ACCA Strategic Professional · Strategic Business Leader · Finance transformation
Marlow Telecom is considering a shared service centre (SSC) for finance in a single location, serving all its divisions. Divisional managers fear a loss of responsiveness. Which of the following is the most likely benefit that the SSC model offers the group, alongside this risk?
A shared service centre typically standardises processes and gains economies of scale by consolidating transactional finance work in one place, reducing unit cost. The trade-off is reduced divisional responsiveness, which is normally managed with service level agreements, and board accountability for the accounts is unchanged.
- AStandardised processes and economies of scale in transactional activities, lowering unit costCorrect
- BGreater local autonomy for each division to choose its own systems
- CComplete elimination of the need for service level agreements
- DTransfer of legal accountability for the accounts from the board to the SSC manager
Explanation
An SSC consolidates transactional work, giving standardisation and scale economies. Service level agreements are normally needed to manage divisional concerns, and board accountability for the accounts is not transferred. Local autonomy over systems is reduced, not increased.
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