In simple terms a party wall divides the buildings of two owners with the boundary between ownerships usually, but not always, positioned at the centre of the wall. A wall that stands astride the boundary of land belonging to two (or more) different owners. A wall that stands wholly on one ownera€™s land, but is used by two (or more) owners to separate their buildings. It is possible to easily find, through surveys and participation in forums, the Shared Services concept and ways of evolving the SSC at companies that already have it as part of their structure.
This article will address the elements of a SSC Implementation Methodology, from the creation to the implementation of the full Shared Services concept.
The Methodology divides the implementation of a SSC into three waves preceded by a Feasibility Study, which can be called “phase zero.” Wave one is Management Consolidation, wave two is Housecleaning and the final wave is Demand Education. The first objective of the Feasibility Study, as the name itself indicates, is to analyze the feasibility of implementing the SSC at the organization based on technical, financial and cultural aspects.
Detailing the Feasibility Study a bit further, its first delivery is the identification of the candidate processes for the future SSC. The relationship between the candidate processes and the SSC should be used to perform the feasibility analyses from financial and technical aspects. The financial gains of the processes in SSC must be estimated for each candidate process and may be of three different types: gains of scale and management consolidation, improved process compliance and demand education These three types are well aligned with the future three waves of SSC implementation. During the identification of the candidate processes for the SSC, it is important to identify the individual currently responsible for their execution, whether the Business Units or Corporate area.
A second and important element to consider under the aspect of centralization is the reduction of the overhead necessary to execute the processes. This management consolidation can be obtained also in processes executed by the Corporate area that come to fit within the scope of the SSC, if organized in an integrated fashion with those processes with a strong interface before executed by the Business Units. To decide on the centralization of a process, it is necessary to analyze how its transactions – before performed entirely at the Business Unit – will be requested from the SSC and executed remotely, initially without the same availability of information as granted to the former transaction executor. In order to perform the technical feasibility analysis, it is necessary to calculate the availability of technologies and media, the maintenance cost estimates and investments.
At heavily decentralized organizations, the gains with management consolidation alone already financially justify the SSC.
Accordingly, it is crucial to map out opportunities for improvements and process compliance with the implementation of the SSC. The last dimension of feasibility to be analyzed during phase zero is the cultural dimension.
The first wave is the Management Consolidation, the phase during which the processes are centralized to obtain gains of scale and the first increases in productivity are seen at the organization. In this sense, there must also be a discussion about this first wave, about the rhythm and sequence of the redesign and the consolidation of the processes at the SSC. These strategies are two extremes of a complex choice upon which SSC managers must base their own implementation strategy for their Organization. The second wave, called Housecleaning, is when the processes are stabilized and the improvements – in addition to those obtained during the centralization – are implemented. A good implementation plan permeates all of the three phases, taking into consideration the organization’s cultural aspects.

Breno Sarcinelli Jacome is a Managing Partner at Visagio with experience implementing shared services at different Brazilian organizations.
Sobre a VisagioA Visagio e uma empresa de consultoria e desenvolvimento em Engenharia de Gestao, com atuacao em mais de 15 paises e escritorios no Rio de Janeiro, Sao Paulo e Londres.
About VisagioVisagio is a business consulting and information technology firm, specialized in operations strategy, process engineering, organization design, and supply chain & logistics optimization, with offices in Rio de Janeiro, Sao Paulo, London and Perth. Melhores Empresas Para se trabalharVenha fazer parte de uma empresa parceira de seus clientes e que acredita no seu potencial. Great Place To WorkCome be part of a company that is the partner to its clients and which believes in your potential.
Examples include walls separating terraced or semi-detached houses or walls that form the boundary between two gardens, known as a a€?party fence walla€? (see more detailed description below).
Examples include where one neighbour has a structure that leans against a wall that is owned by the other neighbour. As well as the party walls described above this term encompasses dividing structures such as floors or other partitions.
It stands astride the boundary line between lands of different owners and is used to separate those lands. This question should be answered by the managers who will lead the Shared Service Center (SSC) implementation process at your organization. However, the question “now what?” for those who do not have a SSC implemented remains unanswered. We hope that a brief description of the phases of implementation of this Methodology, with an enhanced focus on the initial phase, can help orient managers in the sense of identifying the first steps for initiating the SSC at their companies. The contact with other companies and market experiences can be used to identify the functions traditionally present in a SSC, such as purchases, financial, personnel administration and IT, with the SSC traditionally responsible for completing the transaction processes of these functions. The processes for which corporate is currently responsible do not usually present gains of scale by themselves.
It is possible, for example, for each Business Unit to have its own Personnel Department Supervisor or Financial Supervisor.
For example, the consolidation of the time cards at all Business Units with payroll processing can have an integrated and consolidated management.
However, it is hard to convince the Business Unit to let go of its processes if we do not present other forms of benefits, which are often qualitative. Some of the benefits found at organizations with SSC include: national consolidation of supply agreements, reduced errors when calculating the taxes withheld for suppliers, reduced overdue payments, reduced default, increased accuracy in payroll processing, improved responses to employees’ questions regarding benefits, improved effectiveness when resolving IT inquires, reduced compliance-related risks and reduced audit points, among others.
Demand Education is the rationalization and planning of the requests for the SSC that happen after implementing the cost transfer model between the SSC and Business Units. The organizational culture in of itself is not capable of hindering the SSC feasibility analysis, but it directly influences the implementation plan. In order to facilitate this work, I will quickly go over the three waves of SSC implementation that take place after the executive approval of the Feasibility Study. It is possible to conduct a Big Bang implementation, in which the centralization will take place during a single process for all Business Units at the same time, or an implementation through Incorporations, in which the redesigns and consolidation take place at a single Business Unit each time, although with all processes simultaneously. During this time, there is an increase in the quality of the services provided by the SCC and new productivity gains.

It is during this time that the Service Level Agreements are established and the Business Units begin paying for the SSC operation costs. If you follow the Methodology presented in this article, this implementation plan will be divided into three waves: Management Consolidation, Housecleaning and Demand Education. The majority of the companies that take part in discussion groups about SSC have already completed the initial implementation phase and the focus of their discussions is generally on the future of already existing SSCs. This second objective can be understood as a means for reaching the first, since the financial benefits of the SSC can be obtained more quickly or slowly, depending on the implementation plan. I say “traditionally” because there are innovative SSCs that surpass the limits of this rule and already perform non-transactional processes. The processes that fall under the responsibility of the Business Units, on the other hand, present a high potential for savings of scale. With the implementation of the SSC, the number of supervision positions at the organization is reduced due to the unification of the work force into a single center.
For this phase zero, that of the Feasibility Study, we recommend that you not develop detailed redesigns, but rather focus only on the concept of feasibility. This concept is discussed extensively in forums and articles, considering that many organizations that have the SSC in their structure did not evolve the model for this level of management and plan to do so. The organizational culture is the main driver to consider when opting for a longer implementation with fewer process ruptures or a more expressive one with a higher number of ruptures. Nevertheless, the organization’s SSC still behaves like a mere centralization of activities, without granting autonomy to the internal client. The Benchmark Shared Service Model units the costs per process transaction with the Service Level Agreements through a service model similar to what an external supplier would use.
It is more difficult to find discussions about the initial phase of the SSC implementation, a moment at which the processes are still under Business Unit management.
The real detailing will be performed during another phase of the project, one that follows the Feasibility Study and only for those processes that are approved. In this sense, considering all of the gains of scale and process improvements calculated and, which in of themselves, make the implementation of the SSC feasible, it is common for organizations not to include this benefit in the Feasibility Study. We are talking, therefore, about the change management plan, and as it seems, this plan directly influences the project schedule.
The true Benchmark Model, which promotes a new organizational culture marked by conscious planning and savings, will only happen during wave three.
It is the professionalization of the services provided by the SSC through a new relationship model for use with internal clients.
By any means, it is common to see managers’ reports, after implementing the full concept of Shared Services at their organizations, citing that the gains with Demand Education surpass the gains obtained by the rest of the Feasibility Study. However, if we do not consider the aspects of organizational culture and the due change management plan, the organization’s resistance is capable of halting the implementation of the SSC, making the project financially impossible or even weakening its credibility.

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