Innovative shared services are transforming how we do business

Many economic experts believe that innovative shared services will not only transform consumer behaviours, but also affect the way in which businesses interact with their customers, key vendors and suppliers, and with employees in their organizations.

Shared services, such as Uber and Lyft have already brought lasting changes to taxi industry by offering ride-sharing services that have significantly reduced the cost of getting to your destination for consumers.  Airbnb, another shared service, has allowed property owners to offer their unused or vacant properties to travellers at much less cost than a traditional hotel.

Entrepreneurs are making life easier and services less costly for their customers by sharing unused capacity and common service platforms. Businesses have provided access to everything from underutilized warehouse and office space to construction equipment. And other shared service providers have created centralized platforms that include office reception services, legal services, IT services and cybersecurity services.

Estimates have global revenues from sharing sector companies from companies like Uber, Lyft and Airbnb at as much as $335 billion (USD) by 2025.

The share services trend in not just limited to the consumer markets as businesses are also jumping on this trend.  Small and medium-sized enterprises are benefiting considerably from the provision of shared service platforms. Traditionally, growing businesses often face an IT department roadblock – where they had to devote an outsized portion of their revenue to build a level of IT functionality comparable to that of larger companies, which could more easily afford the spend.  However, the day has come with share services that SMEs can have the same capabilities without the high costs on their operating expenses.

When SMEs use shared service providers for IT services such as cloud computing or cybersecurity, contracts can be formulated as pay-per-use services. Customers pay for only those services they actually use, and they can quickly scale up or scale down their consumption of those services depending on the needs of the business.

With shared service platforms cutting across all sectors and providing an ever-increasing range of services, competitive businesses need to examine their core competencies and decide which of their internal functions could prove more advantageous to outsource rather than try to do in house at a higher cost and just focus on growing their business.

By Jamie Barrie