News article

Posted by Rachel Fielding PM | on Mon, 27/02/2012 - 10:33  1192

KPMG: don't blow your shared services move with too fuzzy goals

Organisations that neglect governance issues when moving to shared services or outsourcing arrangements may “hinder their business goals,” consultancy KPMG has warned.
Ron Walker, an internal shared services and outsourcing specialist at the firm, told the Procurement Leaders Network that problems commonly arise because companies fail to establish a service delivery governance structure from the outset.
"Unfortunately, organisations fail to realise how important service delivery governance is to the relationship’s overall success. What often happens is that organisations conduct ad hoc reviews, and therefore, by the time they identify problems, cost and value leakage can be substantial," Walker said.
Despite the benefits of a planned and managed approach to service delivery governance, Walker warned that many organisations find managing the governance function to be time-consuming, repetitive and expensive, with governance costs increasing year-over-year.
In those cases, Walker advised, the preferred option is to pursue managed governance services: "By assigning governance functions to an expert, organisations can receive more effective service delivery governance at a lower cost.

A recent poll of 100 local government and social housing service directors and IT managers highlighted growing acceptance of involvement in shared service strategies (89%), up from 52% in the previous year and 24% in the 2010 study