PwC and HfS Research Examine the Evolution of Global Business Services

New study finds a significant shift in outsourcing and shared services drivers is changing the dynamics of global business services strategies

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PwC

Aug 15, 2011, 09:26 ET

NEW YORK, Aug. 15, 2011 /PRNewswire/ -- A new study released today from PwC US and HfS Research, "The Evolution of Global Business Services: Enhancing the Benefits of Shared Services and Outsourcing," finds that nine out of every ten respondents employ shared services and 97 percent manage outsourcing relationships. The study surveyed 347 senior business operations executives with responsibility for shared services and outsourcing strategy.

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According to the report, as the economy recovers, 44 percent of organizations will seek to reduce their dependence on fragmented, in-house delivery capabilities for business operations and shift to shared services (59 percent) or outsourcing (73 percent) models.

"Organizations need to focus on aligning corporate strategy, improving investment portfolio decisions and reallocating current spending," said Dr. Charles Aird, US and Global Leader of PwC's Shared Services and Outsourcing Advisory Practice. "To do so, they are adopting global business service models."

Phil Fersht, Founder, Chief Executive Officer of HfS Research, stated, "A well-executed global business services strategy is distinctly different from the narrower focuses of shared services and outsourcing, as it identifies corporate objectives and encourages internal functional silos to collaborate with each other and third party service providers to create breakthrough, operational capabilities that drive business outcomes. The results can differentiate a company."

"The Evolution of Global Business Services: Enhancing the Benefits of Shared Services and Outsourcing" emphasizes the following key drivers for global business services execution:

Corporate strategy drives global business strategies – Focus global business strategies on enterprise strategies. Keep a tight rein on change orders, ancillary decisions and stakeholder alignment.
Marketplace change and global business strategies must be adapted – Despite the best efforts to anticipate needs for scalability, extensibility and flexibility, global business strategies must constantly adapt to marketplace demands on an organization.
Innovation requires investment in developing ideas and implementing solutions — While most organizations are dissatisfied with the amount of innovation they receive from service providers, most organizations under-invest their resources and efforts to innovate.
Create a culture of open problem solving, root cause analysis and best practice sharing – Reward open, early disclosure of problems before they become significant.
Develop a comprehensive multi-process, multi-year plan –Well planned and executed global business services don't happen overnight. Develop a two to three year plan to achieve objectives.
Governance requires professional, experienced staffing and careful attention to career development –The governance team drives execution of global business strategies. Acquiring a mix of strategic thinking, operational focus and relationship management skills is critical to success.
Get prescriptive with service provider management activities – Governance organizations must ensure business units are managing service providers consistently and reliably by deploying and monitoring common processes.
The right people and culture matter – Assigning the right people to lead global business services strategy development makes a significant difference. Change doesn't end within the leadership team because employees must increasingly rely on their counterparts at different companies to devise new strategies, resolve problems, and work collaboratively.

"Global business services are not 'one size fits all' as no organization's corporate strategy is the same," added Dr. Aird. "The biggest challenge confronting functional leaders and service providers with limited experience in collaborating to drive corporate strategy instead of functional objectives is assessing their collective opportunities. Clearly, different corporate strategies will result in different global business services strategies."

For a complete copy of "The Evolution of Global Business Services," please visit http://www.pwc.com/en_US/us/outsourcing-shared-services-centers/assets/hfs-report-pwc-developing-framework-global-services.pdf.

About HfS Research

HfS Research (www.HfSResearch.com) is the foremost research analyst firm and social networking community, focused on helping enterprises make complex decisions with their business process operations, IT outsourcing and shared services strategies. It has the largest audience and regular following in today's global sourcing industry.

With 55,000 subscribers, HfS Research provides the most impactful and frequently-visited global collaborative community platform in the global services industry, providing rapid and insightful commentary, analysis and debate of enterprise outsourcing and shared services dynamics. The organization is unique in the fact that it integrates personable social networking with market research and expert advisory services.

The HfS Research mission is to provide a unique environment for collective research, opinion, experience and knowledge across the global outsourcing industry to help enterprises explore new performance thresholds. Led by industry expert Phil Fersht, the HfS Research team is a multi-disciplinary group of analysts across North America, Europe and Asia/Pacific regions, with deep domain knowledge in business process outsourcing, information technology services and cloud business services.

Launched in 2007, HfS Research's acclaimed blog Horses for Sources has more than 120,000 monthly visitors across the global outsourcing industry, and is widely recognized as the leading destination for collective insight, research and open debate of industry issues and developments. The HfS LinkedIn community, The BPO and Offshoring Best Practices Forum, is thriving with over 13,200 industry professionals sharing views and information daily. You can access information about HfS at HfSResearch.com and on Twitter at www.twitter.com/horses4sources.

About PwC's Business Services Transformation (BST) Services

PwC's Business Services Transformation (BST) services assist clients in improving the performance of their Global Business Services, shared services and outsourcing initiatives.

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PwC's Advisory professionals help organizations improve business performance, respond quickly and effectively to crisis, and extract value from transactions. We understand our clients' industries and unique business challenges, and look across the entire organization -- focusing on strategy, structure, people, process and technology -- to help clients build their next competitive advantage. See www.pwc.com/us/advisory for more information.

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