Part 3: Architecting and Vetting the new ESS

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

In the previous segment of this series, we highlighted the reasons for an observed trend in developing in-house specialized Enterprise Shared Service (ESS) departments and an overall framework for establishing an ESS. We will now cover the architecting and vetting phases of the ESS development framework:

Figure 1 High Level ESS Development Framework

Architecting the ESS

Development of a shared service function starts with a concept, an executive sponsor, and a champion. The executive sponsor helps get organizational buy-in and resources for the ESS concept, and the champion designs and operationalizes the new function. The sponsor and champion will make up the nucleus of the core working team for development, approval gathering, and resulting roll-out.

Development of a new ESS can create anxiety among staff if not approached properly. Anything new, especially if it impacts one’s workflow, can be perceived as threatening. Therefore, it is imperative before beginning ESS development to have the approval of the champion’s leadership and executive sponsor. Then a discrete core working team can be formed to begin more broad approval planning and department architecting in parallel. Once the team is formed, the first step of this process will be to design the new function. There are many important key activities steps in this phase, so it is important not to underestimate the effort it will take:

Figure 2 Key Architecting Phase Activities

1. Define the value proposition and justify the investment. There are innumerable demands on the scarce resources of an organization. A compelling and executive ready “elevator pitch” and call-to-action will be critical for setting the stage:

What is the value-add from this new function? What problem does this new function solve?

Pro Tip: Avoid introducing an additional enterprise “tax”. Most shared services do not directly generate revenue, so they are often seen as burdensome cost centers by detractors, making the ESS vulnerable when times are lean. However, one could make the argument that these services are not typically generating revenue whether they are located within another department or are a centralized team. An effective way to counter this concern is to repeatedly demonstrate value-add by building in value reporting to the decision makers funding this new function.

What is the scope of this team? It’s important to reduce fears of a power grab. Having a limited scope, staffing, and resourcing will increase the initial ROI while minimizing any perceived over-reach by the new function.
Why should the executive leadership back and support this function? How will the leadership reinforce cooperation by their teams and intervene when necessary?
How does the enterprise and all the internal stakeholders benefit from this new team? As these new departments tend to be cost centers, providing an ROI/NPV will help support justification for the program.
Who will prioritize the work of this new shared service and how will they do so?
Why now? Typically, organizations have already tried solutions to the issue you are trying to solve. Why will this be different, and why do this now?
What defines success for this new function? Consider the key performance indicators (KPIs) that you will use to report out on how well the new department is meeting its goals. After a successful engagement by the shared service, what is a tangible measure of success? Increased revenue? Decreased costs? Cost avoidance (especially for risk management functions)?
Consider process measures to show how much volume the shared service will support. These measures can sometimes be leading indicators for the outcome measures. Examples include number of projects completed'; number of training sessions facilitated; number of successfully completed; or number of ESS requests processed.
What resources will be necessary? Given the goals, objectives, and scope of the team, consider the staff, processes, equipment, space, and technology necessary to be successful. A full business plan is not always necessary but can be a helpful framework.

2. Identify key audience members. The typical mandate for most shared services spans multiple members of the C-suite, so it will be important to get approval across a variety of stakeholder groups to launch this new function. Work with leadership and the executive sponsor on how best to pitch this new service (typically at an executive leadership meeting using a well-crafted presentation). Best practice for any presentation is to vet and solicit feedback from key decision makers for incorporation before the final delivery.

Pro Tip: Address your key stakeholder’s concerns. Directly tie value proposition elements to the current needs and priorities of the organization and executives you are selling to. If the new function can help the executives solve their problems, and help drive enterprise strategic/mission objectives, be sure to frame it in that way.

Who needs to approve this? Conversely, who could block this? This group should include the executive sponsor, the champion’s chain of command, and those who will fund and provide budgetary support for the new team. Can you proactively mitigate the concerns of those who can block this effort by incorporating their feedback into the shared service design?

Whose help will be necessary to be successful? If the new function requires a multidisciplinary partnership approach (finance, marketing, and human resources) then make sure to discuss the plan with the supporting teams. Top concern for the partners will be staff time commitments and other engagement expectations.
Who will be impacted by this team? Who are the customers? If the future department is providing advisory services, interviewing potential customers, and asking for input can help inform the architecture of the program (see below). It can also be a good litmus test for how excited the potential customers will be of the new service.

Pro Tip: Consider the loss of control. When local resources are taken to form a centralized team, home departments can feel a loss of control and access to these resources. You can imagine that in the L&D example, the product management department would be disappointed about no longer having total control over their resources and scope of work. Therefore, it is imperative that impacted departments feel included in the decision and aware of how to continue to have access the resources.

Figure 3 Shared Service Engagement Experience Lifecycle Framework

3. Map the ESS engagement lifecycle. An engagement experience journey map and associated value proposition will be key when meeting and vetting with key stakeholders. An experience map is a high-level visual “journey” of what a typical ESS engagement model looks like (from intake to completion). If the shared service is performing a standard cyclical process, rather than taking on ad-hoc work, that cycle should be mapped out as well. The journey includes key operational steps, phases, and timing, cross walked against associated stakeholders, technologies (e.g., SharePoint, CRM), KPIs, and templates. A sample framework is outlined in figure 3.

Pro Tip: Avoid creating bureaucratic burdens. If not designed effectively, the shared service can be bureaucratically heavy in the approach to intake and prioritization. A common example is a Project Management Office that takes 2-3 months of documentation creation and governance review to get past the intake phase. Keep the workflow lean and you’ll have greater success in selling and maintaining the ESS.

When mapping out the initial experience, it is preferable to have a phased roll-out: near-term, medium-term, long-term. For example, the near-term goal could be proof of concept, while the medium-term goal could be “hard-wiring” (or fully establishing) the new function, and the longer-term goal is driving innovation and deploy advanced technology and infrastructure to improve effectiveness.

Consider sustainability when crafting the journey. Any new ESS experience that impacts other stakeholders will need to be simple to understand and be process/documentation light. Designing streamlined shared service interactions that reduce future burn-out (highlight this on your journey map!) will help sustain buy-in from your stakeholders and future customers.

4. Roadmap the deployment plan. Plan the launch into phases and document key activities in a multi-year roadmap.

5. Utilize a governance body. Establishing and launching a multi-disciplinary governance body is an effective way to reinforce a neutral disposition for the shared service. This group will provide oversight, accountability, and an escalation pathway for the new function. The meeting frequency of the governance body is dependent on the membership and urgency of the issues being addressed, but at minimum, plan for quarterly review of current and past activities and KPIs

6. Mock-up expected:

KPI Reports: For the measures of success described previously, start considering data sources and reporting frequencies. Where will these measures come from and how often can they be updated?
Templates and other associated documentation (including a centralized SharePoint site to facilitate document storage and collaboration.

7. Have presentation ready materials for everything. Get comfortable with creating visuals and tight narratives: it is valuable to create a presentation ready version of your design materials for inclusion in the roadshow and approval presentations.

8. Vetting roadshow

Soliciting feedback and addressing concerns from stakeholders is mandatory before a final “Go-No go” pitch. Do not underestimate the work entailed with a vetting roadshow before giving a final pitch presentation. Here are some steps to work through with your working team:

Confirm the final pitch date and accordingly plan all your subsequent activities
Work back a week prior to the final pitch for delivering a final version of the presentation
List the necessary stakeholders & final pitch attendees
Schedule meetings with all the stakeholders (starting with core team chain of command and more critical audiences first) to account for potential multiple rounds with certain stakeholders and time to incorporate feedback into your materials between stakeholder meetings
Get a sense of the amount of time for the final pitch. A good rule of thumb is 1 slide per minute with executive audiences. If you’ve done enough vetting, the number of interruptions and follow-up questions should be minimized but be prepared to have detailed supporting exhibits in the appendix

A final presentation will organically develop as a tight pitch is being developed throughout the vetting process. These first two stages of ESS development (Architecting & Vetting) are critical in the successful launch of a new ESS, so be sure to plan for enough time and effort dedicated to doing so. However, if done well, the rest of the process is relatively straightforward. In the next and final segment of our series, we’ll cover the final presentation, launch, management, and some final thoughts.

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

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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 4 of 4

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