Shared services are platforms that consolidate common business functions, processes, and transactions across divisions within an organization. Shared services help consolidate overlapping functions such as finance, human resources, procurement, supply chain management into centralized centers of expertise that deliver standardized services to internal customers. Advantages associated with shared services include optimization of cost, standardization of processes, improved expertise, and regulatory compliance. The growing need for optimization of cost across industries is driving the demand for adoption of shared services which eventually aid organizations to focus more resources on their core competencies.

The Global Shared Services Market is estimated to be valued at US$ 187.18 Mn in 2024 and is expected to exhibit a CAGR of 8.3% over the forecast period 2024 To 2031.

Key Takeaways

Key players operating in the shared services market are 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. Shared services enable organizations to optimize costs by leveraging economies of scale and enhancing efficiencies. Growing preference towards outsourcing non-core business functions is driving the adoption of Shared Services Market Size Technological advancements have made it possible to deliver shared services remotely through cloud and automation technologies thereby augmenting their demand.

Market Trends

The emergence of digital shared services is one of the key trends being witnessed in the market. Digital shared services enable organizations to leverage technologies such as cloud, blockchain, artificial intelligence and predictive analytics to enhance the delivery of shared services. This allows real-time sharing of information and provides personalized services to customers. Growing adoption of automation technologies is another major trend in the shared services market. Automation helps improve process efficiencies, enhance productivity and optimize costs for organizations. Technologies such as robotic process automation allow integration of systems and automation of repetitive tasks. This helps free up resources to focus on more strategic tasks.

Market Opportunities

Growing demand from small and medium enterprises presents a major opportunity for players in the shared services market. Smaller organizations are inclined towards outsourcing of non-core functions to optimize costs. Emerging technologies also allow easier implementation of shared services for such organizations. Growing preference of organizations towards outsourcing of finance and accounting activities is another key opportunity. Scalable cloud-based solutions are gaining traction for outsourced finance and accounting services. This is expected to drive the demand during the forecast period.

Impact of COVID-19 on Shared Services Market Growth
The COVID-19 pandemic has significantly impacted the growth of the shared services market. During the initial lockdown phase in 2020, enterprise operations were severely disrupted as work from home became the new norm. This posed several operational challenges for shared service centers and business process outsourcing companies. Remote work adoption accelerated overnight, placing immense pressure on the IT infrastructure of shared service providers. Transitioning to work from home involved upgrading desktop infrastructure, collaboration tools, cybersecurity solutions and redesigning work processes. This led to short term declines in productivity and revenues for shared services players in 2020.

However, as businesses stabilized remote work models over the course of 2020-21, it increased the focus on streamlining and digitizing back office functions. This boosted the demand for multi-location managed infrastructure services offered by shared service providers. The pandemic highlighted the resilience and scalability benefits of centralized shared services models. More companies recognized the need to consolidate back office activities to gain cost efficiencies. This is driving greater adoption of finance and accounting, procurement,HR and IT infrastructure services delivered through the shared services framework. Shared services providers are also investing in advanced automation using AI, RPA and cloud to enhance service delivery and security in the long run.

Geographical Regions with High Shared Services Market Value
North America currently accounts for the largest share of the global shared services market in terms of value. This is due to the strong presence of major shared services providers as well as early adoption by large US-based enterprises. Europe follows next, led by favorable government policies supporting business process outsourcing in countries like Germany, UK and Ireland. The Asia Pacific region is witnessing the fastest growth and is emerged as an attractive outsourcing destination, driven by low-cost shared services centers in India and Philippines serving global clients. China is also growing as an emerging shared services hub, providing finance and HR services mainly catering to domestic enterprises.

Fastest Growing Region for Shared Services Market
The Asia Pacific region holds huge future growth potential for the shared services market. China and India are rapidly emerging as the next generation shared services hubs. Key factors fueling strong demand in APAC include growing multinational company presence, rising wages, and government initiatives promoting business process outsourcing industry. India remains the innovation leader offering advanced digital solutions leveraging artificial intelligence. The China market is expanding at an exponential pace under the government's "Made in China 2025" program focusing on manufacturing and technology upgrades. Low operating costs and availability of skilled workforce make APAC very attractive for global enterprises looking to consolidate back-end operations.


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