When most of us think about ‘Financial Services’ what comes to mind are things like investment, money management, banks and brokerage houses. Financial Shared Services however, are the consolidation of a firm’s financial operations designed to increase the efficiency of finance operations in Shared Service Centers and improve relationships with suppliers. The solution is designed to make finance operations more efficient through advanced automation and deliver an improved experience for buyers, suppliers, employees and customers through a progressive portal and SLA management.
“Shared services are cost-efficient because they centralize back-office operations that are used by multiple divisions of the same company and eliminate redundancy. Some companies use a chargeback system to bill divisions that use the service on a per-use, per-quarter or per-year basis. Other companies absorb the cost of shared services as part of the continuing cost of running the business. Today, most companies employ a shared services model for finance, human resources management (HRM) and information technology (IT),” from ‘Shared Services’ as posted on TechTarget.
Organizations leveraging Financial Shared Service systems reap the benefits of improved efficiency of their financial operations and improve their business relationships with suppliers, buyers and employees. As a result of these benefits, companies implementing these systems expect to gain additional competitive advantage over other firms in their marketplace among other advantages:
- Reduced operating costs by automating processes across finance domains including Procure to Pay, Travel & Expense, and Vendor Management.
- Increased control and compliance through better exception management and reduced contract leakage.
- Improved supplier relationships by granting direct access through a Portal and Live Chat.
- Reduced financial waste through tighter control over payments and reduced errors.
- Improved insight to finance operations through dashboards and analytics.
TechTarget continues, “The goal of a shared services delivery model is to allow each business division to focus its limited resources on activities that support the division’s business goals. Technology has often been the driver for shared services within an organization because it can be expensive to purchase, maintain and train employees to use. Back in the 1920s, for example, an Underwood typewriter cost $100 and typists were highly trained employees. Instead of having each business division within the company hire its own typists, a centralized department for typists was seen as being more cost-efficient and the typing pool was born. Today, a typing pool would be called a Shared Service Center (SSC).”
