Shared services not worth the time in public sector? It can't be true.

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I have written fairly extensively about shared services in the public sector.

It seems to make perfect sense for public sector organisations, which share common processes, should share the people and systems that complete these processes.

It is already happening across the public sector. There are examples in the NHS, the police and local authorities of organisations that have already taken the plunge. Recent research, by Chartered Institute of Public Finance and Accountancy, said that 96% of local councils are moving towards shared services.

But although examples such as the NHS Shared business service, have gone some way towards providing a business case for shared services in the public sector, not everyone is convinced.

Analyst company Ovum this week revealed the findings of research of public sector CIOs towards shared services.

It seems in Europe about half are concerned that the cost benefits are not enough to justify the major upheaval.  A quarter of the same group said that they would avoid shared services out of loyalty to existing staff, who could be surplus to requirements in a shared service.

A third of them were concerned about losing control.

I am interesting in hearing what IT professionals as well suppliers working in the public sector think of this.

3 Comments

"shared services" debate surely not just about IT back office - HR,finance must come into it. Also element of turkeys and Christmas here.

From your CW report:

Jessica Hawkins, analyst at Ovum, says ... "The move to shared services does involve upheaval and invariably means changing software applications, which in turn can require system and data migration and all the complexity that this entails. Many agencies have the perception that there is not enough money to be saved to make this worthwhile."

I think this is an important point. The government department where I currently work has multiple incompatible systems doing very similar tasks, which could in theory be streamlined and shared across different groups within the organisation.

Unfortunately, their internal politics, IT management, development processes and approach to system architecture and design are all phenomenally inefficient, bureaucratic, over-complicated, wasteful, inflexible and exorbitantly expensive. People are often working very hard, but their efforts are largely wasted. This creates the mindset that it is almost impossible to achieve anything without herculean effforts and enormous costs, so it is better to stick with the devil you know i.e. the current chaotic and costly mess. This perception is only confirmed by the history of disastrous public sector IT projects, where huge amounts of time, money and effort have achieved little or nothing of any benefit to the taxpayer.

You then also have to allow for the fact that the people who might decide to take a different approach are the same people who have invested a great deal of their own time, efforts and professional reputations (not to mention vast amounts of public money) in constructing the current situation, and are unlikely to collaborate in acknowledging these failures or reducing their own power or independence.

Public sector managers may believe that they are simply being cautious, perhaps risk-averse, but in all too many cases the greatest risk is actually to stick with current practices, especially at a time of budget pressures. So it would certainly be possible to streamline and share IT resources far more effectively in the public sector, which might actually free resources to achieve "more with less". But in order to achieve this, people must be prepared to change and "work smarter, not harder", something that is most unlikely given the culture of most public sector organisations I have encountered.

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This page contains a single entry by Karl Flinders published on May 27, 2011 12:16 PM.

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