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From Outsourcing to Insourcing: the development of the shared service concept

"You have to run shared services better than the business itself."

William O'Rourke
Vice President
Alcoa Business Support Services

Executive summary

1.   Cost factors and other business drivers that led to the growth in outsourcing. What leading companies such as BP Exploration achieved through its experience of outsourcing its accountancy operations and next its HR services.

2.   How outsourcing focused companies on the issue of core and non-core processes and the questions that this raised.

3.   How companies moved from outsourcing to developing a shared services concept. Examples of pioneering shared service operations in the Nineties, including Pacific Bell, Alcoa, Ford and General Electric.

4.   The focus on customer service and the need for a service ethic in setting up shared service operations.

5.   Different versions of the shared services model: in-house; in-house, but externally located, outsourced as a joint venture or third party operation, application service provider, ASP, solution where systems and procedures are hosted by a third-party.

6.   The main case study organizations researched as part of the survey of shared service practices and the lessons they reveal: Eastern Health Shared Services, Procter & Gamble, Standard Chartered Bank, Sun Microsystems and Scotiabank.

7.   The overview concludes with a ten-step guide to creating an effective shared services center.

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