This is the second in Forum Solutions’ four-part series: A Best Practice Framework for Launching an Enterprise Shared Service (ESS).

As we mentioned in the first part of this series, there is a trend toward the insourcing of specialized functions by establishing enterprise shared service departments (ESS).[1] Benefits of inhouse ESS teams include:

Global prioritization: A centralized team allows for prioritization, oversight, and visibility by the top executives. Deployment and resource allocation decisions can be made based on what is best for the entire organization rather than what may benefit one team at the expense of another. An interesting case study is to survey your organization for how many analysts are located locally within departments versus centrally within a shared service team and how an ESS might provide better ROI on those resources.
Increased credibility: Shared services are free to have an enterprise-wide perspectives not tied to a specific department or business unit. Often these teams are seen as being unbiased in their approach as they do not have a departmentally biased incentive driving their actions.
Cultural transformation at scale: Outside resources and agencies often struggle with long-term cultural integration and achieving the buy-in necessary to drive and sustain change. Inhouse ESS functions can establish and promote best practices across an organization (especially when framed as a Center of Excellence). This allows for the ESS to disseminate best practices so that the ESS can focus on the higher-value objectives.

Example Specialized ESS Development Scenario

Take the case of a company with a training program that developed organically within the product management division to support external customer needs. Customers would get trained by this team on new products and how to unlock more advanced product features of existing products. Once the company started to grow, the training team started getting internal requests from new staff on how to use the products they were selling. Eventually, the training team started to get requests on a variety of topics like how to get training on finance related reporting tools, conflict resolution, and effective meeting management. Once the scope and need began to grow beyond the original L&D mandate, there was opportunity to establish a global Learning & Development (L&D) shared service to support internal and external customers. In order not to balloon the size of the L&D team, they established a goal of becoming a Center of Excellence (COE). This way the L&D team could teach a department how to handle basic training tasks (registration, self-service training materials) so that the L&D staff can focus on higher level efforts like new curriculum development or more in-person training for sensitive and high-touch topics such as conflict resolution.

This case appears like a straightforward journey, but one should not underestimate the effort in successfully launching an ESS. It is important to thoroughly plan and get executive buy-in before designing, let alone deploying, a new shared service function. Even if transforming an existing team, there would need to be significant vetting before starting. Consider the example of L&D team moving from product management to a centralized shared service: Is the product team ok with this move? Who will the new ESS report into? Will the L&D team still be able to effectively handle the existing pipeline of customer training? How will this impact other department leaders and their staff?

Launching a new specialized ESS has many similarities to a new product launch. It is important to be able to articulate:

The value proposition for this new function: What problem is this new function solving and how big is the projected impact. For example, what is the return on investment?
The target “customer”: Who in the organization benefits from this new team?
The customer experience: How will stakeholders interact with this new function? What does that look like along the entire engagement lifecycle? How will this new function be operationalized?
The resources it will take to get started: What approvals and resources (e.g., FTE, Technology, etc..) will the department need to launch?

The main difference from an external launch is that the champions of ESS development are selling this “product” internally and will need to run the new “product” once approved. Figure 1 shows the main steps in the ESS sales and development framework.

Architecting the ESS: This phase includes planning the internal pitch, identifying key stakeholders, and designing the new ESS function.

Figure 1 High Level ESS Development Framework

Orchestrating the vetting roadshow: The roadshow is to solicit feedback, address concerns, and gain buy-in from key stakeholders and internal customers prior to the final approval presentation. Feedback gained during this phase will be incorporated into the ESS design and approach.
Final approval presentation: This stage/milestone involves receiving formal approval from the executives responsible for resourcing and participating with the new ESS.
Deploying the ESS: Best practices involveusing a phased roll-out approach and making sure to effectively communicate with impacted staff regarding the new function.
Managing the ESS & Monitoring performance: One is never done selling the new ESS function. Main activities include utilizing the governance structure, KPI reporting, and other vehicles to ensure the new high-performing function continues to evolve.

Now that we have covered the benefits of an inhouse ESS and the rigor required to develop one effectively, we will describe the details of the ESS development journey in the next part of this series.

Forum Solutions’ four-part series: A Best Practice Framework for Launching an Enterprise Shared Service includes:

Forum Solutions is a management consulting company dedicated to crafting and delivering transformational outcomes for our clients, our colleagues, and our community. With our help, clients become more agile, resilient, and connected, bringing great ideas to fruition with brilliant results. From start-ups to the Fortune 50, business leaders rely on Forum Solutions to help them form and realize their strategies. Our company is a certified Woman Owned Business that believes in developing and growing our colleagues, company, and region in a socially conscious way.

[1] 2021 Global Shared Services & Outsourcing Survey Report, Deloitte. https://www2.deloitte.com/nl/nl/pages/enterprise-technology-and-performance/articles/2021-global-shared-services-survey-report.html

A Best Practice Framework for Launching an Enterprise Shared Service (ESS): Part 2 of 4

A Best Practice Framework for Launching an Enterprise Shared Service (ESS): Part 3 of 4

A Best Practice Framework for Launching an Enterprise Shared Service (ESS): Part 1 of 4