Delivering the promised benefits of Shared Service Optimisation
How we helped reduce IT operating costs by 25% following deployment of a shared services business model
A European financial institution had decided to create a shared services organisation within the UK based on the IT systems, infrastructure & operations of three UK-based businesses with combined IT spend of £150+ million.
The challenge was to significantly reduce overall IT spend by at least 20% whilst improving IT service delivery and customer service provided to the 3 UK businesses clients.
The original cost reduction strategy and plan fell substantially short of the savings target and was based on high-risk complex integration projects. The UK business units were skeptical that the shared service organisation could deliver on the complex strategy which itself fell someway short of what was needed in terms of cost reduction and service improvements.
We formed a joint team with secondees from the UK businesses to develop a more ambitious savings target which came with a substantially reduced execution risk. Significant savings were delivered from procurement and operational efficiency improvements which were relatively straightforward to deliver.
The end result was an integrated cost reduction and service improvement program which reduced IT operating costs by 25% (£38 million) whilst delivering improved service and capabilities for the 3 UK businesses.