Alsbridge Report: More Companies Use Offshore Shared Services To Standardize Business Processes; Cost Savings Not Main Focus

Success of Shared Services linked to strong executive support

Dallas, TX (PRWeb) - March 12, 2007 - A new report released today by Alsbridge finds that offshore shared service centers represent a significant force in the movement to transform the business operations of companies into standardized processes.

Nearly 66 percent of the study’s respondents say they currently use shared services, while another 12 percent are currently planning its use. This represents an 11 percent increase over the data obtained in 2006. Although lowering cost is considered a reason to employ shared services, an overwhelmingly 86 percent of users say they benefit most from shared services because it streamlines business processes through simplification and standardization.

“These findings confirm that companies are continuing to move significant work activities to offshore locations using shared services as well as through third party outsourcing firms,” says Ben Trowbridge, Alsbridge CEO.

Trowbridge says that this strategy is not for all companies, but it should be considered. “Shared services expand the boundaries of what is possible. This is a viable option depending on the risk profile and degree of management involvement desired by your leadership team.”

Finance and accounting, human resources and procurement dominated the major functions going to shared service centers. Yet, new shared services interest appears to be growing in a variety of functions including legal, marketing, engineering and research and development.

One of the most significant findings in this study is that the success of a shared services center is directly linked to a company’s executive buy-in and support. Users cite this trend on average four out of five instances as the most important factor for success, whereas 43 percent of respondents who do not use shared services say they did not have their top management’s support to proceed, making this the leading reason not to build shared service centers.

“In most cases, executives that have little or no experience with shared services are less likely to commit,” says Trowbridge.

Trowbridge says that there are several factors that make it difficult for these organizations including deciding what business processes can be moved offshore, the cost of establishing a shared services center and the method and strategy for moving the work. Additionally, available benchmarking information and unfamiliarity with offshore locations contribute to uncertainty.

“The decision to use shared services requires more involvement than an outsourcing decision,” says Trowbridge.

In regards to offshore locations, the study found that the adoption and risk profiling of new locations in India, China and Eastern Europe are on the rise. Alsbridge plans to publish reports on these new locations in the near future.

“The overall attractiveness of the location is more than simple labor cost arbitrage and should be carefully evaluated before selecting a location,” says Trowbridge. “The goal is to find the perfect fit.”

This study was conducted via the Internet over a three week period using a web survey tool. The aggregate survey results, design, data collection methods and sample information are available with the complete report, which can be purchased from Alsbridge for U.S. $395. To buy, please visit http://www.alsbridge.com/reports.shtml. Alsbridge will participate in the 11th Annual Shared Services Week in Lake Buena Vista, FL as a sponsor. The week takes place March 26 – 30 and study results will also be available during this event.