Shared Services Organisation Design Statement of Work Template[1]

Shared Services Team Toolkit Information Document Reference: D20 1 Document Name: Organisation Design Statement of Work Brief Description: USAGE GUIDANCE Toolkit materials should only be used with due consideration to the context and requirements of the programme in question. Materials should not be directly applied ‘off the shelf.’ CATEGORY P 1. Example material – This material has been provided by a single public or private sector organisation. It represents one possible approach to a given shared service activity, and should therefore be used by Toolkit users as a validation /cross-reference /brainstorming aid. 2. Co-developed material – This material has been produced through the collaboration of the Shared Services team and multiple public sector organisations and /or private sector organisations. This represents a tried and tested approach to the shared services activity in question. 3. Best Practice material – This material has been extensively compared against multiple sources by expert resources, and represents the best available approach to the given shared services activity in the view of the Shared Services team Organisation Design Statement of Work Version 7.0 Page 2 of 20 Date Amended: Organisation Design Statement of Work Organisation Design Statement of Work Version 7.0 Page 3 of 20 Date Amended: Revision History Version Author Date Status 1.0 2.0 3.0 4.0 5.0 6.0 7.0 References Document Name Version Date Source Planned Changes Organisation Design Statement of Work Version 7.0 Page 4 of 20 Date Amended: Contents 1. DOCUMENT PURPOSE ...........................................................................................................................5 2. BACKGROUND ........................................................................................................................................5 3. SCOPE AND APPROACH ........................................................................................................................7 4. ASSUMPTIONS.......................................................................................................................................14 5. CONSTRAINTS & RISKS.......................................................................................................................14 6. PROJECT STRUCTURE AND ROLES.................................................................................................15 7. WORK STREAM PLAN AND MILESTONES.....................................................................................16 8. DELIVERABLES.....................................................................................................................................16 9. ILLUSTRATION OF KEY DELIVERABLES ......................................................................................18 10. NEXT STEPS ...........................................................................................................................................19 ANNEX 1: OVERVIEW OF THE XXX ORGANISATION DESIGN METHODOLOGY ........................20 Organisation Design Statement of Work Version 7.0 Page 5 of 20 Date Amended: 1. Document purpose 1.1 This document covers the statement of work (SoW) for the organisation design (OD) within the scope of the shared services project (SSP) for the xxx. a. It describes the work that is required during the detailed organisation design, covering the Shared Services Centre (SSC) and the retained HR and finance organisations. The detailed design from this phase of work should be at a sufficient level of detail to allow the implementation of the new structures in phase 5. b. The objectives and outputs of the organisation design workstream are aligned with the overall project objectives of cost reduction and providing more efficient and effective support services. These will be met by the workstream objectives of reduction in FTE through the creation of a SSC and professionalisation of the retained HR and finance organisations. 1.2 The contents of this document will be discussed and agreed with the HRDs, FDs and Design Authority. 2. Background 2.1 Following the Xxx board decision on 2X Month 2000 to proceed with a SAP solution, subject to consultation with Ministers, this project will now follow SAP’s standard implementation approach which recognises five phases: 2.2 The project team is currently completing the project preparation phase which will be finished at the end of Month. The work undertaken in xxx and Xxxx will cover team mobilisation, planning, preparation and kick-off activities to ensure that the business blueprint phase, which focuses on detailed design, can formally start in xxx. The detailed design will build on Project Preparation Business Blueprint Realisation Final Preparation Go-live and Support Month YY Detailed design Build and test Cutover Go-live Project scope, approach and infrastructure Month YY Month YY Month YY Organisation Design Statement of Work Version 7.0 Page 6 of 20 Date Amended: the high level design that formed part of the shared services blueprint reviewed by the project board on DD/MM/YY. 2.3 A brief outline of the key activities from the preparation phase is included below for completeness. Project preparation 2.4 To date the project has focused on completing phase one of the ASAP methodology, and this will be achieved by the end of MMM 200X. The objective of this phase is to complete the initial planning of the project, and define the project goals, scope and objectives. The phase will also identify and mobilise the project team, and complete all preparation activities to ensure a successful start to the Detailed Design phase. 2.5 Developing and designing the SSC organisation and the retained HR and finance functions will require involvement from all the business units as outlined in the section on Project Structure. c. Key activities for this phase include: 2.5.1 completion of planning, scoping and kick-off activities; 2.5.2 preparation of materials and scheduling workshops; and 2.5.3 mobilisation of the project team including their induction to the project. 2.6 Key deliverables in support of project preparation include: Organisation Design Statement of Work Version 7.0 Page 7 of 20 Date Amended: Deliverable Description Purpose Scope Outline of the scope of the OD work stream, primarily covering the SSC organisation and the retained HR and Finance functions. This document will clarify the scope of activities for the detailed design phase. Design Principles A set of agreed principles for the organisation design. To ensure there are fundamental principles which will drive the organisation design. Standards & Templates Document outlining the templates used by the OD work stream for the detailed design phase. This will include the purpose and objectives for each deliverable template and an outline of what the completed template will deliver. This document will provide clarity from the outset on what standards, templates and tools will be used to complete the deliverables for this phase. Kick Off Meeting A kick off meeting was held with the HR and Finance Directors. The objective of the meeting was to: § Ensure a common understanding of project objectives, benefits and outcomes; § Ensure a common understanding of the high level roles within the new operating model; § Confirm the high level plans & activities for the detailed design phase, and resources required for delivery; § Ensure key stakeholders understand their role in the delivery of the detailed design phase; and § Confirm the design principles that will underpin the organisation design. The kick off meeting was to get the key stakeholders (HR and finance) at a common level of understanding prior to the detailed design phase. And so that they understand their roles in completion of the phase, agree the design principles and scope of work. 3. Scope and approach Scope of work 3.1 The scope of this workstream includes all those activities required to detail the various components of the support services organisation design listed below: 3.1.1 Shared Service Centre; 3.1.2 Business Partner (or retained HR and finance functions); 3.1.3 Corporate; and Organisation Design Statement of Work Version 7.0 Page 8 of 20 Date Amended: 3.1.4 Centres of Excellence (CoE). 3.2 The scope of the organisation design work for the next phase can be summarised as: 3.2.1 Shared Service Centre: a. finalise and validate the design principles; b. develop the SSC organisation structure including reporting relationships, spans of control, roles and responsibilities; c. develop a competency framework for the SSC, including the core and functional competencies by level; d. determine the detailed staffing requirements for the SSC – skill levels and FTE numbers required; e. complete a job matching exercise to assess the gap between the existing people profiles and new skills and capabilities required. This will determine the extent of recruitment/redundancy; f. define the interfaces and interdependencies of the various components of the support services organisation design; g. define the service delivery framework including key performance indicators (KPIs) and service level agreements (SLAs) for all HR and finance processes; h. determine the charging mechanism; and i. Define the transition plan. 3.2.2 Business Partner (retained HR and finance organisations): a. facilitate, where required, development of the retained structures by providing guiding principles and best practice input towards professionalisation of the functions; b. define the roles that will interface with the other components like SSC and CoEs; Organisation Design Statement of Work Version 7.0 Page 9 of 20 Date Amended: c. identify and document the change in line manager roles with respect to the new organisation design; and d. validate the FTE numbers. 3.2.3 Corporate: a. define the role of Corporate and its interfaces with the other components of the organisation design. 3.2.4 CoEs: a. identify potential HR and finance CoEs; b. define the business rules by which a CoE would operate; and c. develop the mechanism by which it would deliver, including staffing. This would include considerations around virtual teams, multi-agency teams, fulltime/part time staff etc. 3.3 The scope of this work does not include support services other than HR and finance. 3.4 All business units are considered to be in scope (xxx). 3.5 The governance structure for the support services solution will be a separate work stream. It will cover the management and reporting of the SSC. It will also cover the controls and issue resolution mechanism for the services rendered from the SSC. Approach 3.6 The steps involved in detailed design are set out below and explained in more detail in this section. Validate scope & project roles Validate scope & project roles Agree tools & methodologies Agree tools & methodologies Detailed design Detailed design Sign off Sign offOrganisation Design Statement of Work Version 7.0 Page 10 of 20 Date Amended: Validate scope and project roles 3.7 The approach to working on the organisation design will be consultative. Involvement will be achieved by the following. 3.7.1 HRDs and FDs providing the lead on key design decisions especially those related to the retained organisations, the role of Corporate and CoE and the interface with the SSC. 3.7.2 Full time SSC design leads (organisation design SME, and 2 service delivery SMEs for finance and HR) and the SSC Director for the SSC structure details. 3.7.3 Point contacts in every business unit for the retained structures (unless the HRDs and FDs decide not to delegate this role at all). 3.7.4 Cross-business unit workshops and forums to agree common designs and role definitions. 3.7.5 Design authority role in place to govern and sign off final designs. 3.7.6 The team structure and roles have been defined in detail in Section 8 of this document. d. The details of the scope of organisation design as defined in Section 4 have been validated and agreed. The project conducted two kick off workshops -with the HR and finance directors of all business units -held in the middle of Month, 200X. The output of this workshop was to agree the scope and high level approach as documented here. Agree tools and methodologies 3.8 It will be critical to agree upfront the methodologies, tools, templates, approach in terms of meetings, workshops etc, to do the detailed design. This would mean extensive involvement from the respective individuals identified for various roles on this project. This is expected to be completed before the end of Month, 200X. 3.9 This stage will cover the following: 3.9.1 Understanding of best practice with regard to SSC structures, roles, service delivery management (including pricing model), retained structures and roles, corporate and CoE structures. Organisation Design Statement of Work Version 7.0 Page 11 of 20 Date Amended: 3.9.2 Agree the methodology for the SSC design: there are multiple ways of structuring a SSC. However, it will be critical to define the vision and objectives for the centre, the design principles for structuring it and use that framework to drive the structure. Xxx’s organisation design methodology has been used successfully to determine similar structures. An overview of the methodology is provided as Annex 1. It also involves determining the query resolution and escalation structure. 3.9.3 Agree the methodology for developing the competency model and using the same for assessing the gap between the as-is and to-be capability requirement through individual-job matching. The gap between existing and desired capabilities would provide the basis for recruitment/redundancies. 3.9.4 Agree the methodology for defining the service delivery framework which covers determining the critical success factors for each process, the process measures or KPIs, target levels and the baseline service levels. 3.9.5 Agree the methodology for determining the pricing model. 3.9.6 Determine the best practice models for professionalizing the retained structures and the methodology to be adopted for facilitating the development of those structures. The as-is structures will be a key input to provide the baseline for developing the structures further. 3.9.7 Agree the process for establishing the detailed FTE requirements. In the last phase, benchmarks were used to provide estimates of reductions. In the detailed design phase, the changes in process design and the process volumetrics will drive the FTE numbers. This activity will take input from the process design teams. 3.9.8 Agree the process for determining the formation of CoEs and the role of Corporate. 3.9.9 Agree the tools and templates to be used at every stage of design. For example: role definition templates, information gathering templates for retained structures etc. 3.9.10 Agree the sign off process at key milestones. Organisation Design Statement of Work Version 7.0 Page 12 of 20 Date Amended: Detailed design 3.10 Preparation for detailed design will commence in Month, 200X. The project team will work with SMEs to agree the templates and approach to be used, as described in the earlier section. 3.11 SSC 3.11.1 The detailed design will cover all the aspects mentioned in the Scope section, using the agreed tools and methodologies. 3.11.2 The SSC Director (as and when on board, or a representative thereof) will be the key owner of the SSC organisation design. 3.11.3 The key deliverables from this phase will be the SSC organisation structure, the service delivery framework (including KPIs and SLAs) and the pricing model. The key activities for these will include the following. a. Designing the SSC organisation structure. b. Defining the service model which will include: i. defining the SSC scope of services; ii. defining the internal performance measures/KPIs by process; iii. measuring current performance (baseline), where possible; iv. agreeing the service levels; v. agreeing the SLA (formal document); and vi. defining the change/review process. c. Agree the principles and mechanism for charging. 3.12 Retained organisations Organisation Design Statement of Work Version 7.0 Page 13 of 20 Date Amended: 3.12.1 We understand that most of the business units have already begun restructuring their HR and finance functions. We envisage that the HRDs and FDs may require different degrees of input towards this. 3.12.2 We shall identify BU wise requirements and facilitate the process of developing the retained structures as needed. 3.12.3 Establishing detailed FTE requirements will be a key activity and the process redesign work along with process volumetrics will form the key criteria for determining these. 3.12.4 The retained organisation design includes the identification and definition of the change in the existing roles of line managers and HR and finance function staff. This phase should help define these changes. 3.12.5 We envisage that the HRDs and FDs may want to directly manage this design. However, they may want to identify a key point contact for managing the details of this process. This will need to be finalised before the end of Month, 200X. 3.13 CoE and Corporate 3.13.1 The process design workshops (as per HR and finance process work plans) will be used to define the role of CoEs and Corporate as a result of the process splits. 3.14 Towards the end of the design phase an important task will be to integrate the various components of the support services organisation design by defining the type, nature and frequency of interfaces and interdependencies. Sign off 3.15 The sign off process will be co-ordinated by the Design Authority. Details about the Design Authority are provided in the Overview Note. 3.16 The signoff authority for the key organisation design deliverables are identified below. 3.16.1 SSC organisation design: SSC Director (or representative). 3.16.2 Service delivery framework, including pricing model: Management Board. Organisation Design Statement of Work Version 7.0 Page 14 of 20 Date Amended: 3.16.3 Corporate and CoE roles: Design Authority. 3.16.4 Retained organisations: Respective HRDs or FDs. 4. Assumptions 4.1 There are a number of assumptions that need to be made for the successful completion of the organisation design. These have been identified in the Overview document. 4.2 In addition, there is an assumption specific to the OD work stream that the HRDs and FDs will take the lead responsibility for the retained organisation structures. The project team will provide best practice input and facilitate and assist as required by the HRDs and FDs. 5. Constraints & risks Risk Description Mitigating Actions Business units not agreeing on a common role definition for the Corporate and CoE roles will impact the standardisation of process split and will constrain the ability of the support services organisation design to deliver. Identify the key concerns upfront and arrive at a common definition. This will need to be done early on in the design phase so that the process work can continue as per plan. SSC director not being appointed at the beginning of Phase 4 – this will impact the time table on the SSC design work. Appoint the SSC Director or a representative (with decision making authority) in the first 2 weeks of the project. A key input into the organisation design work will be the deliverables of the HR and finance process work streams. Any delay on that front will impact this piece of work. Ensuring the interdependencies with the HR and finance work streams are identified clearly and then ensuring that the scheduled work goes as per the timelines identified in the work plan. Lack of involvement in designing the retained structures as impacted by the new support services delivery model would result in the business units not being fully prepared for the implementation. Identifying a SME for the retained structures so that it gets the required attention as the process design work continues. Disagreement on the charging mechanism and the SLAs could delay the implementation of the project. The project will specify the Design Authority role and the conditions under which the issue needs to be escalated further up. Organisation Design Statement of Work Version 7.0 Page 15 of 20 Date Amended: 6. Project structure and roles 6.1 The project structure is detailed below, outlining the roles required to support the organisation design work stream. 6.2 For design of retained organisations: It is envisaged that the HRDs and FDs will take the lead on this. However, they could delegate the detailed work to nominated SMEs (who could potentially be the same as the process design SMEs, if they have the required knowledge and skills) and themselves lead the decision making. 6.3 For the SSC design it is envisaged that the SSC Director (or representative) would take the lead. However, given the scope, there is a requirement for an organisation design (OD) SME to get involved in detailed design. Further, it is essential to have 2 SMEs for developing the service delivery framework – one each for HR and finance. Resource Number required Role profile and knowledge required Level of input OD lead One Will lead the organisation design work stream, taking ownership for the SSC and retained organisation design. Experience of organisation design and SSC structures would be useful. Further, the ability to challenge points of view and evaluate decisions against best practice would be required. Full time Retained organisation design lead -Finance One per BU Will be the key point contact for the retained organisation design. Will be responsible for identifying gaps with the best practice model and flagging those to the FD. Also responsible for identifying and documenting any changes in roles. Experience of organisation design and defining role profiles would be useful. Part time Retained organisation design lead – HR One per BU Will be the key point contact for the retained organisation design. Will be responsible for identifying gaps with the best practice model and flagging those to the HRD. Also responsible for identifying and documenting any changes in roles. Experience of organisation design and defining role profiles would be useful. Part time Project Management Project Manager Organisation Design OD Lead SSC • SSC Director • OD SME • Finance Service Delivery SME • HR Service Delivery SME Retained organisations For each BU: • 1 Finance OD SME • 1 HR OD SME Finance Directors HR Directors Organisation Design Statement of Work Version 7.0 Page 16 of 20 Date Amended: SSC OD lead One Will lead the organisation design for the SSC including role definition and staffing. Experience of organisation design and SSC structures would be useful. Further, the ability to challenge points of view and evaluate decisions against best practice would be required. Full time Service delivery framework lead One for Finance and one for HR Will lead the definition of the service delivery framework for the SSC including the service model, the KPIs, SLAs and charging mechanism. An understanding of functional processes is critical and experience/knowledge of service delivery frameworks is desirable. Full time 7. Work stream plan and milestones 7.1 Attached as Annex 2 is an MS project plan detailing the steps required and by when to achieve the objectives of this stream of work within the agreed timescales. In summary, the key milestones are: 8. Deliverables e. The deliverables from this work-stream represent the blueprint that will be used during the implementation phase. A summary of the deliverables, together with a statement of purpose, is included below. Once the deliverables have been agreed, along with the project plan and milestones, a detailed deliverable description will be produced. Organisation Design Statement of Work Version 7.0 Page 17 of 20 Date Amended: Deliverable Description Purpose SSC organisation structure This includes: -SSC organisation chart to the lowest level, with reporting relationships -Grade wise spans of control -Role definitions and skill requirements -Competency framework -Staffing requirements including FTE numbers -Individual-job matching leading to capability assessment & gap identification which will feed into the recruitment/redundancy requirement -Interfaces & interdependencies with the other components of the design including customer relationship management The organisation design, when integrated with processes and technology, will be the delivery model that will be implemented in the next phase. The competency framework and capability gap assessment will form the basis for staffing and recruitment. Service delivery framework This includes: -Process KPIs (developed by the process workstreams) -Target levels for the KPIs -SLAs -by process by business unit -Change/review process -Pricing model and charging mechanism This will provide the performance management framework for the SSC. It will also define the basis for charging the business units for various services. Structure of retained organisations -Facilitate any stated need around best practice input and/or revised role definitions -Establish detailed FTE requirements based on process redesign This will provide the structure for the retained organisations to operate optimally in the changed environment, with FTE details. CoE design For both finance and HR this will include: -Identified CoEs -CoE role, composition and staffing This will clarify the role of the CoEs and the manner in which the business units can leverage the CoEs. Corporate role design This includes the definition of both: -Xxx (c)’s role as Corporate; and -The role of HRD and FD forums This will determine the role that Corporate plays in delivering support services. 8.1 The organisation design workstream will need the following key input from the process design teams: 8.1.1 CSFs and KPIs for the HR and finance processes; and 8.2.2 CoE and Corporate role definitions from the process workshops. Organisation Design Statement of Work Version 7.0 Page 18 of 20 Date Amended: 2. Illustration of key deliverables SSC organisation structure options 8.2 Organisation structure options will be presented with key advantages and disadvantages. The query resolution and escalation process for each option will be described. This should enable the decision making towards the most optimal option. 8.3 Below is an example of a possible option (high level design). 8.4 Below is an example of a query resolution process. Tier 0 Self-Service • Predefined answers • Basic to complex enquiries • Transaction processing Tier 1 Customer Support Representative (SSC) Tier 3 BP/CoE Tier 2 Process teams (SSC) CoE /BPs SSC Employee or Manager Through self-service (and existing intranets): Pre-defined answers on the Intranet and transaction processing • ESS: Basic enquiries, access to policies and procedures (e.g. absence policy) and forms for employees to complete routine transactions (e.g. vacation request form), basic changes to personal data (e.g. address change) and query requests can be initiated • MSS: initiating and/or conducting processes (e.g. vacancy authorisation, appraisal process initiation, personal development planning, absence reporting) First line of support to managers and employees • Queries and service requests raised through phone, email, web portal, mail and fax • Call-routing ensures contact centre assistant has appropriate skills, based on query • Results in: query resolved, query escalated to tier 2 Specialist support to resolve complex and /or strategic issues escalated from the SSC. Queries routed to the relevant BP if the issue is BU specific (e.g. employee relations). Queries routed to the relevant CoE team if query is policy-specific Second line of support to managers and employees • Tasks routed from tier 1 queries and allocated based on area of specialism (e.g. recruitment, accounts payable) • Results in; query resolved, query escalated to tier 3 or administrative transaction executed by specialist services team ESS /MSS Organisation Design Statement of Work Version 7.0 Page 19 of 20 Date Amended: Role descriptions 8.5 Below is an illustration of a role description. Shared Service Center, Finance and Administration JOB TITLE Xxx ROLE SUMMARY xxx REPORTING TO [To be specified] LOCATION [To be specified] QUALIFICATIONS, SKILLS AND ATTRIBUTES · Xxxx RESPONSIBILITIES · xxxx PERFORMANCE STANDARDS · xxx Terminology 8.6 It has been noted during meetings with business units that there is inconsistency in terminology used within the Xxx by different business units. Coupled with the terminology used by the SSP and that used by SAP there is a very real risk that something may be signed off that was not meant. There will therefore be a glossary of terminology to accompany the outputs. 9. Next steps 9.1 The next step is to sign off the statements of work and hand over to the appropriate teams for phase 4. Organisation Design Statement of Work Version 7.0 Page 20 of 20 Date Amended: Annex 1: Overview of the Xxx Organisation Design methodology Translate strategy Conduct research (market landscape) Understand current state (business landscape) Complete impact assessment Identify initial organisation design opportunities Context and direction Develop initial recommendations Feasibility Analysis (politics, cost, benefits, effort, capability, timescales) Develop primary and supporting hypotheses Test and validate primary and supporting hypotheses Develop organisation design Complete implementation plans Sub-stream 1 Sub-streams 2…n Complete organisation design Business Integration Management Project Management Commit Point Commit Point Commit Point Deliverables; 1. Strategy Articulation 2. Market Landscape Analysis, including Best Practice report 3. Current state, including Value Chain Analysis and RACI Deliverables; 1. Initial Organisation Design opportunities, including Business Case and Impact Assessment 2. Quick wins, including rationale Deliverables; 1. Organisation Design Recommendations, including Job Descriptions 2. Component Implementation Plans (by sub-stream) 3. Integrated Plan, including Change Architecture 4. Executive Summary Segment Theme (containing techniques) Core Work Package • Develop strategy map • Develop 6-ball model • Understand IT strategy • Conduct market research • Conduct industry research (including crossinduustry • Complete best practice research • Complete value chain analysis • Understand current structure/scope • Identify roles and dependencies • Understand processes and systems • Identify suitable design options • Define initial hypotheses/design principles • Identify quick wins • Assess impact on structure • Assess impact on scope • Assess impact on roles • Assess impact on dependencies • Develop primary hypotheses • Develop supporting hypotheses • Define rationale for acceptance of hypotheses • Complete quantitative and qualitative analysis • Conduct client meetings and workshops for validation purposes • Define scope and structure for organisation/department • Define roles and dependencies to support structure • Develop job descriptions • Define key implementation activities • Identify issues and risks (including mitigations) • Develop detailed project plans Clearly define and validate scope and objectives for next segment – Document as required. Agree and prioritise opportunities, including detailed rationale for decisions – Document as required. Obtain agreement and commitment to implement recommendations. Project Initiation