Change Management Strategy for Implementing Shared Services

Seminar paper from the year 2008 in the subject Business economics - Business Management, Corporate Governance, grade: 5 (excellent), University of Pécs (International PhD Program), course: Management I, language: English, abstract: Nearly all managers seek to improve the bottom line of their business in different ways. After off shoring of production facilities and outsourcing of processes, the Shared Services approach has heavily been discussed in previous years. With regard to Bergeron, the Shared Service business model can be defined as follows: ¿Shared Services is a collaborative strategy in which a subsets of existing business functions is concentrated into a new, semi-autonomous business unit that has a management structure designed to promote efficiency, value generation, cost savings, and improved service for internal customer of the parent corporation, like a business competing in the open market.¿ Following Wißkirchen, organisations try to achieve in general the following objectives via the implementation of Shared Services:

- Cost reduction due to economies of scale and scope, based on the standardisation and accumulation of internal processes in one unit

- The parent company can concentrate on the core of the business

- Creation, expansion and maintaining of process know-how

- Services are charged by transfer prices and are put into competition to external service providers

- So-called service level agreements exactly define what the parent company can expect. Hence, by implementing Shared Services, the back office functions, such as finance, accounting, controlling, human resources, regulatory affairs, etc. are becoming a strategic driver. The present assignment proposes a change management strategy, in order to overcome resistance to change, implement a new system and take the organisation back to equilibrium by referring to some of the basic models of management. Where appropriate, change management tools are recommended which might be used in order to make the right decisions at the right time.