Risk Management of the Shared Services Center Implementation

The opportunities that shared services centers present are enormous, both financially and strategically (Horan & Vernon 2003, 53). Therefore, it is no wonder that more and more organizations have established their own shared services centers, in which support functions that have very little of strategic implication have been located. However, implementing a shared services center creates many challenges for any organization (Fisher 1998, 40). It requires a transformation of people, processes, and technology (Shah 1998, 7; Jarman 1998, 33). Therefore, the SSC implementation should be managed carefully and the risks related to the initiative should be identified and managed properly in order to complete the implementation successfully. Implementing a SSC has not been studied previously from the risk management perspective. This study provides some feasible contributions to this gap and omission in the research. The purpose of the study is to identify the risks related to the SSC implementation and to discover the methods of managing these risks in order to successfully adapt a SSC. The study was conducted by using qualitative research methods and it consisted of two case studies: the other concerning a global financial SSC and the other concerning a regional supply chain SSC. Analytic benefits of having two cases are substantial as the conclusions arising from the two experiments are more powerful than those based on a single experiment alone (Yin 2009, 61). In this study, the cases were analyzed together to compare the empirical results and to find out if the results are similar in both cases despite the SSCs produce different types of services. Having two cases increases the validity of the study substantially. The key risks and risk management methods related to the SSC implementation were similar in both cases despite the different nature of the services. People related risks were identified as the most significant risks in terms of the SSC implementation. Key issues concerned finding the right resources, retaining the current personnel, and managing the resistance to change. Process, technology, and management related risks were also found to be part of the SSC implementation. The key cornerstones to manage the risks in the SSC implementation were identified as the following: top management support, the appropriate core team and schedule, detailed enough plans, communication and support for the initiative among the units and staff. Asiasanat:shared services center, implementation, risk management, ris