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ACCA Strategic Professional · Strategic Business Leader · Enabling success: organising

Halvorsen Retail has finance, HR and IT support teams duplicated in each of its six regional divisions. Directors propose consolidating these transactional activities into one internal unit that serves all divisions and charges them for services under agreed service levels. Which organisational arrangement does this describe?

This is a shared service centre. Duplicated support activities are pooled into a single internal unit that serves all divisions under service level agreements, giving economies of scale and consistency, while remaining within the group rather than being transferred to an external supplier.

  1. AA shared service centreCorrect
  2. BOutsourcing to an independent supplier
  3. CA matrix structure
  4. DOffshoring through a joint venture

Explanation

Consolidating duplicated support activities into one internal unit that serves the divisions under service level agreements is a shared service centre. Outsourcing would involve an external supplier, which is not proposed here. The unit remains inside the group.

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