What a SSC Is and How to Build It Effectively

Establishing an effective shared service center (SSC) that performs its functions correctly, and resolving problems that arise in the process, is a fairly broad topic. In this material, we will give a little theory: we will find out what an SSC is, talk about its various functions and highlight the main drivers for creating an SSC.

What Is a SSC 

An SSC is a purpose-built unit within a large company or institution that outsources certain business processes across the organization, such as accounting or human resources. It is worth clarifying that, first of all, service functions are transferred to the SSC in order to increase the efficiency of the business. SSCs can have different functions, they can be both structural subdivisions and external legal entities within a group of companies. In summary, an SSC is an in-house provider of a huge range of services.

The SSC brings together the service departments and all the services that these departments provide. They can be divided into several functions.

SSC Functions 

Transactional. These are the functions that are performed by departments, one way or another related to the processing and processing of payments or payments. Companies that transfer them to the SSC achieve the following improvements.

What functions are we talking about:

• Payment acceleration.
• Accelerating the receipt of services from providers. For example, an employee sends an invoice to the required department through the call service, and in return receives the number of the payment order that this department sent to the bank and supplier. As a rule, already after this, suppliers begin to provide services in order to meet deadlines.
• Billing functions. If the company provides any services, it can arrange partial processing of billing in the SSC. In this case, data from production systems and billing systems are sent to SSC employees for processing. In this case, both the client and his manager are notified.
• Increasing employee loyalty. For example, accelerating compensation payments to employees of the sales department. In their activities, companies often incur costs, which in a general sense are called representation. The organization of processing requests for such compensations in the SSC and the increase in the efficiency of such processing increase loyalty and additionally motivate employees.
• Financial transparency. When transactional functions are enabled in the SSC, a single registry is created that allows you to see the sources of payments. That is, to identify employees requesting various payments. This allows you to categorize requests, see where and why demand and costs are high.

What transactional services are most often implemented in the SSC? These include payroll, travel/holiday allowance, expense reimbursement, and supplier invoices.

Department services. As a rule, this area includes services from service departments: IT, HR, AHO and the personnel department. The transfer of departmental services to the SSC provides:

• providing employees with relevant and timely information,
• speeding up the processing of applications,
• cost reduction.

Every day, employees request a huge number of different documents and IT services. The purpose of the SSC in this area is to prevent businesses from digging into the flow of applications and help provide employees with relevant assistance. Fast processing of such requests directly affects the speed of the business, accelerates its growth and reduces the costs associated with waiting times.

What departmental services are most often implemented in the SSC? These include ordering 2-NDFL certificates, requests for transportation, processing the exit of a new employee, and installing / moving workplaces.

At the same time, the key success factors for the transfer of functions of SSC departments are:

• clear application life cycle,
• convenient UI and clear UX,
• easy entry.

Strategic. These are the functions that directly affect the commercial component of the business. The organization of these functions in the SSC helps the business to sell better and more, as well as provide better services to current customers.

• sales support
• marketing,
• strategic planning.

Here are some examples of strategic functions often implemented in SSCs:

• bringing a new product to market,
• distribution of tasks in marketing departments,
• sales support by technical services (presale/engineers),
• post-project support.

Drivers for the Launch of the SSC Project 

Above, we reviewed the most useful and popular examples of the implementation of the activities of departments in organizations using SSC. They help to highlight the results that the business should aim to achieve when building the SSC model. These are the drivers to start the project.

Cost reduction. If a business understands that funds and resources are being spent inefficiently, it has a desire to reduce these costs.

Alignment of business processes, that is, their maximum unification for service departments included in the SSC.

Detection of “bottlenecks”‎ in business processes. During the alignment of these processes, weak, vulnerable and irrational working moments will be discovered. They must be eliminated before process automation.

Using technology for transparent reporting. SSC implementation is impossible without a management system.

Business acceleration. The end result to strive for.

Outcome 

After implementing all the practices mentioned above and automating them in the SSC management system, the business receives a working system for involving employees in the life of the company. In it, all related departments work smoothly and efficiently towards a common goal. Tasks can move from department to department, and each of them will contribute to their solution. Due to this, the business achieves significant growth and control.

But you should remember that when building an SSC, some tasks come to the fore: setting goals for building an SSC, developing various metrics related to the provision of services and finances, as well as familiarizing yourself with the general rules for building any SSC.

In conclusion, let’s list what actions are easy to forget, but must be taken when building an SSC in order to avoid negative consequences in the future.

• watch the variability
• assess the risks
• manage the causes of variation,
• work on typing tasks and processes,
• define buffers in SLA in advance,
• limit the number of tasks at work,
• make buffers in front of bottlenecks.

Make sure you have done a full check, and then SSC will serve for your benefit.