The Next Frontier of Shared Services: Program Summary

The Leadership for a Networked World Program hosted a custom executive education program entitled "The Next Frontier of Shared Services in the Public Sector." The program was supported by Accenture Consulting and Microsoft and focused on analyzing and developing strategies and tactics for shared services and the leadership skills needed to enable the sharing of information within individual organizations, across jurisdictions, and in multi-sector alliances. In attendance were over seventy senior practitioners and industry leaders from federal, state and local governments in the United States as well as senior leadership from Australia, Canada, Peru, Romania, and the United Kingdom. Together they worked on framing where the public sector stands today regarding shared services; where it might be tomorrow; and what action it can take, individually and collaboratively, to create public value.

 

Program Session Overview:

Participants worked through an intense two days of sessions including facilitated case discussions, plenary and jurisdictional group discussions, and topical practitioner sessions. Session highlights included:

 

• Case Sessions covered the dynamics of political management and governance, finance and funding, and the technology and tools of shared services and featured cases on the U.S. Grants.gov initiative, the consolidation of California’s email systems, and the development of the Iowa Recovery Center.

 

• Plenary and jurisdictional sessions included large group discussions on the challenges and opportunities of shared services and small group break-outs for federal, state and provincial, and county and local representatives. The small group sessions facilitated the sharing of knowledge on implementation issues within similar jurisdictions and developed ideas for ongoing collaboration on tools and training within a community of practice.

 

• Topical sessions featured senior executives discussing their current shared services implementations and covered an array of concepts including strategies for information technology, human resources, and financial services shared services environments as well as general strategies for portfolio management, funding strategies, and the adoption of innovative technologies.

 

Key Insights and Strategies from Program

Over the two day program participants generated a wealth of insights, strategies, outputs and questions to be further explored on shared services. The major themes for these insights were on ensuring effective political management and sponsorship, improving governance and operations, adopting new technical and service capacities, and creating an ongoing and persistent learning community.  Key insights, strategies, and next steps on these summarize as:

 

Ensure Effective Political Management and Sponsorship: When starting and sustaining shared services initiatives it is imperative to engage political and executive support across the entire spectrum of the authorizing environment. Key insights and strategies:

• Engage political appointees, cabinet, and key legislators – to ensure the support of the authorizing environment at all key levels. 
• Communicate vision and strategic objectives – to create a sustainable set of expectations and rationales for the feasibility of the initiative. 
• Assess the organizational change and impact - to anticipate pockets of resistance and to proactively distribute the gains and losses derived from the initiative.
• Manage dialogue with authorizing environment – to continually communicate the business plan and value of the initiatives and manage expectations as the business model is refined.
• Ensure executive sponsorship of the business model – in order to create a high level of understanding of the business model so that pivotal political and management levels can use authority to move the initiative during sticking points.

 

Develop Strategies for Finance and Funding: Shared services enterprises as a business model require precise investment plans, cost/benefit calculations, and pro-forma forecasts to ensure financial targets are met and to sustain the business model and authorizing environment. Key insights and strategies:

• Collect and improve cost assessment and benchmarking – in order to accurately gauge pre-shared services costs incurred and project costs and savings upon launching the shared services program.
• Develop financial operating models – to test assumptions and validate operating costs and financial measures within the shared services enterprise and to refine the service deliver model.
• Develop service delivery model – in order to optimize business processes and scale the shared services enterprise in a financially prudent way.
• Standardize accounting rules and procedures – in order to create an understanding among customers, sponsors, and authorizing environment on what true costs are both pre and post shared services and of baseline measures. 
• Develop financial tools within business case – to bring a level of transparency that sets clear financial measures (such as return on investment, payback, and internal rate of return) and reporting tools.

 

Develop and Improve Governance and Operating Model: A successful shared services enterprise has a governance and operating model clearly articulated in the business plan and modifies its governance, management, and sourcing as the maturity level of the enterprise advances. Key insights and strategies:

• Establish the form of governance and management – to create an effective environment that balances customers, executive sponsors, and operational management. 
• Develop human resources and sourcing plans – to maintain the operational ability of the enterprise and to enhance performance by continually optimizing the mix of capabilities it employs to execute the model.
• Develop and manage key performance indicators and metrics – in order to communicate the tangible and intangible measures of the enterprise and the tangible metrics derived from operations.
• Manage service adoption and migration – to balance and load the portfolio of services offered at any given time and to maintain the risk profile of the enterprise. 
• Assess the maturity of the enterprise – to match and modify     the governance, customer service levels, service offerings, and sourcing capabilities as the enterprise scales.

 

Develop and Implement New Technical and Services Capabilities: As a shared services enterprise matures, it is necessary to continually assess customer requirements and needs and to adopt new architectures, standards and tools, and service extensions that will keep the operation on the leading edge of providing value. Key insights and strategies:

• Assess and anticipate customer needs – to plan for capability planning within the enterprise on technical and personnel dimensions and to build customer insight and loyalty over time. 
• Seek new technologies and operating models – to match future customer needs with the capabilities of emerging technologies, new processes and reengineering tools, and deployment methods.
• Develop a test environment for new solutions – in order to refine new service offerings in a real-time system environment and prepare them for extension to key customer segments. 
• Plan the extension and scale of new service offerings – in order to optimize the migration approach, ensure customer satisfaction and metrics, and to maximize new revenue streams to the enterprise.  
• Reinvest efficiencies for continuing innovation – to form an ongoing method of fostering new ideas and innovations in an environment that can accommodate higher risk and experimentation.

 

Foster an Ongoing Learning Community: Communities of practice are groups of people informally bound together by shared expertise and a need for capturing and spreading ideas and know-how. A community of practice for shared services could help in ways such as:

• Develop strategies for creating shared services enterprises – by sharing insights around business planning, governance, financing, and technical tools.
• Solve community-wide problems quickly – by hosting a trusted set of community members that can interact with each other on an ongoing and as-needed basis quickly and effectively.
• Solve individual challenges and problems – by hosting “cases” on select implementations and enabling community members to offer advice.
• Develop community tools and kits – to facilitate the start-up and implementation of shared services initiatives.
• Create new benchmarks and best practices – to further the methods in which shared services enterprises can generate and communicate value to customers and stakeholders.
• Start new lines of business – by sharing ideas on what the enablers and barriers are within similar environments to seeking, planning, and launching new forms of shared services.
• Enhance professional skills and connections – by hosting regular forums and events and by managing a list of peers that can be accessed by community members.

 

Summary

The practitioners at this event agreed that government is increasingly facing the pressure of not only delivering more effective services to citizens, but also delivering services in a more efficient way. The combined impact has forced them to drive down the cost of government while developing innovative citizen driven services. Deploying a shared services business model is an integral step to moving toward a more client-centered, outcome-oriented, accountable, and efficient service delivery system – and ultimately creating more public value. Improvements in information infrastructure and business process reengineering are opening up opportunities for delivering shared services in government that are simultaneously more efficient and effective. It can be a win-win situation, but requires sound judgment and leadership to effectively implement the new possibilities and to create a high-performance environment.