What Is a Shared Services Center (SSC)? Definition, Benefits & How It Works

As organizations grow, managing support functions separately across departments, subsidiaries, or business units can become increasingly difficult, Different teams may follow different processes, duplicate similar work, use separate systems, and allocate resources inefficiently.

A Shared Services Center (SSC) provides an alternative operating model by bringing common business functions into a centralized service structure, Instead of each department managing the same administrative activities independently, selected services are organized and delivered through one coordinated model.

This article explains what a Shared Services Center is, how it works, the services it can provide, its potential benefits and challenges, and how businesses can determine whether a shared services model is suitable for their operations.

What Is a Shared Services Center?

A Shared Services Center (SSC) is a centralized organizational structure that provides standardized support services to multiple departments, business units, subsidiaries, or entities within an organization.

Rather than allowing each department to manage functions independently, an SSC consolidates selected activities into a shared structure responsible for delivering those services consistently.

For example, instead of every business unit maintaining separate teams for payroll, recruitment administration, accounting support, IT assistance, or other routine activities, these functions can be coordinated through a central service model.

The purpose is to reduce unnecessary duplication, improve process consistency, centralize expertise, and create clearer ways of managing recurring business activities.

A Shared Services Center may support a single organization with multiple business units, a group of companies, or businesses working with an external shared services provider.

The specific structure depends on the organization’s size, operating model, locations, and service requirements.

How Does a Shared Services Center Work?

A Shared Services Center works by identifying business functions that can be delivered more efficiently through a centralized structure.

The process usually involves reviewing existing operations, identifying duplicated activities, standardizing workflows, and defining how services will be delivered to different departments or business units.

Although every organization may structure its SSC differently, the operating model generally follows several stages.

Identify Functions Suitable for Centralization

The first step is determining which activities are suitable for a shared services model.

These are usually functions that are repetitive, administrative, process-driven, or required by multiple departments.

Examples may include:

• Payroll administration
• Recruitment coordination
• Employee record management
• Accounting support
• Invoice processing
• IT support
• Data management
• Procurement administration
• Marketing operations
• Customer support activities

Not every business function should necessarily be centralized. Strategic decisions and activities requiring direct local management may remain within individual business units.

Assess Existing Processes

Before centralizing services, organizations need to understand how those services are currently delivered.

This may involve reviewing:

• Existing workflows
• Staffing structures
• Technology systems
• Service costs
• Processing times
• Error rates
• Reporting processes
• Responsibilities between teams

The purpose is to identify duplication, inconsistencies, bottlenecks, and opportunities for improvement.

Standardize Workflows

Once processes have been reviewed, the organization can establish more consistent procedures.

Standardization may include defining:

• Required steps for each process
• Roles and responsibilities
• Approval procedures
• Documentation requirements
• Technology systems
• Reporting standards
• Escalation processes

This helps ensure that similar activities are handled consistently across the organization.

Centralize Resources and Technology

The SSC brings together the people, systems, and resources required to deliver the selected services.

Depending on the operating model, this may involve creating a dedicated team, implementing centralized technology platforms, or working with an external service provider.

Centralization can make it easier to manage workloads and allocate specialized resources where they are needed.

Establish Service Levels and Responsibilities

A Shared Services Center should operate with clearly defined responsibilities.

Service level agreements, internal procedures, and performance expectations can help business units understand:

• What services are available
• Who is responsible for each activity
• Expected response times
• Escalation procedures
• Reporting requirements
• Quality expectations

Clear responsibilities are essential because centralization without defined ownership can create confusion rather than efficiency.

Monitor Performance

An SSC requires ongoing performance monitoring.

Management should review whether services are being delivered according to agreed standards and whether the model continues to meet business requirements.

This may involve tracking performance indicators, service timelines, error rates, user satisfaction, and operational costs.

Continuously Improve the Model

A Shared Services Center should not remain static.

As the organization grows, technology changes, or service requirements develop, processes may need to be adjusted.

Continuous improvement can involve automation, workflow redesign, technology upgrades, staff development, and changes to the range of services provided.

What Services Does a Shared Services Center Provide?

The services provided through a Shared Services Center depend on the organization’s structure and requirements.

However, SSCs commonly support administrative and operational functions that are used across multiple departments or business units.

Human Resources

Human resources is one of the most common functions supported through a shared services model.

Centralized HR services can help organizations manage recurring employee-related activities through more consistent processes.

Services may include:

• Recruitment coordination
• Employee onboarding
• Payroll administration
• Employee record management
• Leave administration
• HR documentation
• Training coordination
• Performance management support
• Employee reporting

Organizations that need additional support in these areas can also explore dedicated HR outsourcing services when determining the most appropriate delivery model for their workforce requirements.

Finance

Finance activities can also benefit from centralized processes, particularly when multiple departments or entities follow similar financial procedures.

Shared finance services may include:

• Accounting support
• Bookkeeping
• Accounts payable
• Accounts receivable
• Invoice processing
• Expense administration
• Budget support
• Financial reporting
• Data consolidation

Centralizing selected finance activities can help organizations create more consistent processes and improve visibility across different business units.

Information Technology

IT services are often well suited to a centralized delivery model because multiple departments may require access to similar technical resources and support.

Services can include:

• Technical support
• Help desk services
• Network administration
• System monitoring
• Software management
• Data management
• Cybersecurity support
• Application maintenance
• Technology implementation support

A centralized IT structure can help organizations coordinate technology resources more effectively while providing consistent support across the business.

Marketing

Some organizations also centralize selected marketing activities, particularly when several business units require support with similar campaigns, digital channels, or content requirements.

Marketing services may include:

• Digital marketing coordination
• Search engine optimization
• Content management
• Social media management
• Advertising support
• Market research
• Campaign reporting
• Brand coordination

The level of centralization depends on how much independence individual brands or business units require.

Operations

Operational support can also be delivered through a Shared Services Center.

This may include:

• Process administration
• Procurement support
• Documentation management
• Quality monitoring
• Customer service support
• Business continuity planning
• Process improvement
• Reporting and data coordination

Centralizing these activities can help organizations create clearer workflows and reduce duplicated administrative work.

Why Do Companies Use Shared Services Centers?

Companies use Shared Services Centers for different reasons depending on their size, structure, and operational challenges.

The goal is not simply to move employees into one department. A successful SSC should improve how services are delivered across the organization.

Reduce Duplicated Work

When several departments perform similar administrative tasks independently, the organization may duplicate resources, systems, and processes.

A centralized model can reduce unnecessary repetition by creating one structure responsible for common services.

Improve Process Consistency

Different business units may develop different ways of handling similar activities.

This can create inconsistencies in documentation, approvals, reporting, and service quality.

Shared services can introduce standardized processes across the organization.

Improve Service Quality

A dedicated service structure can allow teams to focus on specific processes and develop greater expertise in recurring activities.

Clear procedures and performance monitoring can also help identify areas requiring improvement.

Centralize Expertise

Instead of distributing specialized knowledge across multiple departments, organizations can create centralized teams with responsibility for specific functions.

This can make expertise more accessible to different business units.

Support Business Growth

As organizations expand, their administrative requirements usually become more complex.

A scalable shared services structure can help support growth without requiring every new business unit to build an entirely separate support function.

Improve Data and Reporting

Centralized processes can make it easier to collect and organize information from across the organization.

This can support management reporting and provide better visibility into operational activities.

Allow Business Units to Focus on Core Activities

When routine support functions are handled through a dedicated structure, departments may have more capacity to focus on activities directly related to their strategic and commercial responsibilities.

Who Can Benefit From a Shared Services Center?

A Shared Services Center can be suitable for different types of organizations.

The model may be particularly relevant for businesses experiencing duplicated support functions or increasing administrative complexity.

Growing Businesses

Growing companies may reach a point where informal administrative processes are no longer sufficient.

An SSC can help establish more structured processes as employee numbers, departments, and operational requirements increase.

Companies With Multiple Business Units

Organizations with several subsidiaries, divisions, or business units may perform the same support activities multiple times.

Centralizing selected functions can reduce duplication and create greater consistency.

Regional or International Companies

Businesses operating across multiple locations may need a coordinated approach to administrative and operational support.

A shared services model can help standardize selected processes while allowing local teams to retain responsibility for location-specific activities.

Organizations With Duplicated Support Functions

If multiple departments maintain separate teams performing similar tasks, an SSC may provide an opportunity to consolidate those activities.

Businesses Entering New Markets

Companies expanding into new locations may not always need to immediately establish complete support functions in every market.

A shared services structure can provide centralized support while local operations develop.

Companies Seeking Greater Process Control

Organizations experiencing inconsistent workflows, unclear responsibilities, or limited visibility into administrative performance may benefit from reviewing whether centralization could improve their operating model.

What Are the Benefits of a Shared Services Center?

The benefits of an SSC depend on how effectively the model is designed and implemented.

Potential benefits include:

• Reduced duplication of administrative activities
• More consistent processes
• Clearer responsibilities
• Improved coordination between departments
• Centralized expertise
• Better access to operational data
• Greater scalability
• More structured performance monitoring
• Improved process visibility
• More efficient allocation of resources

However, these benefits are not automatic.

The results depend on the quality of implementation, the suitability of the selected functions, the technology used, and the organization’s ability to manage change.

For a more detailed discussion of this topic, organizations can also explore the advantages of a Shared Services Center and how the model can support long-term operational development.

Shared Services Center vs. Outsourcing

Shared services and outsourcing are often discussed together, but they are not the same operating model.

A Shared Services Center focuses on centralizing services that support multiple parts of an organization.

Outsourcing involves assigning selected business activities to an external provider under an agreed service arrangement.

Shared Services Center	Outsourcing
Centralized service delivery model	External service delivery arrangement
May be internal or externally managed	Usually delivered by a third-party provider
Can serve multiple departments or entities	Provider delivers agreed services to the client
Focuses on centralization and standardization	Focuses on delegating selected functions
Can form part of the organizational structure	Usually operates through a contractual relationship

In some situations, organizations may combine both approaches.

For example, a business may centralize its HR or finance processes while working with an external provider to deliver some of those services.

The appropriate model depends on the organization’s internal capabilities, operational requirements, and strategic objectives.

Businesses considering external support should evaluate how outsourcing management fits into their wider operating structure.

Shared Services Center vs. Business Process Outsourcing

A Shared Services Center and Business Process Outsourcing, often referred to as BPO, can both involve centralized service delivery, but their structures are different.

An SSC is generally designed around providing common services to multiple parts of an organization.

BPO involves contracting specific processes to an external service provider.

Shared Services Center	Business Process Outsourcing
Focuses on centralizing internal support functions	Focuses on outsourcing specific business processes
May operate within the organization	Delivered by an external provider
Serves multiple business units	Services are delivered under a client-provider agreement
Organization maintains greater structural involvement	Provider manages the outsourced process according to the agreement
Often focused on internal standardization	Often focused on external process delivery

The two models can sometimes overlap.

An external provider may operate a shared services structure on behalf of clients, while an internal SSC may also work with specialized outsourcing partners for selected functions.

What Challenges Can Companies Face When Implementing an SSC?

Although a Shared Services Center can provide important operational benefits, implementation can also involve challenges.

Organizations should understand these challenges before centralizing major functions.

Change Management

Employees and managers may need to adapt to new processes, reporting structures, and responsibilities.

Resistance to change can slow implementation if communication and transition planning are not managed effectively.

Process Standardization

Different departments may have developed their own procedures over time.

Bringing these processes into one standardized model can require significant review and coordination.

Technology Integration

An SSC may depend on centralized technology platforms.

Integrating different systems, databases, and reporting tools can create technical challenges.

Data Security

Centralizing information may increase the importance of access controls, data protection procedures, and cybersecurity measures.

This is particularly important when handling employee records, financial information, or confidential business data.

Service Quality Management

Centralization does not automatically guarantee better service.

Organizations need clear performance standards and monitoring systems to ensure the SSC continues to meet the requirements of internal stakeholders.

Defining Responsibilities

Confusion can arise when the responsibilities of the SSC and individual business units are not clearly defined.

A successful model requires clear ownership and escalation procedures.

How Can Companies Overcome SSC Implementation Challenges?

Successful implementation usually begins with careful planning.

Organizations should avoid treating shared services as a simple restructuring exercise.

Important steps include:

• Assessing existing processes before centralization
• Clearly defining the scope of services
• Communicating changes with affected teams
• Establishing clear roles and responsibilities
• Introducing appropriate technology
• Setting realistic service levels
• Monitoring performance after implementation
• Reviewing and improving processes continuously

A phased implementation may also help organizations manage change more effectively.

Instead of centralizing every function at once, a company may begin with selected services and expand the model after evaluating performance.

How Do You Measure Shared Services Center Performance?

An SSC should be measured against clear operational and service objectives.

The most appropriate key performance indicators will depend on the services provided.

Common metrics may include:

Cost per Transaction

This can help organizations understand the resources required to complete recurring activities.

Processing Time

Processing time measures how long specific tasks take from initiation to completion.

Service Level Agreement Compliance

SLA compliance helps determine whether services are being delivered within agreed timelines and standards.

Error Rate

Monitoring errors can help identify weaknesses in processes and opportunities for improvement.

First-Time-Right Rate

This measures how often a process is completed correctly without requiring additional corrections or rework.

Automation Rate

Automation metrics can help organizations understand how much of a process is completed through technology rather than manual activity.

Internal Customer Satisfaction

Business units and employees using shared services can provide feedback about service quality, communication, and responsiveness.

Productivity

Productivity indicators can help management understand how efficiently teams are managing workloads.

The goal should not be to measure every available metric.

Organizations should select KPIs that reflect their service objectives and support practical decision-making.

How Shared Services Centers Support Business Growth

As companies expand, administrative complexity often increases.

New employees, departments, locations, and business units can create additional pressure on internal support functions.

A well-designed Shared Services Center can provide a more scalable structure for managing these requirements.

Instead of recreating the same support capabilities in every new business unit, organizations can expand an existing centralized structure.

This may support:

• New market expansion
• Workforce growth
• Additional business units
• New operational locations
• Increased transaction volumes
• More complex reporting requirements

However, scalability should be considered during the initial design of the SSC.

A structure designed only for current requirements may require significant changes as the organization grows.

Businesses planning regional or international expansion may also benefit from understanding how Shared Services Centers can support global growth and cross-border operations.

How Hauberk Consulting Supports Businesses Through Shared Services

Hauberk Consulting supports businesses looking to centralize and improve essential support functions through shared services and outsourcing solutions.

The approach begins with understanding the organization’s existing operating structure, administrative requirements, and areas where duplicated work or inconsistent processes may be creating challenges.

Depending on the business requirements, support may cover key functions including:

• Human resources
• Finance
• Information technology
• Marketing
• Operations

The appropriate model depends on the organization’s size, workforce structure, existing internal capabilities, and long-term objectives.

Rather than assuming every business requires the same level of centralization, the scope of support can be assessed according to the specific functions that would benefit from a more coordinated service structure.

This can help organizations determine which activities should remain within individual departments and which may be suitable for centralized or externally supported delivery.

Key Takeaways

A Shared Services Center is more than a centralized administrative department.

It is an operating model designed to provide common business services through a coordinated and standardized structure.

The model can help organizations reduce duplicated work, improve consistency, centralize expertise, improve reporting, and create a more scalable approach to managing support functions.

However, successful implementation requires more than combining teams into one location.

Organizations need to review their existing processes, define responsibilities, establish service standards, introduce appropriate technology, and monitor performance over time.

The most suitable SSC model will depend on the organization’s structure and operational requirements.

Some companies may centralize services internally, while others may combine shared services with external outsourcing support.

The key is to design a model that supports the organization’s long-term business objectives rather than simply reorganizing existing administrative activities.

Frequently Asked Questions

What is a Shared Services Center?

A Shared Services Center is a centralized organizational structure that provides standardized support services to multiple departments, business units, or entities. Common functions may include HR, finance, IT, operations, and other administrative services.

What services are provided by an SSC?

An SSC can provide services across human resources, finance, information technology, marketing, operations, procurement, administration, and other recurring business functions.

What are the benefits of a Shared Services Center?

Potential benefits include reduced duplication, improved process consistency, centralized expertise, better reporting, clearer responsibilities, and greater scalability.

What is the difference between an SSC and outsourcing?

An SSC centralizes services within a coordinated operating model, while outsourcing involves delegating selected services or processes to an external provider. Organizations can also combine both approaches.

Is a Shared Services Center suitable for SMEs?

It can be. Growing SMEs with increasing administrative complexity or duplicated support functions may benefit from a centralized service model. The structure should be adapted to the size and requirements of the business.

What is the difference between SSC and BPO?

An SSC centralizes common services for multiple parts of an organization. BPO involves contracting specific business processes to an external provider.

How do companies measure SSC performance?

Companies can measure performance using indicators such as processing time, cost per transaction, SLA compliance, error rates, automation rates, productivity, and internal customer satisfaction.

Can an SSC support international business growth?

A Shared Services Center can provide a centralized structure for supporting multiple locations and business units, This may help companies manage administrative requirements more consistently as they expand.

How do you establish a Shared Services Center?

The process generally involves identifying suitable functions, reviewing existing processes, standardizing workflows, centralizing resources, establishing service levels, introducing appropriate technology, and monitoring performance.

Ready to Explore a Shared Services Model?

If your organization is dealing with duplicated support functions, inconsistent processes, increasing administrative workloads, or rising operational complexity, it may be time to review how essential business services are structured.

Hauberk Consulting can help businesses assess their current operating model and explore whether a Shared Services Center, outsourcing arrangement, or combination of both approaches is suitable for their requirements.

Contact Hauberk Consulting to discuss your operational structure and explore a practical approach to centralizing essential business services.