Shared Services Agreement Definition



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Internal customers must then indicate their own service requirements. Suppliers must meet their requirements and suppliers will have their performance evaluated on the basis of easily measurable specific criteria. If properly executed, the shared services approach takes advantage of the benefits of centralization and combines it with decentralization. The difficulty of this argument lies in the fact that coastal and offshore proximity models are generally associated with the outsourcing model and are difficult to resign themselves to the notion of in-house shared service, unlike an outside service. It is clear that the use of offshore facilities by a government department is not an example of common services. Shared services are different from the outsourcing model, in which an external third party is paid to provide a service that was previously internal to the purchasing organization and which usually results in layoffs and reorganization. There is an ongoing debate about the benefits of shared services over outsourcing. [2] [3] [4] [5] It is sometimes assumed that a joint venture between a government authority and a commercial organization is an example of a common service. The joint venture involves the creation of a separate legal entity (jointly owned by companies) that provides profits to its shareholders. There are six main principles that will guide your business in the process of implementing the Shared Services Agreement. Many large companies, both public and private, are now considering using ECM (Enterprise Content Management) technology as a shared service. There are reports of common service centres to the UK government that have not achieved savings, such as the Department of Transport project, which Parliament`s Public Finance Committee describes as „great incompetence“. [11] Don`t reinvent the wheel when writing your contract.

Use existing models when designing your contract. There are many options that you can use for your common services agreement. Shared services are not limited to centralizing or consolidating similar activities on the same site. Joint services may mean that these service activities are carried out as a business and that services are offered to internal customers at quality costs and schedules that are competitive with alternatives. The UK government is working on a comprehensive plan to implement the benefits of common services as part of a central efficiency research, which follows the Gershon`s assessment. The firm`s office has set up a team specifically to accelerate and consolidate the reception and development of the strategy for all government services. The potential savings from this transformation in the UK public sector were initially estimated by the firm`s office at $1.4 billion per year (20% of the estimated cost of human and financial functions). In its November 2007 report,[10] the National Audit Office (UK) indicated that the $1.4 billion did not contain a clear cost base and contained several uncertainties, such as the initially required expenditures and the timing of savings.



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