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Govern Shared Services

Find the optimal path to shared services governance.

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Contributors

  • Barry-Wehmiller
  • CP Partners
  • Convergent Technology Solutions
  • County of Orange
  • Effectus
  • Government of Alberta
  • Kingspan
  • Vale
  • An additional 9 companies contributed to this research. Due to the sensitivity of the information, their identities will be kept confidential.

Your Challenge

  • IT managers have come under increasing pressure to cut costs, and implementing shared services has become a popular demand from the business.
  • Business unit resistance to a shared services implementation can derail the project.
  • Shared services rearranges responsibilities within existing IT departments, potentially leaving no one accountable for project success and causing cost overruns and service performance failures.

Our Advice

Critical Insight

  • Over one-third of shared services implementations increase IT costs, due to implementation failures. Ineffective governance plays a major role in the breakdown of shared services, particularly when it does not overcome stakeholder resistance or define clear areas of responsibility.
  • Effective governance of a shared services implementation requires the IT leader to find the optimal combination of independence and centralization for the shared service provider.
  • Three primary models exist for governing shared services: entrepreneurial, mandated, and market-based. Each one occupies a different location in the trade-off of independence and centralization. The optimal model for a specific situation depends on the size of the organization, the number of participants, the existing trend towards centralization, and other factors.

Impact and Result

  • Find the optimal governance model for your organization by weighing the different likely benefits and costs of each path.
  • Assign appropriate individual responsibilities to participants, so you can effectively scope your service offering and fund your implementation.
  • Support the governance effort effectively using published Info-Tech tools and templates.

Research & Tools

1. Understand each of the governance models and what each entails

Build a plan for governing an implementation.

2. Choose the optimal approach to shared services governance

Maximize the net benefit conferred by governance.

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Search Code: 44783
Published: July 5, 2011
Last Revised: July 5, 2011