potential return
 Consideration of innovative sourcing models is growing
 Success/failure record is uneven
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15. Agenda
 Current driving forces
 Understanding shared services
 Major shared services trends
 Shared services lessons learned
 Some interesting shared services examples
 Essential guidance
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16. Shared services lessons learned
 Shared services are difficult to implement
 Sustained leadership/commitment is equally as important
as good management
 Working horizontally does not come naturally
 Confidence in the system leads to increased use and
optimization
 Focus must balance improved service with cost reduction
 People issues must be dealt with
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17. A few examples of UK Government
Shared Services
Organization Background Comments
 Large scale back office services
Department for In-house centralized Shared
Transport (UK Central Service Centre to provide the
 Original plan proved to be unrealistic and
Government) Department its executive agencies
overly optimistic
with HR, payroll and finance
services  Efforts to capitalize on the shared services
investment continue
 Poor service record historically
Department for Shared Services organization
Environment Food and created to support a number of
 Challenges experienced in the early stages
Rural Affairs (UK Central divisions and related agencies in
Government) finance, procurement and IT
 Janet’s success was recognised by winning
UK Further and Higher JANET is the network that
Education Funding connects the UK's education and the shared services category of the e-
Councils (JISC) research organisations to each Government National Awards 2007 – the
other, as well as to the rest of the award recognizes proven shared services
world through links to the global that have delivered effective services and
Internet. In addition, JANET efficiency gains
includes a separate network that is
available to the community for
experimental activities in network
development.
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18. A few examples of Canadian Government
Shared Services
Organization Background Comments
 Large scale citizen services
Service Canada/Service Canadian federal and provincial
BC examples of a “whole of
 Mature, but continuing to evolve
government” citizen service
delivery organizations  Voluntary participation
 Includes finance, procurement, IT, HR,
Government of Alberta, Objective: to transform the way it
Canada delivers financial services and payroll services
human capital management
 Achieved predicted cost/benefit returns and
services to its 24,000 employees in
a high level of satisfaction
the more than 22 ministries and a
number of boards and agencies
 Focus on Supply Chain Management
Southeastern Hospitals, 3SO was created by six healthcare
Ontario organizations in SE Ontario as a
 Underpinned with a common ERP platform
shared services initiative to
develop a regional integrated  Goal is to reduce costs, leverage best
supply chain management model practices, and maximize resources –
in order to optimize the use of ultimately to help lower healthcare costs
funds for medical supplies, and improve patient care
services and capital equipment and
drive continuous adoption of best
practices in supply chain
management among the area
hospitals
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19. Agenda
 Current driving forces
 Understanding shared services
 Major shared services trends
 Shared services lessons learned
 Some interesting shared services examples
 Essential guidance
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20. Essential Guidance
 Demonstrate to all staff how shared services will benefit the
organization as a whole and employees as individuals and
customers/citizens
 Be realistic when planning the implementation schedule and
anticipating returns
 Gather baseline performance data prior to implementing the shared
services model
 Engage closely with prospective shared services users prior to
implementation
 Transfer individual businesses and processes to shared services
incrementally
 Remember that some of the biggest returns may be in customer-
facing processes
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21. Questions...
Jan Duffy
Research Director, EMEA
Government Insights
jduffy@government-insights.com
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