Volume Two Organisational Design

Transcription

1 The Practitioners Guide to Shared Services and BPO Volume Two Organisational Design Alsbridge Europe Ely Place London EC1N 6TE UK Telephone: +44 (0) Subscribe to our free newsletter at

2 TABLE OF CONTENTS Section Page 1. Introduction 2 2. OD for Shared Services and BPO What is OD? Where does OD fit? An approach to OD Strategic vision and design principles The operating model Organisation models Job descriptions, grading and role profiles How OD supports organisational effectiveness 9 3. Organisation and links to governance Service management People and culture Planning The evaluate phase The implement phase The evolve phase How to contact us 18 Appendices 1. The Shared Services solution framework The retained organisation 21 1

3 ONE INTRODUCTION T WO Acknowledgement This brochure is number 2 in a series of Guidelines for Shared Services and BPO developed by Alsbridge to reflect a shared understanding of good practice in the following areas: 1 Developing a business case 2 Organisational design 3 Change management 4 SLAs and service levels, charging and benchmarking Ideas evolve by a process of continual testing, both in debate and in practice. Alsbridge wishes to acknowledge the contribution to this process of the many colleagues, clients and suppliers we have worked with over the years. 1. Introduction This document provides guidance on organisational design (OD) for organisations that are undertaking or contemplating a shared service or BPO initiative. It can be read straight through, as an introduction or overview, or it can be used on a section by section basis as appropriate. The document contains five sections, including this introductory section (Section 1), and two appendices. Section 2 describes the OD characteristics of shared services and BPO initiatives Section 3 outlines the relationship between organisation and governance in relation to shared services and BPO initiatives Section 4 provides more detail on the structuring and planning of the OD design aspects of shared services and BPO initiatives Section 5 contains details of how to contact Alsbridge The appendices contain material which supplements the general overview provided by the main document. OD is a huge subject which has filled numerous text books and magazines, and methodologies. These guidelines do not seek to replicate the generic material that is available. Rather, the guidelines focus on the issues that are specific to shared services and BPO. 2. OD for Shared Services and BPO 2.1 What is OD? Organisation design is sometimes used to mean simply the design of an organisation chart. However, this document uses a broader definition which covers the operating model, the organisational structure (including the organisation chart), the roles, competencies and job descriptions. For shared services and BPO the model has three main areas, as follows: The service management organisation is the shared services/bpo operation itself, undertaking the various transaction processing or administrative activities. Some shared services/bpo operations will deliver specialist and expert services. This organisation may be an internal shared service centre, serving one or many internal customers, or external, which is typically the outsourced/ BPO option. The retained organisation is the term used to describe what is left behind when the shared services or outsourced activities are transferred to the new service provider. There are two aspects to the design of the retained function. First there is a need to design an organisation that is effective in receiving the service delivered by the shared service/bpo provider. This will require an organisation where there is clarity of responsibility for inputs and outputs to/from the provider. Second, there is a need to design a retained organisation that is effective in performing its role in supporting the business. The governance layer term refers to the activities that are necessary to manage a customer/supplier relationship, including the management of service level agreements, performance reporting, billing, and issue resolution. The figure below shows this diagrammatically. Organisation Design for Shared Services comprises three elements Retained Function Defines the strategic direction of the function relative to business requirements. Provides support to decision makers Shared Services Organisation Delivers transactional and Business Support services to agreed service levels and cost/price Retained Function ( and Business Support) Shared Service Provider Layer Defines the requirements of the business unit relative to the shared service centre and manages the relationship between the retained function and the shared services provider 2 3

4 T WO T WO The reason for making the distinction between the three components is that each has a different job to perform in terms of ensuring the effectiveness of a shared services or BPO initiative, with different requirements in terms of skills and competencies, career and reward structures, culture, and performance management. See Appendix 1 for a summary of the Shared Services solution framework. 2.2 Where does OD fit? OD is about developing an organisation that is fit for purpose. However, it cannot be seen in isolation, but as one element of a complex mix of activities which fit together to deliver the overall change to a shared services / BPO environment. The diagram below (taken from the Change Management Guidelines which is part of this set) describes a framework for Change Management, of which Organisation (the OD work-stream) is a critical component. The Change Management Guidelines in this series cover the segments Leadership through to Culture in the wheel. This document covers the Organisation segment. 2.3 An approach to OD The approach illustrated below is designed to deliver a working organisation structure, which defines: organisation structure job descriptions staffing and skill requirements gradings clarity about the boundaries with other organisational groups To get to these outputs, there are often externally imposed inputs such as the overall operating model for the wider business, political and strategic constraints, existing structures and people, and headcount targets, which will often have been articulated in the shared services business case. The outputs are generated from a number of activities, which usually happen in a sequential order (from the top of the diagram below) starting with a statement of the vision and strategy, agreement of the design criteria and sign-off of the operating model. A Framework for Change Management Approach to Organisation Design Culture Confirming the vision, values and behaviours Individual values and the capacity to change Strategic message Continuous Improvement Balanced score card Performance management Reward alignment Communication Organisation Operating Model Structure Roles Competencies Populate Decision Making Effective Organisation Migration plans Redeployment Legislative compliance Redundancy Support Morale maintenance Communication Execution How leadership works together Identifying the leadership actions Individual leadership actions Ensuring we have the right skills Learning plans New capabilities Career plans Leadership People Capability Vision and Inputs e.g. Operating Models Political requirements As Is structure Headcount Targets Design Criteria Bottom Up Design Operating Model SS Organisation Structure Retained Organisation Structure Top Down Design Job Descriptions Populate and Migrate Role Profiles Outputs Structure Boundaries and handoffs Job description / role profiles Resource requirements Role location Gradings 4 5

5 T WO T WO Strategic vision and design principles The first activity in designing an organisation structure is the development and agreement of the strategic vision and related design principles. The model below gives an example. Whilst the statements in this example may appear generic and/or high-level, they are important, because they represent a statement by the design team, signed-off by the governance body, of the type of organisation that will be delivered The operating model The operating model is the first key deliverable in any organisation design. The model describes in broad terms how the new organisation will operate and interact with its customers and other stakeholders. The diagram opposite shows an example of an operating model for Finance. As can be seen in the example to the right, the operating model does not have any reporting lines, role descriptions, or headcount numbers. However, it describes in broad terms what activities are undertaken and how the various relationships work. The diagram shows at a very high level what the shared services operation will deliver. There are interactions with: external customers (these could be suppliers, tax and regulatory authorities) Operating Model (example for Finance) internal customers other business units the corporate centre The example also shows that self-service is a key part of the model. External Customers From Strategic Intent to Design Principles (example) We will deliver a Shared Service organisation that: Increases the quality, efficiency and speed of HR, Finance and Procurement transaction services Improves information reporting Delivers significant cost savings This will be achieved through concentrating common and transaction processes in shared service centres Critical Success Factors for the SS: Organisation Design Enables effective customer relationship management and efficient delivery of customer service Integrates Businesses across government Reduces overheads and management structures Enables each member of staff to deliver their part of the customer service in line with world-class process excellence and quality Creates an organisation that is flexible and quickly adaptable to change Design Principles: Principle 1: We organise to ensure flexibility and responsiveness to customer requirements Principle 2: We minimise cost in delivering agreed service levels Principle 3: We ensure clear roles and accountabilities Principle 4: We structure to maximise work process effectiveness, quality and excellence whilst exploiting economies of scale Principle 5: We create a rewarding, challenging and stimulating working environment Shared Services Reports and Analysis Transaction Processing Process Improvement Application Management Internal Customers: financially and commercially aware Customer Relationship / Contract Management Corporate Centre Self-service information Managing Services Frameworks and policies Corporate Processes and Systems Performance and Commercial Challenge Expertise Building financial and commercial Management Capability Business Unit / Support Unit Finance Managing Services Tailor and Cascade Processes Performance Management and Commercial Management Support Performance Management and Commercial Management Challenge Building Financial and Commercial Management Capability Assurance Services Shared and Corporate 6 7

6 T WO T WO The text that would usually support this model would describe the nature of the interactions, including what information is passed across the interface. This level of detail will probably be sufficient, for example, for a shared services strategy document. However, a much more detailed description of how the model works will be Various Models for Organisational Design A A A C required for the detailed design of the shared services organisation Organisation models Once the operating model has been developed the next stage is to develop the organisation structure to support it. HR Procurement Finance Corporate Function 1 Function 2 Function 3 B D Process B B C C Geographical / Market / Customer A Functional expertise C Functional B D D D A C B D POLICY PARTNER Customer A Customer B Customer C Note: A matrix could be applied to any combination of function, customer, geography, market, product YOU SLA Matrix Outsource SERVICE THEM Organisation models can take various forms, from functional/process models though to matrix models and market/customer models. For shared services the design is usually based on a functional model, although when there are multiple customers it is common to find an organisation design that incorporates sub-groups who service specific customers within each functional grouping. The structure of the retained organisation is usually based on traditional functional designs. Appendix 2 contains more guidance on the structure of The Retained Organisation Job descriptions, grading, and role profiles These document the roles, skills, experience and competencies required to support the new organisation. OD and Organisational Effectiveness Inputs Operating Model HR Policy / Processes Headcount Targets Culture, Vision & Values Political Imperatives Location Design Organisation: Design & Populate Structure Job Descriptions Competence / Skills Resourcing Location Affordability Most organisations have their own templates for this information, however it is important to note that the switch to a shared services or BPO environment will mean that additional skills and competencies (for example managing across organisational boundaries, and client relationship management skills) will need to be included in a number of roles that have not required these in the past. 2.4 How OD supports organisational effectiveness An organisational design that is fit for purpose is a prerequisite for organisational effectiveness. This is why OD must cover more than just organisational structure, as other elements such as governance and stakeholder management processes play an important role in ensuring that effectiveness objectives are able to be met. Populate Matching Selecting In / Out Recruiting Surplus Communications / Stakeholder Management Employee Relations Organisational Effectiveness Operating Model Implementation Leadership Development Competency Development / Learning Business as Usual Performance Management 8 9

7 THREE ORGANISATION AND LINKS TO GOVERNANCE THREE ORGANISATION AND LINKS TO GOVERNANCE 3. Organisation and links to governance Shared service / BPO governance is about making decisions and assigning accountability for agreed outcomes and it comprises a set of processes and structures that are designed to address top management concerns such as: relating to the shared services relating to user organisation Aligning the shared service capability with the business strategy Ensuring the shared service capability is adopted and fully utilised throughout the organisation Evolving the retained function to operate in a shared services environment and shared services / BPO communities with a mandate to represent their constituents Implement a clear communication approach. It is critical that mechanisms exist to collect information and disseminate decisions throughout the organisation The shared service / BPO governance structure should reinforce the roles and responsibilities of the business function and the shared services capability key customers and stakeholders and ensuring that the services of the shared service operation deliver to their needs. At the highest level Service management exists to meet regularly with customers to share objectives, review past performance, and set expectations for future activity. A successful Service management team will continually check the alignment of the services from the shared service centre with the goals and objectives of the customer groups. Measuring and improving shared services performance Cascading shared service strategy and goals throughout the organisation Providing resources to implement and improve the use of shared services Implementing a Shared Services Structure Customer Group Meetings Organisations meet to review performance Body Board Service & Customer Forum Operational Management Team An effective governance structure can be designed using the following principles Decision making responsibilities should be clearly articulated and confined to the formal governance structure Appoint recognised leaders to the governance team. bodies need membership from the business Membership Chair Shared Service Director Departmental Directors Shared Service Managers Customer Representatives Customer Business Partners Functional Specialists Account Managers Shared Service Managers Shared Service Management team Meeting Frequency Quarterly Weekly The model on the previous page is an example of how a shared service governance structure can be implemented. Key components include a governance board consisting of: Senior customer representatives Heads of profession for the key functions in the shared services Senior representatives from the shared services operation This governance board receives inputs from customer forums and the shared services operations management team. The board has responsibility and oversight of the shared services capability and will: Set the policy for shared services / BPO Champion convergence of shared services requirements Determine the performance management regime to be applied and ensure links to broader performance management mechanisms Moderate and approve plans, priorities and investment Monitor delivery of shared services objectives Approve framework commercial agreements Address and resolve shared services issues which threaten to limit achievement of overall objectives Consider and approve interventions required to deliver on shared services objectives 3.1 Service management Service management is about building relationships with Service management is usually made up of the following key activities: Quality Control to monitor standard processes and outputs on a day by day basis Performance Measurement to track volumes and adherence to service key performance indicators within cost parameters Process Improvement teams to manage change requests and to act to correct service non-compliance in a timely manner Service Level Agreement (SLA) management to set up suitable SLAs which define the responsibilities between service provider and customer Performance reporting of KPIs and balanced scorecards on a regular (normally monthly) basis to inform the dialogue between the service provider and the customer Customer satisfaction feedback surveys to measure baseline satisfaction with services on a regular basis (normally a sample approach across different customer sectors) Boards which meet on a quarterly or halfyearly basis to review overall performance and prioritise new services for roll-out, improvements to be scheduled or investments to be made These activities can be shown to link together in the diagram overleaf showing the various activities and tools that typically underpin service management

8 THREE ORGANISATION AND LINKS TO GOVERNANCE FOUR PLANNING Service Management Activities Quality Control Standardised processes Control check points Service improvement plans Employee feedback Service lines Service terms Process Improvement Management of Non-Conformance Change Request Management Performance Measurement Volume Indicators Key Performance Indicators Cost analysis If service management is deployed correctly it will help drive: a customer focused service centre culture an efficient mechanism through which performance against agreed service levels can be managed and nonperformance escalated, as necessary a focus on service performance and a continuous improvement mindset a regular supply of data and analysis to ensure that the governance of the shared service arrangements is conducted in an informed, evidence-based manner. Target service levels Performance feedback Customer feedback Two-way Service Level Agreement Overview of services and key inputs Service Levels Performance Reporting Overall Commentary Key Performance Indicators Appendices Customer Feedback Survey Customer satisfaction Boards Customers and nominated Board members There is no clear cut rule for how service management organisations are usually structured but it is common to find four main teams reporting into an overall Service Management Director: Service Team Responsible for managing key strategic relationships with customers and conducting account planning and contract management discussions. This is essentially a small support team for the Service Management Director which will normally represent the shared service organisation at governance board meetings. Service Management Team Responsible for day to day incidence management, service reporting, capacity planning and non-compliance interventions. This team will also prepare monthly/ quarterlyreporting packs and participate in service review meetings. This team manages customer satisfaction surveys. Service Development Team Responsible for scheduling continuous improvement activities, service upgrades and new service implementation management. This team is usually responsible for managing operational risk management and quality audit and compliance activities. Financial Management Team Responsible for operational budgeting, management of any cross charging or client billing arrangements and the tracking of project finances. 3.2 People and Culture The higher degree of clarity around services and service standards that SLAs bring about means that service centre teams need to focus on developing and maintaining the skills, behaviours and knowledge that drive outstanding service. In the case of an internal shared service centre there is usually a big attitude change required by staff moving from traditional service functions of a back-office job into a shared service operation of a front office service delivery role. In shaping and developing the culture, the shared service centre management team needs to consider the following: being clear about the values of the organisation and how these link to expected behaviours (so that the way that people are appointed, managed and developed is clearly driven by the values of the organisation) hiring decisions - where appointments are made on the basis of attitude as well as technical skills promotion and succession planning - where decisions on who gets moved are based as much on how an individual gets work done (their behaviours and demonstrated values) as on their ability to deliver results performance appraisal and reward - where the focus on assessment is to identify and reward those who go the extra mile to deliver customer service or those who work with their teams to bring everyone to the same performance level. The performance management process also creates consequences for poor performers who are made aware of improvement requirements training and development - where the training and development offerings are clearly linked to developing the behaviours and skills required to drive customer service for each role 4. Planning OD is not a one-off exercise, it should be developed and updated iteratively throughout the lifecycle of a shared services / BPO programme. The work on the OD will differ, depending on where an organisation is in the lifecycle. This section describes the Alsbridge FastSource Lifecycle in summary terms and maps the various types of OD work onto it, as indicated by the numbers on the diagram overleaf. 4.1 The evaluate phase The journey to shared services usually starts with a series of evaluations of the options, starting at a high level, with successive drill-downs into more detail as the opportunity and understanding develops. The chart below has three iterations (Research, Feasibility and ), but there may be more or fewer

9 FOUR PLANNING FOUR PLANNING Shared Services Lifecycle Phase 1 - Evaluate Research Identify need and interest Investigate options Stakeholder assessment Risk analysis Education sessions Feasibility Develop Strategic Options Define solution Define operating models Define commercial models Confirm potential suppliers Stakeholder assessment Confirm Scope and Operating Model Define current state Confirm commercial model Business case Transition approach Stakeholder assessment 1 2 Design Processes & service levels Technology Organisation Change Management & Communication Build Facilities, recruit, train Technology Policies & procedure Service Agreement Service management Charging structure Change & issue management Design Processes & SLAs Systems Organisation Change Management & Communication Supplier selection RFP Development Evaluation & selection Negotiate Contract Deal parameters Due diligence Contact award The research stage is often undertaken to understand the potential that shared services has to offer; usually this done by analysing what other organisations have experienced, and applying that learning to the current situation. If this research gives a convincing argument that shared services may be beneficial, then usually a feasibility study is undertaken. Phase 2 - Implement INTERNAL SHARED SERVICES Transition Operations Knowledge transfer Work-shadowing Service management Technology acceptance People transfer Change management & communication OUTSOURCING Transition Operations Knowledge transfer Work-shadowing Service management Technology Implementation People transfer Change management & communication Facilities Service Agreement Management Review Coach Deliver Health Check Services & cost Risk Establish structure Define Deliver Contract Management Review Coach Deliver Health Check Services & cost Risk Phase 3 - Evolve Establish structure Define Deliver Programme Management: Project Management Risk Management Change Management Quality Assurance # = Points in the Lifecycle where the Organisation Design is relevant A feasibility study is a relatively high-level exercise, which enables the organisation to understand the options, and the likely order of magnitude costs, benefits and business case. It will usually focus more on the strategic drivers and options, rather than on the detail of the shared services solution. Assuming that the feasibility study is positive, and the organisation wants to proceed, then a more detailed strategy will be developed. 1 2 The shared services strategy articulates the end goal (operating model, process scope and outline design, sourcing, financing, etc). The work on Organisation Design is done in the Feasibility Study and stages as follows. Feasibility Study Here the business decision is to agree whether or not there is a prima facie case for shared services, and to approve the expenditure on developing a shared services strategy. This is a strategic stage do we have a strategic need for shared services?, and therefore the analysis will be at a high level, with the primary focus on understanding the business need, the high-level options, the likely shape of the operation (its scope, how it will work), the potential sourcing options, the likely risks, implementation options and timescales. In terms of organisation design work, the feasibility study needs to address: the concept of splitting the transaction processing activity from the retained function, with a service management wrapper a general description of the service organisation, with potential options a high level description of the role of the retained function, the general competencies needed, and a description of how the retained function will buy services from the shared service centre or service provider a general description of the service governance principles and approach. Whilst the feasibility study is about taking a strategic decision regarding shared services or BPO ( Why should we do shared services or BPO? ), this stage is about developing a clear strategy for shared services / BPO ( How should we do shared services or BPO? ). This strategy will articulate the future model and timing (including the sourcing options of in-house or BPO), based on a detailed understanding of the current metrics and a robust assessment of the available options for improvement. At the end of this phase the organisation will have a high-level blueprint of the processes, systems, commercial and operating models, plus a business case and an implementation approach. There should also be stakeholder buy in and approval to proceed. The development of a strategy for shared services / BPO is a much more detailed task than the feasibility study, and it will cover the following OD aspects. A clear organisation model Whether the organisation structure should be oriented by process, customer or function High level role outlines for devolved function and the retained function Outline sizing of the organisation headcount Business as usual principles to be agreed for transition Ratios and best practice guidelines used to size the organisation Basic volumetrics captured to verify sizing by ratios Blueprint of key measures and SLA / OLA outlines Outline description of governance and escalation processes Formal estimates of likely redundancies Proposals for a formal consultation process Consideration of the TUPE implications 4.2 The implement phase The implementation activity in the Lifecycle usually takes one of two routes. Either build and operate in-house or outsource. Although both routes deliver shared services the activities of each route are different. In the in-house model, the organisation needs to design its own processes, build the shared services operation, and then transition and operate the service. With outsourcing, most of the build and 14 15

10 FOUR PLANNING FIVE HOW TO CONTACT US 3 4 design work is done by the outsourcer, and the organisation s main responsibility is to design and operate the retained function, and to ensure successful transition of the services to the new (outsourced) service provider. Detailed Design for Internal Shared Services Once a shared services strategy is signed-off, detailed design can commence covering the future operating environment (processes, technology and organisation), for both the SSC and the retained function. Work in this stage will include: Full role descriptions, including governance team Final organisation sizing Completion of job evaluation exercise Confirmation of pay and grading structures Full definition of the key interfaces with the retained function / customers and third parties Re-confirmation of headcount numbers by means of detailed volumetrics for both historic and forecast activities Identification of key external recruitment needs Finalisation of business as usual teams Detailed KPIs, SLAs and OLAs Definition of key interfaces and reporting and escalation routes Confirmation of the TUPE situation Plan for individual consultation and briefings Completion of formal consultation Build Activity for Internal Shared Services Work in this stage will include: Populating the new organisation Setting up governance structures and processes 5 6 Transition Activity for Internal Shared Services Work in this stage will include: Launch of service management and governance activities Fine tuning job and role descriptions in the light of day-to-day operational experience Detailed Design for Outsourced Shared Services Where BPO is the chosen option the design and build activity is shared between the outsourcer and the customer. The outsourcer will design the shared services operation (often they will have an existing facility from which the services will be delivered). The customer will design the retained function and will be responsible for ensuring that the services are effectively transitioned to the outsourced service provider. Appendix 2 gives additional guidance on the requirements for the retained function. 4.3 The evolve phase The evolution of the shared services starts with Go Live Day 1. Usually the service will not operate at the target level immediately, and so bedding in and improving work is needed usually this is an on-going activity that never ends. Also, ongoing improvement work is required to meet changing customer needs, changing technology and the evolution of a customer service culture. In OD terms this is likely to mean a programme of continuous improvement for all aspects of the organisational design. 5. How to contact us Alsbridge is the premier consulting firm providing independent, unbiased advice on outsourcing, shared services and offshoring. With global presence across North America, Europe and Asia Pacific, we provide clients with unmatched experience and in-depth industry knowledge. We help clients reduce costs, improve processes and maximise share holder value through the use of both onshore and offshore outsourcing and shared services. Alsbridge consultants are available to help you with your sourcing decisions and strategy. If you are looking for general advice or comprehensive assistance, please contact: Europe Ely Place London, EC1N 6TE UK Tel: +44 (0) Fax: +44 (0) enquirieseur@alsbridge.com The Americas Addison Park Place 4560 Belt Line Road, Suite 330 Addison, TX USA Tel: Fax: enquiriesusa@alsbridge.com 16 17

11 APPENDIX ONE THE SHARED SERVICES SOLUTION FRAMEWORK APPENDIX ONE THE SHARED SERVICES SOLUTION FRAMEWORK APPENDIX ONE Organisation Design in shared services needs to be seen in the context of the entire solution. So before describing how and when to develop an Organisation Structure, it is important to have a common understanding and definition of shared services (the end result and how to get there). The Solution Framework is our way of defining this. In the Shared Services Solution Framework set out below, the context, strategy, and transformation components Shared Services Solution Framework Political Considerations Market Capability and Capacity Business objectives Level of ambition Operating principles Core business metrics Utilising sharing as a strategic asset Procurement strategy Organisational Development Cultural Outcomes Migration Planning Change Management Approach Context define which services and processes are to be delivered through the shared services capability and what governance arrangements will apply. The solution framework also encompasses the transition plan and considerations for moving from the current state to the desired shared services model. Context Shared Service Capability Management and People and Organisation Services and Processes Service Management Infrastructure Transformation The context for a shared services solution describes the background as to why a shared service approach is a good Skills & Resource Development Metric & Reward System Obsolescence Demographics Economic Considerations Transition Planning Skills and resource transfer Employee transfer Training and development Sequencing Dual environment management Testing Switchover procedures Incentive programmes business decision. It should consider the economic reasons for shared services, the demographics of the existing workforce and potential customer base, any political considerations as to the nature of a shared service solution. This component of the solution framework describes the shared services strategy as it relates to a specific organisation. It describes a high level approach to shared services and explores how shared services will meet the needs of the organisation better than the existing arrangements. It will describe the benefits expected from the shared services capability, how existing investments and assets are to be utilised, and it defines a procurement approach for how shared services are going to be sourced. Transformation For shared services to be transformational there are a number of considerations beyond the creation of a shared services capability. These include changing culture and behaviour of the retained function and that of the customers of the service. This in turn will require changes to skills and capabilities, the organisation structure, and the metrics and reward system. This level of change requires a robust change management programme and an obsolescence approach for phasing out redundant methods of working. Transition The transition component of the solution framework describes how the organisation is going to move from current service arrangements to the new shared services capability. It will include knowledge transfer, training requirements, employee transfer, and an approach for testing and switching on the new services. Shared service capability Management and The governance structure forms the critical strategic linkage between the supported organisations and the shared services capability. Although there maybe multiple functions represented in the shared services model it is recommended that there is an overarching governance structure to ensure prioritisation and investment decisions across the sector for common shared services components such as infrastructure, service delivery, service management approach, etc. People and Organisation This component of the solution describes the culture and behaviours, organisation structure, workforce management practices and skills required to successfully execute a shared services capability. Services and Processes This element will describe the components of the processes performed by the shared service centre, the retained functions and the employee or manager. Service Management The service management approach includes defining the expected levels of service performance, the measurement process, and pricing considerations, if appropriate. It also describes the approach to supporting the customer base, how interactions are to be managed and the appropriate response times and turn-around times for interactions with the customers of the shared service capability. Service management will also define key performance metrics for shared service employees and be a critical component of creating a service culture within the shared services capability. Infrastructure This component defines the technology and physical infrastructure that is required to enable the shared 18 19

12 APPENDIX T WO THE RETAINED ORGANISATION services capability to function effectively. It includes developing an architecture that allows services to be delivered to employees in any required location, at any required time. This component defines the delivery channels, telephony, and physical environment of the shared services capability. APPENDIX TWO The Retained Organisation The future service delivery model has significant implications for the retained function. There are two key retained roles that will have significant interaction with the shared service centre or outsourced service provider. These are the functional specialists and the business partners who have the day to day relationship with the business customers. Specialists (policy subject matter experts) Specialists will advise on setting strategy and focus on policy development. They will not be involved in basic administration, and will have greater space to focus on more added value activities such as assessing the impact of future legislation and leading best practice to deliver appropriate policy changes as required. On the infrequent occasions when the most complex policy and process queries cannot be resolved by the shared service centre, these queries will be passed to the specialists for resolution. A mechanism for managing and tracking such queries will need to be agreed. Business partners The role of a business partner is to: be part of the business management team with specific responsibility for leading the development and implementation of solutions, in partnership with, and utilising the resources of the shared service centre or outsourcing provider champion, drive and embed the functional agenda with the business customers and ensure its inclusion in the business planning process support change initiatives undertaken by business customers manage relationships with business customers on a face to face basis (e.g. conduct regular discussions where customers can raise issues, concerns and ideas etc) roll out corporate policies which are the responsibility of the retained function act as a communications channel for major communications work with senior managers on issues consolidate and capture the customer feedback use trend reports provided by the shared service centre or outsource provider as the basis for advice to managers on local activity that needs to be taken act as a coach for business customers on all functional issues. 20