TOPIC: Shared Services
OFFICE: Division of Administration
QUESTION / ISSUE:
STATE: OH
DATE: 01/18/2011
I am interested if other states are thinking about shared services, how far they are in bringing shared services to
fruition, and the focus of their shared service (financials, human resources, IT, etc.).
I am working in Ohio Shared Services (OSS) a new division of the state of Ohio’s Office of Budget and
Management. In September 2009, we began processing vendor invoices for several state agencies and in
October 2009, we began processing travel reimbursements for all state agencies, boards and commissions.
Currently, Ohio, our focus is on financial transactions and OSS is responsible for:
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Maintaining the central vendor database (for vendors doing business with the state of Ohio)
Reviewing and approving travel reimbursements statewide
Paying selected vendor invoices for 8 state agencies
We are well equipped with a state of the art Contact Center and we offer scanning/imaging services for
customers, as well. More information about Ohio Shared Services is available on our website:
www.ohiosharedservices.ohio.gov.
This month, Ohioans elected a new governor and, along with that, new directors of agencies. I am trying to
gather information for the new Director of the Office of Budget and Management about what other states may be
doing with shared services. I am aware that Massachusetts, Oklahoma and New York have discussed the
possibility of shared services for finance. And, I understand Pennsylvania has a shared services center for
human resources. I would appreciate it if you could share with me what your state is doing with regard to
shared services.
We are defining shared services as a metrics driven organization with a focus on customer service and some
type of service level agreement. I think those are the components that differentiate shared services from
centralized services.
Ohio has a statewide accounting and payroll systems, too. Our Ohio Shared Services focuses on processing
selected vendor invoices for 8 agencies. We’re a pilot project so it’s a voluntary option right now. Ohio has a
central service agency to assist 36 boards and commissions with HR and FIN functions (including general
accounting & budget support).
Colorado
Colorado has taken no steps toward centralized shared services statewide. Individual
departments have centralized some accounting functions within their departments, but not to
any significant extent.
Mississippi
We are also looking at shared services in Mississippi. Several SS bills have been introduced
by our legislature this session.
North Carolina
We pay approximately 100,000 employees through bi-weekly and monthly payroll cycles.
Part of my group, managed by Herb Henderson, is a shared services center.
The Shared Services Center was developed as a support organization for agency human
resources, benefit, time and payroll core users and employees and managers utilizing
Employee Self Service (ESS) and Manager Self Service (MSS). Staffing is divided into four
areas: Call Center, Human Resources (OM & PA), Benefits and Payroll/Time.
The group is responsible for the following:
 Answer questions from agencies/employees relative to employee records, pay
statements, benefit information and payroll administration and organizational
management transactions.
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Oregon
Provide assistance and support to HR core users with organizational management
and personnel administration transactions.
Coordinate activities associated with enrollment for statewide benefit plans (i.e., State
Health Plan, NC FLEX, retirement and vendor payments).
Process payroll for approximately 100,000 employees (includes bi-weekly and
monthly cycles).
Provide support for agency reports.
Serve as the primary point of contact for our HR/Payroll ERP issues.
We have a statewide accounting and a statewide payroll system, but each require staff in the
agencies to run their own business processes.
We have a staff of 5 or 6 that contract with small agencies to provide general accounting and
budgeting support services to about 28 or so small agencies.
But other than that, no other “shared services.”
Utah
Utah's Department of Administrative Services has been very interested in the Ohio Shared
Services organization; we even had a conference call or two and a training session with
Ohio's consultants about the Ohio project in 2010. Most of our discussions thus far have
been centered on shared services within our own department. However, we are currently
looking at technology solutions that we could put in place that would enable us to offer
central processing of invoices and travel, similar to Ohio. Our vendor database has been
centralized for years.
Utah has a consolidated Human Resources Department that is currently putting together a
Customer Services Center. They are calling it a shared services center. Their goal is to
have employees call the center to get basic services or questions answered vs. contacting
their HR field representative directly. It will be operational on or before July 1, 2011.
Within our own department (not statewide) we are also looking at "shared services" for
marketing and communications and performance management, along with financial
transaction processing.
Virginia
The Commonwealth of Virginia has been running a shared service center for
payroll/benefits/leave processing within my office since 1996. It has grown now to serving
over 16,000 employees and 55 agencies. COV operates other shared service operations
within smaller consortiums of agencies including the Corrections, Transportation and Rehab
Services. Legislation is pending that will mandate shared services for all agencies. To
expedite implementation, this may also entail establishing additional payroll service centers
among other agency consortiums such as Mental Health, community colleges and even
universities (i.e., we don’t necessarily intend to bring all processing into one center).
COV has also operated a shared service center for human resources, which is run by our
Department of Human Resources.
COV also has a few fiscal shared service arrangements between agencies, but nothing
extensive yet. We plan to look for opportunities to provide shared services for certain fiscal
functions in relation to our implementation of a new financial system.
Additional questions for Virginia
1. What services does the HR shared service operation offer to agencies?
To clarify, there are two separate shared service centers; one for payroll and one for
HR. Payroll services are covered by
http://www.doa.virginia.gov/Payroll_Service_Bureau/BusinessProcessOverview.pdf .
HR services are outlined in the below Word document.
2011 Scope of
Services.doc
2. Is it mandatory for agencies to use the HR shared services operation?
HR, no. PR, mandatory legislation is pending. The mandatory PR legislation stemmed
from the Governor’s Reform Commission, which contains other recommendations
regarding shared services that will also ultimately result in legislation mandating further
consolidation in other administrative areas.
3. Does the pending legislation target HR only or is there a push to look at shared
services for FIN and/or IT?
Pending legislation targets only PR, however, we have other Reform Commission
recommendations that target other administrative areas including FIN and HR (see
shared services section http://www.reform.virginia.gov/docs/12-0110_GovernorsCommissionReport.pdf). Additionally, a planned new financial
management system implementation will likely add urgency to shared services for FIN.
IT infrastructure consolidation took place in Virginia about 8 years ago.
Washington
Washington has several shared service initiatives underway. They include:
For IT services –
 Email
 Servers
 Desktop support and virtual desktop
 Storage
 Small agency IT support
 We are also completing the build out of a single data center and will migrate
all state data centers into one over the next 4 years.
Motor pool – Department of General administration. Started with smaller individual
pools and have been consolidating over the past year. Central motor pool has a fleet
of 5,000 vehicles we have 10 or 12 other fleets of 500 to 2,000 vehicles yet to
consolidate.
Financial Services – Agencies with less than 175 FTE through a central provider. 45
agencies currently served.
HR – There is a small agency HR service provider in the Department of Personnel.
They current serve 35 agencies and are expanding.
The Governor has proposed some agency re-org’s this session. One consolidates central
service agencies into one agency Department of Enterprise Services. Here’s a link:
http://www.governor.wa.gov/priorities/budget/consolidate_services.pdf