July 19, 2024
Shared Services Market

The Future of Shared Services Market

The Shared Services market is estimated to be valued at US$ 41.37 Bn in 2022 and is expected to exhibit a CAGR of 23.1% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:
Shared services is a consolidation of common business processes and suppport across an organization into a centralized shared services organization. This allows core business units to concentrate on their business goals while centralized departments handle tasks like payroll, human resources, information technology, finance and customer service.

Market Dynamics:
Increasing adoption of cloud-based shared services solutions is expected to propel the market growth over the forecast period. Cloud-based shared services delivers centralized support services virtually through cloud computing. It eliminates the need for upfront capital expenditure on hardware, lowers maintenance costs and offers flexibility and scalability.
Another driver for the market is growing need to reduce operational costs. Shared service organizations aims to achieve economies of scale by consolidating common activities, standardizing processes and leveraging technology which helps in reducing redundancies and optimize resource utilization. This results in lower per-unit costs for delivering services.
Market key trends:
The shared services market is witnessing the trend of increased adoption of technological advancements. Enterprises are increasingly investing in digitization and automation technologies like artificial intelligence, machine learning, robotics process automation etc. to improve the efficiency of their shared services functions. These technologies help in streamlining business processes, reducing operational costs, optimizing resource utilization and enhancing customer experiences.

SWOT Analysis:
Strengths: Consolidation of back office functions leads to cost savings and operational efficiencies. Improve coordination across business functions.
Weaknesses: High initial setup and implementation costs. Risk of overcentralization if not implemented properly.
Opportunities: Opportunity to tap new markets and revenue streams by leveraging core competencies. Growing demand for outsourcing of non-core functions provides growth opportunities.
Threats: Intense competition. Disruption from emerging technologies like blockchain.

Key Takeaways:
The global Shared Services Market Segmentation is expected to witness high growth, exhibiting CAGR of 23.1% over the forecast period, due to increasing need for cost optimization and focus on core business activities.

Regional analysis: North America dominated the market in 2023 with a share of over 30%, due to presence of major shared services providers in the US. Asia Pacific is expected to witness fastest growth due to availability of low cost talent and growing adoption among companies to optimize costs.

Market size: The global shared services market size was valued at US$ 41.37 Bn in 2023. Factors such as rising outsourcing of finance & accounting, HR and procurement functions will drive the market expansion during the forecast period.

Key players: Key players operating in the shared services market are Infosys Limited, SAP, HCL, EXL, Atos SE, Accenture, Genpact, IBM Corporation, Oracle Corporation, Cognizant, Capgemini SE, and Tata Consultancy Services Limited and Others. These players are focusing on new service offerings and partnerships to expand their geographic footprint.