Shared Services - Guidance Framework - Scottish Government

Shared Services Framework
Sourcing and Location
SECTION 4: Where?
The Scottish Government are committed to ensuring that we maXlmlse the
opportunities to deliver services efficiently and therefore location is a key
consideration. Where possible the opportunity to co-locate and maximise the use of
public sector assets where they are most cost effective is a priority.
As a starting point, a short, sharp review of the anomalies, weaknesses and
opportunities in the management of the Scottish Government's estate, has just
commenced. The Review is looking closely at all parts of the Scottish Governmentaround
80 recipients - comprising 'core' property centres, NDPBs, Agencies and
non-ministerial departments. The survey will ask key questions about the size legal,
financial and management arrangements and suitability of their estate.
This Review may provide us with a range of options in terms of how we might
maximise the location opportunities available to the public sector to ensure we get
value for money, from our buildings and land. While the first phase of the review is
the central government estate - that is those held and managed by the Scottish
Government, this will inform our efforts to improve asset management across the
whole of the public sector - including local authorities and the Thi"rdsector.
Options
The physical location of a Shared Services should be related to sourcing and not to
the operating structure. There are three basic location variations for a Shared
Services, i.e. where the work will physically be carried out, all three are used
extensively within the Private Sector with a move to off-shore locations being
preferred due to skills, resources and labour costs. However in the Public Sector the
common choice for location is on-shore local to the organisations.
• On-shore - Work is carried out in the same country but at a different location
• Near-shore - Work is carried out in a close location (e.g. continental Europe
relative to the UK)
• Off-shore - Work is carried out anywhere in the world that is not on-shore or
near-shore. This is not just to take advantage of wage arbitrage but to appreciate
the talents of particular economies in delivering specific service offerings.
The location variations can be applied to any of the operating structures and are not
linked to outsourcing. Current policy has no presumption in favour of outsourcing but
nor should the option be dismissed out of hand. Each case should be subject to an
option appraisal to determine the most cost effective delivery mechanism
commensurate with the business and user needs.
Technology innovation and cost reductions have greatly assisted in extending
sourcing and location options for Shared Services, e.g. the reduction in cost and
increased resilience for networks together with multi-channel access has afforded
Shared Services organisations with many different options for operating and
delivering services to their customers.
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