There are many levels of shared services, but the core concept of having a centralized organization within the enterprise that provides services to disparate, internal data consumers rests on the power of standardized business processes.
Ben Gaucherin, CTO of Sapient, tells me one of his company's clients, a telco equipment provider, had 93 different ERP systems before starting the consolidation process. And although financials are at the center of shared services, they now go well beyond that.
"We advise clients to look at it as, this is the way you need to drive IT overall," Gaucherin says.
But before trying to find a one-size-fits-all solution, let's first look at an important caveat. Not all ERP platforms can scale to the volumes of transactions that some organizations are going to throw at them. So consolidating several divisions on a single platform that won't scale is not a good idea, according to Gaucherin. A more reasonable alternative is to migrate over time and reduce the hodgepodge of platforms.
Of course, driving the move to shared services is the need to reduce costs by eliminating duplication as well as responding to the increased need for more relevant information about how well your company is performing.
I also spoke with Bret Fuller, senior vice president of IT applications at Oracle Corp. Are you surprised Oracle is still talking to me? Me too.
To get the visibility into data, you must find the degree of commonality between processes across lines of business and then automate those processes. Only then can you can see into and across all your operations. As Fuller puts it, "Your information becomes truly valuable because you are comparing apples with apples, margins from one country to another."
The biggest challenge is not deploying the technology needed to pull this off, it's getting buy-in from the line of business managers and all parties involved. Companies need to get a cross section of all the divisions in a single room, force them to talk to one another, and get them to say why some processes are the same and why others need to be different.
On the technology side, Fuller and Gaucherin seem to agree that it is all about business-process automation. A business-process-centric platform makes sharing processes easier. Of course, getting there is no small detail. From a cost standpoint, knowing which part of your processes need to change and which don't, and which are unique and which are not is not easy.
Gaucherin believes BPM (business process management) platforms are critical to a company's architecture. This is where you'll see how your company is performing.
Gaucherin might be right in thinking we are in the midst of a business process revolution. Take a look at what's happening with the big application vendors. Oracle and ERP vendors in general own many of these critical processes, so they have a legitimate claim on the BPM platform of the future. They are trying to make their applications more flexible. Witness SAP AG's NetWeaver and xApps .
Gaucherin, however, sees other players and other platforms, such as Microsoft Corp. BizTalk, IBM Corp. WebSphere MQ Series Workflow, BEA System Inc.'s WebLogic Integration, and Tibco Software Inc.'s ActiveEnterprise suite -- which come in at a higher level of the stack -- as serious contenders.
The economy, competition, and even compliance issues are all setting the course for IT and the way they power the company; the trick is not capsizing.