Jason Laroche of Arvato offers his to-do list for local authorities wishing to get the most out of shared-services engagements
Service transformation has been on the agenda for central and local government since the start of the decade. But as the cuts have become increasingly severe, public-sector leaders have looked to more radical approaches to deliver the major savings needed to protect front-line services.
Sharing back-office services, such as HR, payroll, finance, and procurement across multiple government organisations offers significant potential to free up resources and is expected to play a key role in how services are structured in the years ahead. Programmes are already underway in central government and an increasing number of councils are partnering to deliver joint back-office functions.
To deliver success, both councils and central government departments must focus on schemes that offer standardised IT infrastructure, platform technology, and management processes, and secure the full buy-in of each participant to ensure that the planned economies of scale are achieved. With this in mind, there are three vital lessons public sector organisations looking to establish shared services programmes can learn.
- Appoint a strong leadership team
A successful shared services agreement is built on solid foundations and participants must establish a leadership team to channel each party’s objectives into a strong business case. Leadership needs to be central, credible and, above all, visible. At every level of the organisation, it should be clear who is making the decisions. This approach will anchor the programme from the outset, creating a central point of authority with a mandate to manage partners, speed up decision-making, and keep the scheme on track.
Together with ensuring buy-in, clear governance and accountability is critical to ensure that each government organisation has the opportunity to highlight their priorities and challenges from the outset and avoid any issues at a later date.
- Implement a flexible ERP solution
Merging services seamlessly and ensuring they can be delivered in a consistent, repeatable way, depends on stable, streamlined back-office processes running on a flexible enterprise resource platform (ERP) solution.
While new partnerships must identify, map and standardise processes as a first step, selecting the right software is a critical factor in lowering the risks and costs of implementation. The use of a uniform platform offers considerable benefits in terms of integration and alignment, but the selected software must still be the right fit for each organisation involved. Ultimately, solutions should support process improvements – not constrain them – and be future-proofed to deliver continuous value.
By offering a choice, government departments can configure software to their existing business models more easily and scale up their use quickly, while in-built analytics provide transparency without risking data security.
- Invest upfront in training and supporting staff
Public-sector organisations often concentrate on implementing technology and infrastructure, neglecting their end users – their employees. At their heart, shared services programmes are about reducing costs and making processes simpler, so ensuring the resources are available to get staff up to speed with new systems and help them understand the aim of the scheme can fall down the priority list.
Further investment upfront in training must be prioritised to maximise the benefits and ensure everybody pulls in the same direction. Without this, employees will be less engaged, their job satisfaction will suffer and, ultimately, they will struggle to provide the added operational value that shared services promise.
Successful shared services schemes offer significant potential to help government organisations tackle the budget pressures they face. But if they’re going to work, above all else, public sector leaders must wholeheartedly commit to the substantial organisational, operational and technological transformation that’s required to deliver the major savings on offer.