Shared Services Implementation and Its Impact on Employees

Tuesday, 12 July 2016
Location: Seminar 31 (Juridicum)
Distributed Paper
Petr MEZIHORAK, Faculty of Social Studies, Masaryk University, Czech Republic
The purpose of shared services centre is to centrally provide specific services in an organization whereas those services had previously been administered in more than one of organization’s parts. Actually, the centre is an embodiment of the fully-fledged (albeit polymorphous) management concept of shared services which is today among senior managers in multinational companies very popular and which consists of centralization, autonomization and standardization of all support processes to one or a few points. This concept is based on the one hand on economically rational arguments of economies of scale, economies of specialization and wage arbitrage but on the other hand it draws a support also from highly aestheticized vision of global business services model as of an instrument how to transform the corporation into “a giant which can dance” (I paraphrase the name of book When Giants Learn to Dance by Rosabeth Moss Kanter).

I claim that the implementation of shared services has a lot of not necessarily unintended but in any case not explicitly formulated consequences. I argue that the shared services concept serves as an instrument to disintegrate the organization and its activities in order to transform them and reintegrate again in the form of supply chain. However, the latter form of organization substantially differentiates from the previous one by several features, mainly by its emphasis on supplier-client nature of relationship which has serious impacts on employees and work in terms of increased pressure and insecurity and lower job quality and satisfaction. Work organization in the shared services centre and in its client departments is different, however, what is even more important is that it is possible to observe changes within client departments. The work content tends to be more specialized but less specific .The performance is increasingly controlled by the combination of quantitative and qualitative indicators.