{"id":268,"date":"2019-05-28T22:40:00","date_gmt":"2019-05-28T22:40:00","guid":{"rendered":"https:\/\/devinsighthub.wpengine.com\/business\/au\/?p=268"},"modified":"2023-05-15T04:47:19","modified_gmt":"2023-05-14T23:17:19","slug":"corporations-shared-service-centers-are-moving-up-the-value-chain","status":"publish","type":"post","link":"https:\/\/insight.thomsonreuters.in\/business\/posts\/corporations-shared-service-centers-are-moving-up-the-value-chain","title":{"rendered":"Corporations\u2019 shared service centers are moving up the value chain"},"content":{"rendered":"\n

Andrew Hay<\/a>  Head of Proposition, Statutory Reporting and Shared Service Centers at Thomson Reuters<\/strong><\/p>\n\n\n\n

As companies’ shared service centers become a more valued part of business, they’re paving the way for automated, centralized financial reporting and tax compliance.<\/h3>\n\n\n\n

Multinational companies are accelerating efforts to establish and optimize shared service centers \u2014 with finance & accounting leading the way, according to the State of the Global Shared Services Market Report 2019<\/em><\/a>, recently released by the Shared Services & Outsourcing Network<\/a> (SSON).<\/p>\n\n\n\n

This development bodes well for corporations\u2019 ability to centralize and streamline financial reporting and tax compliance across their global enterprise. Companies that are late to the game, on the other hand, may face a long-term competitive disadvantage.<\/p>\n\n\n\n

The shared services model came on the scene in the 1980s to improve efficiency and standardization in back-office functions. In recent years, it has taken on new importance \u2014 moving beyond transactional, manual work and focusing on automation, innovation, analysis, and process. \u201c(S)hared services organizations have been \u2018moving up the value chain\u2019 \u2014 something that was promised for many years but is now accelerating,\u201d says the report. \u201cWhat defines the modern center are the insights it offers the business based on a thorough understanding of services processing, automation, and data analytics.\u201d<\/p>\n\n\n\n

That\u2019s not to say increased efficiency is no longer an objective. In SSON\u2019s survey of organizations that have adopted this model, nearly half said they plan to improve productivity targets 5% to 10% in the next 12 months; and one-in-four are shooting for more than 10%. \u201cThe consistent, aggressive commitment to productivity improvements are keeping\u2026 leaders focused on innovative solutions that improve effectiveness, efficiency and performance,\u201d the report notes. \u201cToday, that is predominantly achieved by leveraging automation and data analytics.\u201d<\/p>\n\n\n\n

Survey respondents said the functional area most commonly managed in their shared service environment is finance & accounting (52%), followed by human resources (48%) and information technology (39%). For tax & finance teams, a shared service center automates repeated, scalable processes, creates consistency, and establishes a trusted source of information, which is a critical prerequisite for data analytics.<\/p>\n\n\n\n

Many companies have made the leap to a shared service center recently \u2014 17% are currently planning to launch and 27% are in the early launch stage. Those companies with more experience say they are augmenting what they have learned with automation and data analytics to reposition the center as \u201cthe brains of the enterprise.\u201d<\/p>\n\n\n\n

This mirrors the experience of Thomson Reuters\u2019 multinational clients, at least half of whom are using or planning for a shared service center to manage tax compliance or financial reporting across multiple disciplines. Some key areas include:<\/p>\n\n\n\n