Governance / Shared Services

Overview

As organizations have expanded and/or acquired other organizational entities, it is common that  functions become dispersed and occassionally "silo-oriented".  Sometimes these functions miss opportunties to leverage internal best practices, processes and resources.  This can lead to very important functions and departments including IT, HR, Finance, Legal, Real Estate, Marketing, Administration, Customer Service and others becoming fragmented and, in some cases, are more costly, less flexible and may not support the business needs.

TSI helps organizations answer key questions and implement shared services including:

• What is the vision regarding how centralized and decentralized  groups should collaborate to derive the greatest value and enable the overall mission and objectives?
• What domains are most important to address and decide how each is addressed as a shared service or a function that might be better handled in a decentralized fashion?
• What criteria should be used to decide how domains are handled?
• What are the pro's, con's and issues with centralized, decentralized and hybrid models?
• What are the financial, service, quality and customer repercussions of various models?
• What role should "corporate" or a shared service/center of service excellence play?
• What authority, organizational, resource, process, policy, technology and other changes are required to enable the transition to the "new model"?

Governance is a key component when an organization is seeking to improve its performance.  TSI defines Governance as follows - the determination and application of decision rights and accountabilities across various constituencies to achieve improvements in Cost, Quality, Service and Speed - is on nearly every forward-thinking executive's radar screen. 

A recent study by MIT showed the links between business strategy, governance arrangements and financial performance in 20+ in depth case studies and using data from a survey of 256 enterprises in 23 countries. The study found firms with superior IT governance had more than 20% higher profits than firms with poor governance given the same strategic objectives. These top performers have custom designed IT governance for their strategies and identified the different IT governance arrangements these high performers used.

TSI Approach

1. TSI often takes a facilitated approach that involves many of the involved key thought leaders and players to discuss and analyze:

• Role of Shared Service Organization (e.g., IT) - Understanding the role IT and the PMO does and should play in the organization. Is it only for technology projects? What is the value of IT to your company? How do you demonstrated and defend IT’s business value? … IT Infrastructure … Qualitative “soft” benefits … Quantitative “hard” benefits … Business Risk What are the critical processes required to achieve greater value from IT? How does the CIO discuss the value of IT with the CEO and the executive team? What strategies and approaches are most effective?
• Perception - how do key constituents view and value the Shared Service Organization (SSO)?
• Value Delivery - how is value delivered? How is it measured? How is it paid for?
• Organization Structure - who reports to whom today? What "dotted line" relationships exist? How are performance appraisals given and what local versus enterprise bonuses and consequences are in place/should be in place?
• Core Competencies - share skills exist at various parts of the organization and how do those compare to what is needed now and what will be needed going forward?

2. Benchmarking - how does this environment compare to other leaders both in and outside of this industry?

3. Objective Perspective - what recommendations does TSI suggest and what difference will it make in the context of its strategic plan and other initiatives? 

Provided below is an example of an IT governance structure that TSI led. 

How can the new "model" improve the following:

 The purpose of IT Governance is to:

• Provide oversight, and enable business alignment and prioritization
• Manage, evaluate, prioritize, measure and monitor requests for IT in a more consistent and repeatable manner that optimizes returns to the business
• Promote utilization of resources and assets
• Ensure that IT delivers on its plans, budgets and commitments
• Establish and clarify accountability and decision rights (clearly define roles and authority)
• Manage risks, change and contingency proactively. Improve IT organizational performance, compliance, maturity and staff development Improve customer service and overall responsiveness
• Establish the framework and boundaries within which IT management operates
• Standardize, Drive Common Consistent Policies and Processes.