Public Sector Shared Service Models

Shared Services Advice from Current Situation Assessments to Innovation and Improvement

Peak Performance Technologies' shared services advisors can help you assess an existing shared services solution, evaluate opportunities for improvement, or design and build a new center. We can also support activities such as the sale or commercialization of a shared services center. Our team is passionate about the role of shared service centers as a tool to share and reduce fixed costs within the education and government. We have creative (and proven) models that can help you rethink how you do business in today’s challenging economic conditions while utilizing the tax payer’s dollars more effectively. Peak Performance Technologies will help your shared service center focus on such nuances as customer service, partnership, scale and scope, adaptability, process management and ownership, innovation and governance.

What is it?

Shared Public Sector Services (SPSS) is the bringing together of two or more public sector organizations to merge some or all of the units providing these services with the goal of sharing or reducing costs, improving services and cost efficiencies and streamline operations to be a better steward of the tax payer’s dollars. Common examples of public sector organizations getting together to share fixed costs or create formal shared service centers include:

State Agencies consolidating operations wherever possible
State or Local Governments combining certain facets of their operations to leverage economies of scale, share resources, reduce fixed costs and even generate revenue
City and County Governments working with their independent school districts to consolidate I/T functions or provide targeted services to each other
State Government and funded public colleges consolidating operations or creating models that share fixed costs to eliminate redundancies wherever possible
Federal agencies consolidating commoditized functions to save money and focus on matters that are more important to the citizens of the nation
ERP customers running similar products getting together to consolidate key support functions and share internal resources (functional and technical).

What are the issues?

Setting up Shared Services is full of pitfalls, some of which are obvious, and others less overt, but just as deadly. A very brief checklist of issues includes:

Politics: Will the political climate allow for consolidating functions?
Is there a shared vision at from the outset?
Do all executives understand the implications and objectives of shared services?
Is there a genuine commitment to achieving the economies of scale, or just lip service?
Is the governance model appropriate - is it working?
Is there buy-in at the middle management layer?
Was asset ownership agreed up front?
Were the services and service levels agreed up front?
Was the charging mechanism agreed up front, has it been reviewed appropriately?
Were existing service levels and costs benchmarked before implementation?
Is customer satisfaction measured, and if so, what actions are being taken to follow up?
Have client agencies created 'shadow structures'?
Has there been management to ensure that the net total of staff servicing an agency's corporate services has not increased?
Were all the implications on existing licenses, policies and contracts ironed out at the start?

There is a raft of detail behind each one of these, and many, many more points of consideration.

Where Do We Start?

For agencies about to enter in to a shared service arrangement there are so many issues. You do not want to start each initiative from scratch. So make use of someone who has actually experienced prior implementations.

If at all possible, either recruit (senior) staff who have managed in other government shared service implementations, or make use of experienced consultants in the field, such as Peak Performance Technologies. The private sector model is different, so someone with public sector experience is preferable. If you use a consultant, check the experience and references of the individual consultant being proposed. Some individuals - even within some of the better known consultancies have struggled with implementations in the public sector, through applying 'outsourcing' or private sector models where they are inappropriate.

Regardless of what help you receive from consultants or central agencies, take the time to seek out other agencies that have completed their implementations, and spend time discussing their experience. In Shared Public Sector Services, as with any complex management issue, there is no substitute for experience!

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