A Knowledge Management Perspective to Shared Service Centers: A Case Study of a Finance SSC

Abstract Purpose The chapter presents case evidence to argue that rather than comprising noncore, back-office business support services, shared service centers (SSCs), when viewed from a knowledge management perspective, can create both valuable and firm-specific resources and dynamic capabilities. Design/methodology/approach Literatures in strategic management, knowledge management, and business process sourcing are drawn on as a prelude to a longitudinal case study conducted by the authors in a large private sector utility company. Findings A knowledge management perspective demonstrates how the SSCs, as a hybrid organizational form, may help to redefine core versus noncore activities and thus, to play a role in the creation and protection of firm-specific resource and dynamic capabilities. Research limitations/implications The SSC model is an emerging phenomenon and the field work is restricted to a single case study. Further field research is suggested. Practical implications The findings should be useful to those organizations embarking on the reconfiguration of back-office support services which might gain from further consideration of what activities might be seen as constituting core enterprise architecture. The case study demonstrates that when the traditional core activities of the organization become commoditized over time, a core competence becomes the management and administration of a bundle of technical projects premised on the processes and information systems of the SSC. Originality/value Shared services is an emerging phenomena and scholar literature is nascent. The chapter explores potential benefits of the SSC model beyond the headline agenda of cost reduction through efficiency savings and labor arbitrage.