We recently covered shared services for the first time in detail on Spend Matters PRO, examining the intersections of accounts payable, outsourcing and procurement, including detailed case analysis of what organizations including Fiserv and Eli Lilly are up to. Subscribers can access this series below:
When it comes to shared services, it's no surprise many organizations have gotten started with AP as a first wave initiative:
"AP automation and invoicing is a relatively easy target and first place to start. It is highly repetitive – [with] solid sources of metrics around volume, accuracy and turnaround time. Traditional AP management results in each fulltime employee processing between 5,000 and 10,000 invoices per year. With a broad e-invoicing initiative and consolidation into a shared service center, these numbers can increase to over 30,000 invoices per year per employee. Converting to full electronic archival (no paper copies stored once scanned) leads to additional benefits – searches, audits, storage space are vastly improved."
Yet AP is just one area of procurement that can benefit from shared services (and managed services) consideration. As we note, Fiserv observes, for example, a range of other areas that present a clear case for shared services (travel and expense, supplier/spend master data management, cash applications, etc.) and other areas may also be a fit based upon a range of considerations (management reporting, inventory accounting, project accounting, treasury reporting, planning and analysis, tax reporting, statutory reporting, etc.)
Beyond Procurian, Proxima and Accenture-style sourcing and category management, the best opportunity for shared services approaches in procurement (whether managed internally or outsourced to a third party) are likely those areas with a link into finance. Stay tuned as we continue to explore this topic later today. And click here for free "try before you buy" trial to Spend Matters PRO.