Commercializing Shared Services.
To find out what would lie ahead for those that wanted to give it a try, Gunn Partners surveyed their clients and others. What they found was that almost half the companies were considering commercialization, but only about 10% thought they and others would be successful. Even those that don't decide to "go commercial" will be forced to become commercially competent to continue their current operations and services.
A key thing to remember, Gunn Partners says, is that there are three main ingredients for success in a commercialization endeavor, and without each of them, a company probably will fail. They are:
* A market offering that's compelling or unique.
* An entry strategy that's well suited to a company's capabilities and the needs of potential clients.
* Organizational capability to execute according to the requirements of the business model.
Three steps executives can take now to ensure their organizations' success into the future, the group notes, are:
* Become commercially competent, which means running their shared services as a business. Without a dedicated business development manager focused on securing new business, this won't happen.
* Open up to external competition. Only 20% of the companies Gunn Partners surveyed allow their shared services clients to select which services they want, and only 15% let clients buy services externally, which, the group says, means these companies are really operating in a captive market, not an open market.
* Create an independent business unit, which means setting the unit up as a separate legal entity. If a company is going to compete externally, it must be an independent operation with no perception of favoritism to the parent organization.
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|Title Annotation:||elements to consider to increase success|
|Article Type:||Brief Article|
|Date:||Oct 1, 2001|
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