Shared services ‘boost’ needed

IRELAND will be a key target for the one-in-three global companies considering relocating parts of their business.

The latest Deloitte Global Shared Services survey revealed that shared services operations in Ireland must quickly focus on more value-added, knowledge centred activities in order to compete for business.

The study revealed that 40% of companies surveyed are considering relocating shared services centres.

A shared services centre refers to the establishment of a location for a specific service such as global HR operations or customer services.

The survey of over 130 international shared services leaders, including many with Irish operations also found that 29% are considering relocation within one to three years.

The reasons cited for the moves were to reduce costs (56%) and to improve service (28%).

Ireland has traditionally been a very attractive location for shared services centres due to its quality of labour and low cost base, according to consulting partner at Deloitte, Shane Mohan.

“There is no doubt that Ireland can compete in terms of labour quality, but as cost becomes an increasingly important factor, Ireland will have to compete at a more strategic level.

“Again the compelling argument is that shared services operations in Ireland must focus on more value added, knowledge centred activities — and they must do it quickly.”

Mr Mohan said shared services centres in mature economies such as Ireland are finding that high talent and low cost resources are becoming increasingly scarce — and this is forcing many organisations to rethink their location strategy.

“Ireland has had a good success rate in attracting shared service operations, and there is scope to continue to do so as the market evolves.”