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A Closer Look at Shared Services

Shared services can be a powerful tool in ensuring optimal function, full transparency and efficiency. But shared services can allow better communication, increased staff capacity, operational efficiencies and an enhanced sense of team and community throughout.

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Shared services can be a powerful tool in ensuring optimal function, full transparency and efficiency. But shared services can allow better communication, increased staff capacity, operational efficiencies and an enhanced sense of team and community throughout.

Traditionally, our municipalities have been known to be a bit territorial when it comes to managing operations.  There has always been the “Town side” and the “School District side,” and different ways of doing things for each.

For example, there is both town staff and school staff, dissimilar software systems and sometimes conflicting personalities at play.  And the single biggest difference we hear is a difference in missions; the Town’s being “to save taxpayer dollars” and the School District’s “to educate our children.”  But at the end of the day, we are talking about one community, one constituency and one group of citizens that is mostly interested in living in, and being a part of, the best municipality possible.

Fear over a loss of control is common among municipalities, and is often the reason they hesitate in embracing shared services. But there is a way to cooperate and share without losing autonomy and without sacrificing the strategic mission of either entity. And not only is there a way to collaborate in a meaningful way in which neither entity “loses,” there are ways in which all parties can “win.”

Here’s how to explore the possibilities without fear:

Step 1: Review current processes and operations

Document the core processes and “back office” functions that both entities complete regularly. Think payroll processing, HR functions, purchasing, IT, facilities maintenance etc.  Both the School District and Town need to pay their employees, both need IT services, and both need clean, functioning space in which to work.  Start by figuring out how each entity manages these areas and see if there are significant similarities or differences.  Maybe one department has been doing it better all along and the other entity could benefit from changing up their old ways and adopting a similar approach.

Step 2: Evaluate current staff positions and organizational structures

Assess both entities for how they are structured, who the employees are and where strengths and weaknesses exist.  Does one entity have a “deeper bench” than the other?  Is one extremely short or under-staffed?  Are skill sets similar? This is where shared services can benefit all.  Cross-training employees helps ensure that when emergencies or staff outages happen, business can continue.  In this step, assessing union contracts, pay grades and benefits are all critical components to iron out before moving forward.  Any significant discrepancies will need to be addressed.

Step 3: Confirm current technologies

What tools and systems are used to process purchase orders, run payroll, and manage employees and day-to-day finances?  If the Town and School District share any of the same platforms, all the more reason to consider collaboration.  In other areas, one entity may have an automated tool that completes the task in half the time with half the effort (e.g., automated purchase orders and the use of mobile app approvals vs. the circulation of paper purchase orders and manual sign-offs).  Identifying similarities and differences in the tools used for daily operations will help your municipality determine if both entities can adopt one system in particular to better operate, or if the optimal way to function is a hybrid of both/multiple systems and methods.

Step 4: Develop potential frameworks and structure scenarios

Get the management teams from both sides together, or utilize a neutral third-party consultant to help draw up what some of the new organizational structures and business units may look like.  Could you centralize the payroll department?  Will you consolidate and combine IT staff?  This is where you can explore all options for running the municipality.  It doesn’t mean you need to implement them all at once, but they are worth documenting and considering; the timelines for rollouts can be worked out later.

Step 5: Develop the plan

Once there’s a general agreement to move forward between the parties, an action plan outlining all of the work that needs to be done in order to establish shared services is needed.  The action plan should denote project teams, work steps, deliverables, project budgets, and timelines.  It is important to break the process of combining departments into manageable tasks.  Starting with smaller, easier consolidations and getting a few early wins is never a bad approach.

As part of the shared services rollout, the municipality will need to develop and document an agreement between both parties.  A contract that captures the details and spirit of the agreement should be drafted.  The best contracts are the ones that reflect the agreement, but never need to be referenced because all concerned parties work cooperatively to deliver what they promised.

Shared services can be a powerful tool in ensuring optimal function, full transparency and efficiency.  Students can still receive the best education possible while keeping taxes down, one party does not have to “control” the other in terms of budget and/or financial decisions, and autonomy can be retained in certain areas.  But shared services can allow better communication, increased staff capacity, operational efficiencies and an enhanced sense of team and community throughout.

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