I am not against reducing government costs . . . but I am not for increasing them mindlessly either.  I have written about this before (Shared Services in Government: 4 Reasons Not to Share and Dos and Don’ts of a Shared Services Strategy), but election time brings craziness and promises to balance budgets.  Many like to provide financial evidence that this works, rarely have I found this to be true.

Where is the evidence?

Supporters will show you that they had two or more “like” functions and combined them.  The financial savings are obvious.

But are they?

Not really.  Here is what we have found in the United Kingdom on some IT-led shared services projects:
• The shared services programme for the UK Research Councils – sharing IT, HR and finance – which was bought at £40m and is now forecast to cost £120m (and it ain’t over till the shared services work, which they don’t and probably won’t).
• Much the same has been reported with the shared services initiative at the Department for Transport. Sharing HR and finance was supposed to save the taxpayer £57m, but it is now on track to cost £81m.

Economies come from flow, not scale and too many political wags have got it wrong.  They want to reduce costs,  but pull all the wrong strings because they appear to make sense.  It is the ultimate waste of tax dollars.

Further, the financial and/or technology companies leading the charge to shared services are locking in waste.  The curious will read the articles above to understand why . . . as for the rest quit wasting taxpayer dollars.

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Make the new decade a profitable and rewarding one, start a new path here.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about how to get started at tripp@newsystemsthinking.com.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.

Tripp Babbitt is a columnist (Quality Digest, PSNews and IQPC), speaker, and consultant to private and public service industry.