The professional association for public sector ICT management (Socitm) has called on the government to follow six defined principles for shared services projects if they are to succeed in cutting costs in the future.
Socitm’s latest report, entitled ‘Shared services time for a re-think?’, follows a National Audit Office (NAO) investigation that resulted in the government’s attempts to share central department back office functions being lambasted.
The NAO report said that “despite significant cost and effort, the planned benefits of the initiative have not been achieved”. It continued: “By creating complex services overly tailored to individual departments, government has increased costs and reduced flexibility.”
“There has also been a failure to develop the benchmarks necessary for measuring performance.”
Socitm states, however, that despite the disappointing outcomes, shared service ventures will continue to grow and government should follow its defined principles for success.
For example, organisations should assume that sharing services is one of the first options to consider, and that this sharing strategy should cover a range of approaches, including networks, data centres, applications, procurements, policies, skills and ICT managers.
Socitm also believes that the success of a shared services project, whether it is frontline or back office, largely depends on the willingness to standardise business processes.
Drawing directly on the criticism from the NAO report, Socitm states that benchmarking is also critical to indicate the scale of possible savings and the levels of service provided. It is also essential in measuring the benefits afterwards.
Each council or government department should also share its plans for future major procurements in order to avoid perpetuating the current fragmented approach and to spot opportunities for significant sharing. This sharing of procurement should be done locally and also across the UK, according to Socitm.
Finally, larger and more formal sharing schemes should adopt a governance framework that ensures that the right objectives are set, achieved and measured.