The Shared Services Market is poised for significant growth, driven by a rising demand for cost optimization. Shared services aim to consolidate various business functions within an organization, resulting in reduced duplicative costs and enhanced economies of scale. Commonly shared services encompass finance and accounting, human resources, procurement, and information technology. Industries such as banking, insurance, retail, and manufacturing widely adopt shared services models to reduce operational costs and improve efficiencies.
As per a recent report from Coherent Market Insights, the global shared services market is projected to reach a valuation of US$ 162.48 Mn in 2023, with an anticipated Compound Annual Growth Rate (CAGR) of 8.3% from 2023 to 2030.
Market Dynamics:
The key driver propelling the growth of the shared services market is the increasing demand for cost optimization. Organizations leverage shared services to lower operational expenses by eliminating redundancies and duplications across different business functions, enabling more effective resource utilization. The complexity of business operations is pushing companies towards shared services arrangements to streamline processes, integrate disparate systems, and enhance competitiveness. Standardization of common processes through shared services also facilitates better compliance management. The market is expected to gain further traction due to the growing need for enhanced productivity and focus on core business operations among enterprises.
SWOT Analysis:
Strengths:
Significant cost savings benefits through streamlined business processes and resource consolidation.
Allows companies to focus on core competencies by outsourcing non-core functions to specialized shared services providers.
Standardized processes across business units improve process quality and compliance.
Weaknesses:
Transitioning to a shared services model requires high upfront investments and organizational process restructuring.
Resistance from internal stakeholders due to changes in reporting structures and potential job losses.
Data security and privacy concerns arise while outsourcing critical functions to third-party providers.
Opportunities:
Growing adoption of cloud-based technologies provides an opportunity for automated shared services, improving efficiency, scalability, and reducing costs.
Demand for outsourcing functions from SMEs, such as finance & accounting, human resource management, and procurement.
Threats:
Dependency on third-party providers increases risks related to service disruption due to factors like regulatory changes, mergers & acquisitions, or provider bankruptcy.
Rising costs of services may impact expected savings from shared services centers.
Intense competition from global players exerts pricing pressures.
Key Takeaways:
The Global Shared Services Market Share Size is expected to experience substantial growth driven by the imperative for cost optimization. The market size for 2024 is estimated at US$ 162.48 Mn, registering a CAGR of 8.3% from 2023 to 2030.
Regional Analysis:
North America currently dominates the shared services market, with a share of over 35%, driven by early adoption among organizations in the US and Canada.
Asia Pacific is expected to witness the fastest growth, led by countries like China, India, and other Southeast Asian nations serving as outsourcing destinations for global companies.
Key players in the region include Dell Inc., Zebra Technologies Corp., and Panasonic Corporation, focusing on expanding cloud-based offerings.
Key Players:
Key players operating in the shared services market include Dell Inc., Curtiss-Wright Corp., Getac Technology Corp., General Dynamics Corp., Zebra Technologies Corp., L3 Technologies Inc., Panasonic Corporation, Scio Teq, Sparton Corp., Crystal Group Inc., Kyocera Corp., and Beijer Electronics Group AB.
These players are focused on developing digitally-enabled solutions for finance & accounting, supply chain, and human resource functions to drive efficiencies.
For more details on the report, Read- https://www.dailyprbulletin.com/shared-services-market-market-size-and-share-analysis/
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