What should you do about the retained organisation?
Proservartner Point of View
For most shared services and outsourcing initiatives, there is a significant focus on the activities that are migrated from the existing location into the new location where activities will be performed.
The tendency is to have well trained people within the captive shared service centre / BPO delivery centre. Whilst that may work effectively, the retained organisation is sometimes forgotten. If then it becomes very difficult for the retained team to move into their new role.
This can impact an organisation long after the initial change, with a number of serious implications including:
- A poor brand for the shared services capability driven by issues being escalated in the wrong ways and increased amount of negative “PR” across the business
- A retained organisation being “what is left behind” rather than part of a fit for purpose team delivering the overall outcomes of the function / organisation
- Individuals in the retained organisation concentrating on the areas that they are most comfortable. For example holding onto transactional work which has migrated to the shared services environment rather than moving into their new roles
- Development of “shadow” organisations in the business carrying out activities that should be performed by the shared services team
- A “them” and “us” culture between the business and the retained organisation against the shared service centre / BPO partner
- Focus on telling the shared service centre what to do, rather than building talent in the capability
- Fear of job loss, leading to a culture of creating work and potential problems in the activities migrated
- Reliance on the key individuals in the retained organisation because the knowledge of query resolution resides in the minds of the individuals involved
- Deterioration of quality with the focus being on productivity and responding to the pressures from the retained organisation
For many organisations, the retained organisation becomes part of the problem because of these reasons, and the impact of the loss of staff and friends that had been working in the organisation for many years can cause sensitivity and distrust.
That said there is a solution; the organisations that get this right today consider the activities that are being left behind in as much detail as the activities that have been migrated, providing an end to end perspective on the ways of working.
Successful organisations measure success through the delivery of the functional or organisational outcomes rather than the tactical objectives of cost reduction and high levels of productivity.
This measurement allows a more holistic view of the capability and challenge as to whether that area of the business (retained and shared services capability) is delivering on the overall objectives, and if not, then driving an assessment of what has gone wrong rather than blaming the shared services capability!