Planning Expansion and Adding Scope to your Current Shared Services Operation

2011

HR Shared Services Expansion

SSON Shared Services Learning Series

Copyright © 2011 by ScottMadden. All rights reserved. 1

Agenda

I. About ScottMadden

II. Expansion is Good

III. Service Expansion Strategies

IV. Executing the Service Expansion

I. About ScottMadden

Copyright © 2011 by ScottMadden. All rights reserved.

Improve Design Build Decide

About ScottMadden

3

Our Functional Expertise

• Strategy

development and

integration

• Benchmarking

• High-level

business case

• Change

management

• Process

improvement/cost

reduction

• Operations/

technology

assessment

• Benchmarking

• Customer and

employee surveys

• Change

management

• Service expansion

Finance &

Accounting

Human

Resources

Supply Chain

Management

Information

Technology

Real Estate &

Facilities

Multi-Function

Engineering

Services

Administrative

Services

Design

• Service delivery

model

• Detailed current

state, future state,

and business case

• Sourcing model

• Organization

design and staffing

• Change

management

Build

• Project planning

and management

• Service/transaction

center

• Process redesign

• Technology design,

selection, and

support

• Change

management

II. Expansion is Good


Benefits of Shared Services

5

Reduce Cost (20% to 50%)

Companies can achieve all three, but can design for quicker results on any one.

• Aligns skill set with work type

• Eliminates redundant labor

• Tracks service usage/costs

• Economies of scale

• Automation of processes

• Data centralization

• Improved reporting & analytics

• Improved compliance

• Better decision making

• Focuses on demand mgt.

• Standard Processes

• Issue tracking & closure

• Performance Metrics

• Common model for expansion

Gain Control & Leverage Data

Control Cost

Improve Service & Enable Scalability


Advantages and Disadvantages of Growth

Advantages of Growth

The shared services model works

— Improves service delivery

— Lowers total costs

Economies of scale

Synergies (e.g., on-boarding of new employees)

Standardization of processes and elimination of redundant processes

Shared technology

Shared management and administration

Cross training

Additional advancement opportunities for shared services employees

Improved customer service

— Contact center

— Key account management

Allow business units to focus on core processes

Disadvantages of Growth

Investment requirements—up-front costs to transition and centralize technology, staff, equipment, and facilities

Additional bureaucracy

Size can hamper responsiveness

Requires broader technical expertise at the top to manage additional functions

Perception of kingdom building

Potential impacts to employees currently performing the work

6

III. Service Expansion Strategies


Expansion Strategies – Horizontal vs. Vertical Growth

Horizontal Growth

Additional customers

Additional business units within each company

New geographic areas

— New states, regions, countries, etc.

— Global shared services centers

Support to other companies (external sales)

Chemistry General

Supervisor

Shift Techs

Plant Chemistry

Supervisor

Chemistry Technical

Services Principal

Chemist

Chemical

Analysts

Nuclear Operations Manager

Waste Management

Supervisor

Rad Waste

Shipping

Environmental

Vertical Growth

Additional services

HR services

— Recruiting support

— Training and development

— Labor relations

— Vendor management

— Relocation support

— Travel & expense reimbursement

HR Information Technology support

— HR applications support

— HRIS report requests

Cross-functional services

— Litigation support and coordination

— Communication services

— Environmental, health and safety

— Regulatory compliance

— Real estate

— Facilities


Vertical Growth – Adding New Services

Use a standard process and tools to evaluate and justify the addition of future services

— Analysis should include alignment with strategy, resource impact, impact on call quality (e.g., average speed to answer), ability to leverage the service among all customers

— Set necessary sign-offs required to add a service

Set standards to which candidate processes or services must adhere

— Typically, the service center will want an incoming process “cleaned” to a certain level before it assumes responsibility

The service requestor should include the following with each new service request:

— Submitted by

— Describe the proposed service or services to be transitioned and provide the appropriate process flows (current and proposed future state)

— Current service owner (function, name, title)

— Positions performing the work today (position titles, FTEs)

— Customers of the service (who and number of customers)

— Systems or technology used to perform the service today (list and describe how used)

— Current performance measures used (list and note current performance)

— Current work volumes

— Describe nature of work volumes (steady, cyclical, peaks, etc.)

— Proposed timing for transition of service to SSC

9


Vertical Growth – Adding New Services (Cont’d)

The service is provided to more than one business unit

1 = More than one business unit

2 = Most of the business units in the company

3 = All of the business units in the company

The service is transactional in nature

1 = Work is non-transactional

2 = Some people doing similar, repetitive tasks

3 = Many people doing similar, repetitive tasks

It is not core to the business unit

1 = Function is considered a core operation

2 = Function is not a core operation

Service satisfaction level

1 = Business unit customers are fully satisfied with current service levels

2 = Business unit customers are somewhat satisfied with current service levels

3 = Business unit customers are dissatisfied with current service levels

EH&S

Training

Bonus

Admin

Vendor

Mgmt.

Change management impact

1 = Significant change management is required

2 = Some change management is required

3 = Minimum or no change management is required

Overall effort to implement

1 = Complex implementation (months to implement)

2 = Simple implementation (weeks to implement)


Vertical Growth – Adding New Services (Cont’d)

Track the new service requests that have been submitted to the shared services center

Assign scores for each of the evaluation criteria

Sum the scores and prioritize the expansion opportunities

Determine the services to include in the shared services expansion

Execute the service expansion!

Service

reach?

Transactional

in nature?

Core to the

business?

Current

satisfaction

levels?

Change

management

impact?

Overall

effort?

Total

Score

1 Service award vendor administration 3 3 2 3 3 2 16

2 Severance / separation packet creation 3 3 2 2 1 2 13

3 Tuition reimbursement administration 3 2 2 2 1 2 12

4 Bonus administration 3 3 2 2 1 1 12

5 Leave of absence management support 3 2 2 3 1 1 12

6 New hire orientation tracking 3 1 2 3 2 1 12

7 Professional licensure / exam administration 3 1 1 3 1 2 11

8 Contingent worker (contractor) administration 2 3 1 3 1 1 11

9 Code of conduct training administration 3 1 2 1 2 1 10

10 Environmental health & safety reporting 1 1 2 3 1 1 9

HR Shared Services Expansion Tracking Tool (Example)

Candidate Services / Activities

IV. Executing the Service Expansion


Key Steps to Executing the Service Expansion

Step 1: Establish a baseline – Current State

Consolidate all current state processes included in the new service request submission

Review the technology used to perform the service today

Evaluate the current organization design / staffing levels

Determine the costs required to perform the service today

Step 2: Identify improvement opportunities – Future State

Document process improvements / improved use of technology

Identify Service level improvements

Demonstrate organizational streamlining where available

Estimate cost savings for implementing the new service

Step 3: Develop the business case

Identify stakeholder groups and design communications and change management strategies for each group

Clearly document and communicate the assumptions underlying the business case

Continue to update the business case as facts and assumptions change

Include both quantitative and qualitative support


Key Steps to Executing the Service Expansion (Cont’d)

Step 4: Develop the service transition & training plan

Determine what activities move, what activities stay and the

timing of the transition (Stop / Start / Continue plan)

Include training topics for future state

— Operational process changes

— Telephony / IVR training impacts

— Case management impacts

— HR portal or knowledgebase updates

Identify training audiences

— Service center Directors and Managers

— Service center representatives

— HR Business Partners

— Centers of Expertise

— Employees and managers

Align training timeline with the service expansion timeline

— Training preparation

— Business simulation

Hire and train new personnel

Begin transitioning work


Step 5: Measure the results

Perform on-going measurement of customer satisfaction

Monitor stakeholder satisfaction

Track and report metrics performance

Update the business case

Take corrective actions where performance falls short

Celebrate successes!

15

Key Steps to Executing the Service Expansion (Cont’d)


For more information on Shared Services Expansion, please contact us.

Contact Us

Benjamin Foster

Managing Associate ScottMadden, Inc.

3495 Piedmont Rd, Bldg 10

Suite 805

Atlanta, GA 30305

Phone: 404-814-0020

[email protected]

mailto:[email protected]

Documents

Planning Expansion and Adding Scope to your Current Shared Services Operation