Shared services require companies to centralize their support services into one location, whether that’s in-house or outsourced to a shared service provider. The site is responsible for performing all the department functions required to successfully run the entire company across multiple locations.

According to a PwC survey, there are 3 main models that companies adopt for shared services;

1. The centralized approach: this approach has a single center that provides all business support services to the company’s operations. This is the most cost-effective model, however, it is the most challenging to execute because it requires extensive operational restructuring.
2. The centers-of-excellence approach: in this approach, specific business processes are located in different locations, based on the branch’s best performing department. For example, in the MENA region, accounts payable may be delivered throughout the region from UAE, while sales function through Saudi Arabia.
3. The regional clusters approach: in this approach, shared services are provided per region. Many companies view this as a step towards a fully centralized approach. For example, one shared service center will be responsible for the MENA region, whilst another is responsible for Europe.

Shared services improve cost efficiency, service levels, and market competitiveness of companies. As the country looks to grow the private sector, we have seen an increased interest in shared service centers in Saudi Arabia and expect this to continue.

For consulting on shared services or to discuss outsourcing your services, contact Proven at +966 11 411 1127 or [email protected].