Shared services beyond sourcing the back offices: Organizational design

Abstract

Shared services have been widely spread in the government and private sectors. Unlike outsourcing, shared service is the standardization and consolidation of common functions across the multiple organizations to reduce information process duplication and increase information and knowledge sharing. Shared services should be viewed less as a phenomenon of cost saving and more as a challenge of organization redesign. Five general leading theories of organizational design are examined in the perspective of shared services. A quasi-general organizational design approach is proposed specifically for shared services projects. The proposed approach emphasizes the organizational support for the shared services strategy identification, collaborative partnership network design, optimal shared services process design, and policy and regulation system design.