Shared and Outsourcing Services

As a business grows bigger, there is a need for internal operations to expand, which costs more money and resources.

The evolving labour market and advance in technologies have a profound impact on the way businesses work. Outsourcing business operations to another company or individual as well as setting up Shared Service Centres (SSCs) are now the norm to reduce costs and streamline business operations.

At NLA DFK, our team of shared and outsourcing services experts are well-trained in shared and outsourcing services, with extensive experience across multiple industries and countries.

Our Services

Our highly trained and experienced consultants can provide the following shared and outsourcing services in Singapore to corporate clients:

  • Outsource business operations to another company or individual
  • Set up Shared Service Centres (SSCs)
  • Apply for government grants and investment schemes
  • Expand business operations
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Frequently Asked Questions About Shared and Outsourcing Services in Singapore

1. What are shared and outsourcing services?

Shared services typically involve setting up Shared Service Centres (SSCs). Run by the company’s employees, an SSC consolidates the company’s non-core support services – finance and accounting, human resources, and IT – and delivers them from centralised locations.

Outsourced services are conducted by another external company which is not related to the company at all. 

2. What are the differences between shared services, outsourced services, and offshore services?

Shared services VS outsourced services: Shared services are still run by the company’s employees, albeit from a centralised location like a Shared Service Centre. Meanwhile, outsourced services are conducted by external companies or individuals.

Shared services VS offshore services: As previously explained, shared services involves setting up Shared Service Centres (SSCs), which consolidates the company’s non-core support services and delivers them from centralised locations.

Offshore services involve setting up operations in a location from another country that isn’t Singapore. Common countries include India and the Philippines. 

It is also possible for a company to have both shared services and offshore services, which are known as shared offshore services. SSCs run by the company’s employees will be set up in overseas locations like India and the Philippines to support the company’s non-core services.  

Outsourced services VS offshore services: Outsourced services are managed by another company or individual that is not related to the company that is hiring them.

Offshore services involves setting up operations in a location that isn’t Singapore. It is also possible for a company to have both outsourced services and offshore services, which are known as outsourced offshore services. The company can hire an external company or individual from another country like India and the Philippines to run its business operations.

Even though they have their slight differences, the key similarity between shared services, outsourced services, and offshore services is mainly for the company to reduce costs and streamline business operations.

3. What are the benefits of shared and outsourcing services?

Streamline business operations: Sharing and outsourcing services takes the pressure off the employees, allowing them to focus more on core services and value-added areas. It enables the entire company to become more productive, agile, and flexible, which greatly increases business efficiency. 

Lower costs: Sharing and outsourcing non-core services allow the company to drastically reduce their administrative costs, especially if they outsource their business processes. This is mainly due to the supply of cheaper labour and a wider range of talents.

When issues arise, companies can be assured that the solution will be provided quickly. By sharing and outsourcing services, companies gain the support of a team of specialised experts that can leverage on their experience and instantly tackle problems with a quicker turnaround time. What may take a team hours to fix can be resolved easily in a few minutes by a team of professionals in a Shared Service Centre (SSC) or outsourced company. 

4. Which is better – shared services, outsourced services, or offshore services?

Each type of service has its own pros and cons. It ultimately depends on what the business values. Below are the lists of pros and cons for each type of service.

Shared Services

Pros Cons
  • Cheaper as it reduces operational and labour costs;
  • Good understanding of the company’s processes as SSCs are still part of the main company; and
  • Streamline business operations, allowing the company to focus more on improving other core business functions
  • May not be the cheapest option, compared to offshore services

 

Outsourced Services

Pros Cons
  • Cheaper as it reduces operational and labour costs;
  • Provides more specialised services, with a team of experts that possess the latest skills, use up-to-date technology, and can provide round-the-clock services; and
  • The company can focus more on improving other core business functions
  • May not be the cheapest option, compared to shared services or offshore services; and
  • Employees may have a lesser understanding of the company’s processes, compared to shared services

 

Offshore Services

Pros

 

 Cons
  • Typically the cheapest option amongst the three types of services;
  • Wider pool of talents available for hire;
  • Provides more specialised services, with a team of experts that possess the latest skills, use up-to-date technology, and can provide round-the-clock services; and
  • The company can focus more on improving other core business functions
  • Employees have the least understanding of the company’s processes, compared to shared services or outsourced services
  • Language barrier as the services are based overseas