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Hi All,

I have been asked this very question several times, so I decided to put together a really brief, quick breakdown of the two sourcing models:

First let's define both:

Shared Services is basically the centralization of back end/administrative functions and/or tasks (such as Accounts Payable, Travel expense payments, invoicing etc) either internal within an organization, outsourced to a service provider or a mix of the two. The Shared Service Center (SSC) then views the parent organization as a client/customer within itself.

Outsourcing: In a nutshell is the situation where an organization sub contracts a process, task, project or business unit to a third party supplier.

Thus there is some cross over in these models, however Shared Services is a multi-faceted approach which looks at the company as a customer rather than simply an outsourced service/product.

Both Shared Services and Outsourcing share very similar goals - reduce costs, leverage global resources (human, capital, technology, experience, economies of scale), increase efficiency - however Shared Services also looks at increasing the performance of the function in terms of quality, effectiveness and overall responsiveness to the organizations needs.

If you would like any further clarity on definitions, I suggest a quick visit to Wikipedia. For more information on Shared Services in practice, please visit our webiste

Thank you
Chris G

Tags: Outsourcing, SSON, Shared Services, bpo, offshoring, sourcing, ssonetwork

Views: 957

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