Economy of Scale is a Myth, Why shared services don't deliver
Shared services are being introduced into organisations at an increasing rate. They are based on the assumption of economies of scale through centralisation and standardisation. But the evidence
suggests that these benefits do not necessarily follow....
This paper discusses how to achieve customer focus and manage costs. Dr Norman Chorn discusses the dilemma of needing to reduce costs while servicing more markets.
Understanding why shared services fail to produce efficiency is also presented through the following topics:
- Economy of scale has only a limited impact on people working in a knowledge based service organisation
- Standardised services only rarely meet the needs of different customer requirements
Is there a solution? Download this paper to find out more.