One of the more important motives for an organization to open a Financial Shared Service Center (FSSC) is to improve efficiency which in turn is expected to lead to cost reductions. While the war on waste and squander is an important battle towards lean business processes, they sometimes manage to cast a shadow over other important aspects of cost reduction.
Cost Reduction through Quality Improvement
Often, the business case for opening an FSSC is approached from a position of cost reduction through highly skilled labor at a low cost. However, the effects of quality improvement of supportive services, communication and processes should not be underestimated. Optimizing processes of invoicing and accounts receivable can have a positive influence on cash flows and with it shareholder value. It will also provide more current and reliable information of costs and accurate insight on payments.
Optimizing processes and standardizing processes can also significantly reduce error recovery costs. Having these factors weighted in the business case, allows for a more accurate picture of the actual economic potential of an FSSC.
It is clear that decisions for opening FSSCs for an organization as a whole should extend to the calculation of cost reduction versus the investments. The base should be in the calculated impact the FSSC will have on the value of the business instead of just the costs associated.
The Future of Financial Shared Service Centers in CEE
If you are interested in learning how to take an FSSC to the next level, you should definitely consider joining The Future of Financial Shared Services.
The Future of Financial Shared Services is an exclusive WORLD-CLASS CEE knowledge sharing event, held in the very heart of Europe.
This Shared Services conference combines exceptional lectures, a distinctive concept of case studies and an inimitable atmosphere.