How to Make Shared Services Work For You: 5 Key Steps

By Allan Watton on

Shared services can offer significant benefits – including improved savings, continuity and quality of service, systems and scalability – but only if you can overcome the challenges that will naturally appear when you ask service user parties with different goals, work environments and egos to play nicely together.

Shared Services, a great opportunity; fact or fiction..?

The idea that savings can be made through joining forces with others to benefit from the economies of scale and aspirations of sustainability, leading to cost reductions, the potential for innovations, improved services and saved time and resources is as old as procurement itself, but still there are some who are unaware of its uses. Just in the Local Authority environment alone, excluding the wider public sector or any private sector review, the Local Government Association stated that 626 partnerships at council level have saved over £1.34bn of taxpayer money in the year before Covid-19 hit.

Engaging in a shared services arrangement creates an intimate corporate relationship between the parties. Success relies less on the mechanics of the services to be shared and more on everyone’s commitment to understanding how critical the deep levels of personal engagement between each of the respective stakeholders is. Being keenly aware of this will assist in ensuring that you get collaboration from everyone you need and will avoid the possibility of your shared services relationships spinning out of control.

5 Steps to Make Shared Services Work Really Well

This article offers five key evidenced-based insights which you can use to steer your shared services relationship in a more productive direction.

Central to this are two foundational concepts that everyone is aware of, but often find hard to implement in every day operational life – ‘trust’ and ‘collaboration’. However, from other relationships we have reviewed, it has been evidenced that some clients can find themselves in a situation whereby both of these two concepts can be challenging to deliver on.

If your shared services partners have aspirations that are misaligned from your own, then tensions are likely to arise over time as each of you begin to pull in different directions. This is why it is so important to promote a form of cultural alignment, where each party does its best to ensure that all stakeholders are aware of the benefits gained through working together and to encourage a collaborative mindset from all concerned.

Benefits of Shared Services

If you are aligned with your strategic partners, there are many benefits for all of you to share. Having reviewed hundreds of large and complex relationships, there are usually nine primary benefits of adopting shared services that we find it is helpful to aspire to:

  1. Continuity and resilience of service
  2. Raising quality and adding value to existing services
  3. Securing cost savings and sustainable efficiencies
  4. Releasing staff time for more customer facing activities
  5. Improving systems scalability
  6. Ensuring improved and more ‘current’ systems
  7. Ability to offer otherwise unsustainable services, such as strategy and transformation
  8. Leveraging transformation
  9. Collaboration.

With such a variety of benefit options open to you and your shared services client partners, it’s important that you agree the areas common to you all.

We usually find that agreement on everything at the outset is unlikely, but a consensus on the main areas and objectives is a good start.

Building stronger shared services relationship foundations

If you are all aiming for the same destination, you will get there faster and with far more certainty.

Successful shared services relationships rely on open dialogue, shared vision and a commitment to everyone else in the relationship. This is simple to explain and incredibly difficult to achieve in the real world.

From the larger shared service relationships we have reviewed, there are 5-key steps to ensuring that the foundations for your shared services relationship are strong enough to build the trust and collaboration required.

    1. Understand the concept

The first step to developing a shared mindset in your shared services relationship is to understand your own, and everyone else’s, reason for entering into the relationship in the first place. What is driving the need/desire for change you are hoping to make?

Ideally, you would share your reasoning with your new collaborative partners, so everyone can understand each other’s underlying motivations and become more able to appreciate the bigger picture from everyone else’s perspective. Trust must be at the centre of your relationship as it is only though collaborative working that you will help your partners to achieve their organisational goals and in turn achieve your own. It is also vitally important to be realistic in these early stages, to not just discuss the positive aspirations of the relationship, but to also discuss the potential pitfalls, complexities and difficulties you see ahead.

It’s important, at the outset, to both understand and agree that entering into a collaborative shared service partnership is going to have its challenges. You need to find a common way forward, to bring your stakeholders with you, and recognise that everyone will need to trade some of their sovereignty for flexibility and the ‘greater good’ in the process. This acknowledgement of ‘letting go’ is tough for many individuals, but the only way of getting to the outcomes everyone is hoping for is through working together, openly, honestly and collaboratively.

    1. Understand your partners

Do you consider yourself to be trustworthy? This may seem like an odd question, but to earn the trust of others, your behaviour has to evidence that you yourself can be trusted. Everything you say and do should reflect the desire you have for others to believe that you are a genuine individual and that your organisation will follow suit.

In a group of clients in a shared services relationship, you need to follow through on your intentions in your everyday behaviours. Of course, not everyone will feel the same way, but to strive to build stronger relationships with your partners, to understand them and they you, will mean that when you wish to be heard, you will be, and when you wish to steer the partners in a particular direction, it is more likely you will achieve your common aims.

When trust is lacking there is a greater chance of protectionism creeping in and a reluctance of some to share control or to hand it over to others.

In a previous article titled ‘Rebuild Trust & Create More Productive Strategic Partnerships in 4 Steps‘ we highlighted,

    • to be open to trusting others,
    • to be trustworthy yourself,
    • to always be clear to avoid misunderstandings, and
    • to make others aware that you trust them, as primary ways to earn the trust of others.

The main aim being to help all parties to understand one another better so there is less of an opportunity for conflict in the future.

    1. Understand the opportunity

Once you are all clear about the underlying business objectives of why you and your partners wish to enter a shared services arrangement and a little more about who you’re going to be collaborating with, it’s important to assess how each of your organisations will change and improve, once you are achieving the benefits from the shared service.

Just because you know you are heading in the same direction does not mean that you are aiming at the same destination.

As you gain greater clarity of what you are all looking to improve, by how much and when, you can then determine what the likely challenges are that you may face in mobilising and implementing the services along the way. Bring together all the decision makers and come to an agreement on ‘what good looks like’ to everyone, find a quantifiable measure to identify the outcome you are all looking to achieve and agree it amongst yourselves.

This sort of ‘group thinking’ will help you to confirm that everyone’s on the same page and it sets the stage for future collaborative working. It’s also a good opportunity to identify those in the group who may resist a collaborative approach, so you can start to work on ways to draw them back into the process.

    1. Create a Shared Services Target Operating Model

When you have a group of disparate teams, departments or organisations working together in a shared services relationship, it’s vitally important that everyone is metaphorically singing from the same hymn sheet.

Create a document between you which clearly articulates your shared vision of the outcome you are all looking to achieve, the priorities of each party and even the compromises you have each agreed to in order to achieve these outcomes.

This Shared Services Target Operating Model should be a frank and open document, not only pointing out the benefits you aim to gain from the relationship, but also the downsides that you have agreed to compromise on for the greater good.

This document may also be used, in the absence of a suitable contractual agreement, to set out a ‘relationship charter’; the rules, roles and responsibilities of the relationship’s participants. What would happen if a party didn’t deliver as promised, the penalties if a party decided to leave the arrangement, and so forth. It should also set out the responsibilities and control parties have over certain priority areas and who will be leading in which services. It is vital that what is agreed is respected and that abuses are called out quickly to avoid behavioural patterns appearing.

    1. Establish a consensus

So, you’ve been clear, you’ve shared your vision, you understand your partners and you’ve documented the aspirations, expectations and risks of the relationship. Now you should ensure that all parties are as happy as they can be about it, that they buy-into it and that there is an unambiguous consensus from all stakeholders.

Assumptions should not be made. It’s best to keep asking all parties questions so that they can share concerns and find solutions, because it’s better to air issues early in the relationship when plans are still malleable. This open, honest and inclusive approach builds trust between all parties and that’s so important for the management of the project to come

Possible Challenges

Despite your best efforts, implementing the 5-steps above may still cause you some challenges along the way.

These may include:

  • The time it takes to establish and maintain satisfactory partnerships
  • Reluctance of partners to rely on a third party for service delivery
  • Concerns over loss of local control over critical services
  • Worries of issues if they wish to leave the partnership later
  • Reluctance to have data stored elsewhere
  • Politics between organisations may create uncertainty and distrust
  • Hokey-cokey partners who lose interest periodically
  • Lack of in-house skills to successfully initiate shared services.

Therefore, with these challenges still potentially in the works, it makes sense to minimise the risks even further and test your newfound collaborative group.

Walk through examples; scenario test with your partners (and supplier if you are using an external third party) in as much detail as possible, so you can identify sticking points, areas for improvement and, potentially, situations in which the wheels may well come off. If you can address issues at the design stage, then you can develop a more sustainable relationship going forward. It’s an excellent risk minimising strategy to test the plan before you launch into it in earnest, to stretch it to breaking point in the relative safety of a design and modelling environment.


The rewards of a well-planned, well-managed shared services arrangement can be significant, but to get there you need to appreciate the realities of human nature and have a strategy for dealing with them. People do not always work well together, ego, politics, protectionism, cultural misalignment and many other factors could conspire to create conflict rather than collaboration.

It is really important to identify why you are entering such a relationship and specifically what you are looking to achieve, to understand your partners and agree a written document (a relationship/service charter) that sets out all your expectations and compromises, that you all sign (yes – physically sign) up to. You’ll need to ensure that all your partners agree a course of action and keep on checking the alignment between you all at least every 6 months when you review your plan of actions against the reality of your relationship status.