Shared Services

The pros and cons of shared services

Anne Rung

GSA wants to ease out of offering shared HR services, says Anne Rung.

The Department of Homeland Security is about to unveil another shared service for federal users.

DHS's "Carwash" service is essentially a security scrub that will accelerate mobile applications development for other federal agencies, said Keith Trippie, executive director of the department’s enterprise system development office.

The application, which he said would become available in October, will check mobile apps' code, insure they meet standards for accessible use and will let app developers know about vulnerabilities that come to light as the app is used, allowing faster corrections of those weaknesses. The service will be offered at no charge for an initial 90 days, said Trippie. The agency is currently working out a pricing plan.

Trippie spoke as part of a panel at a shared-services forum in Washington, D.C., on Sept 12. The event illustrated the economic push and pull that shared services exert on federal agencies.

The forum, convened by the American Council for Technology/Industry Advisory Council, hosted a long list of speakers from federal agency shared services providers and suppliers who supplied economic and practical insight.

Anne Rung, associate administrator at GSA's Office of Governmentwide Policy, said her agency is moving away from offering shared human-resources services, having determined such services are not really among its core strengths. The agency will put more emphasis on acquisition, real estate and IT technology, said Rung.

GSA issued a formal request for information on Sept. 12 asking for advice on how to withdraw from HR. HR services provided by GSA, according to the agency's web site, include personnel management, personnel action processing, benefits and retirement services, training and education solution, specialized support for small agencies and financial management solutions. Rung told FCW that a time line for the withdrawal hasn't been finalized.

GSA's focus on a tighter core of shared services offerings and DHS's planned roll out was evidence of what federal CIOs and managers say is a continual interplay of economic and technological forces driving shared services.

A panel of federal agency leaders who have used shared services successfully to cut costs and increase efficiency, shed some light on why shared services can be a mixed blessing.

Tight financial times, said David Fisher, chief risk officer and senior advisor to the commissioner at the Internal Revenue Service, make sharing services more attractive for federal agencies pushed to find less expensive and more efficient ways of doing things. "Shared services are the key to survival," said Doug Nash, CIO at the Forest Service. "We used to do everything ourselves, including IT."

That changed, however. The agency began outsourcing its help desk after finding it unwieldy, he said, adding that he would rather focus on his agency's core duties than tinker with the intricacies of things like network management.

Fisher, who served as the chief administrative officer and chief financial officer of the Government Accountability Office until last May, said federal agencies have to be aware of some of the subtle challenges shared services can bring. Cloud-based shared services, he said, can change acquisition, shifting emphasis from capital expenditures on gear and networks to a longer view as agencies look for more efficiencies from streamlined IT operations.

"Procurement organizations may be struggling. It's a different kind of buy," said Fisher. "The payout is longer."

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Reader comments

Tue, Sep 17, 2013 CalchasPSS UK

In the UK shared services has been propounded as the solution to reducing public sector costs for years. Billions of £s have been thrown at trying to introduce. Money which has enriched the IT companies and traditional consultancies but has little. When you study shared services you find that the majority of savings come from improving services (something that doesn't require shared services). The claims for savings are almost always due to this improvement work. Whereas much of the cost and failure is down to standardisation and scale. In Australia it has cost hundreds of billions of $s and led to massive scandal. In the UK there's huge evidence of problems associated. If you have to share, study, learn, improve and then share (if you have to). I wrote this article and added lots of relevant evidence. http://calchaspss.wordpress.com/2012/11/15/the-biggest-cause-of-shared-services-failure/

Fri, Sep 13, 2013 Look Below the Surface

One of the attractive features for using shared services that was mentioned at the forum was the savings that can be generated by competing the SSP’s. Looking at the financial management offerings of the Federal SSP's, one wonders how much "real" cost saving is to be had considering the work being performed under the covers is by a very few large financial ERP contractors. In this case, the whole notion of savings in rather a sham. Federal leaders need to look below the surface at who – exactly – is performing their needed service as part of their business cases and to see if they will be able to really achieve any meaningful cost savings.

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