Benefits of Implementing Shared Services among State Owned Enterprises in South Africa

Abstract

Shared services have gained the interest of politicians and public administrations to improve efficiency. Shared services involve the convergence and streamlining of an organisation’s functions to ensure timely service delivery as effectively and efficiently as possible. The idea of shared service is driven by the benefits such as cost reduction and improvements in quality levels of service. As such a shared service centre promises economies of scale and scope. Due to commoditisation of large information systems, many common, supporting functions across organisations are becoming more similar than not, leading to an increasing overlap in processes and fuelling the notion that it is possible for organisations to derive benefits from collaborating and sharing their common services through an inter-organisational shared services arrangement. South African state owned enterprises; the main contributor to the economy of South Africa requires such an arrangement. This research identifies some of the benefits of implementing the shared services among the state owned enterprises in South Africa. The research methodology used for this study was qualitative analysis in order to identify the benefits of implementing shared services. The data was collected by interviewing employees of the state owned enterprises who were once part of an inter-organisational shared service organisation, arivia.kom. One of the key findings from this research was that there are benefits of implementing shared services among state owned enterprises. Based on the key findings, a variety of recommendations were made to the South African public departments and state owned enterprises