In the United States and Europe alone, more than 25 million people work in support functions—HR, IT, finance, customer call centers—in companies across a diverse array of industries. The administrative expenses associated with what are also often called shared services exceed $2.5 trillion, according to BCG analysis.
Imagine what these organizations could do if they not only cut the administrative expenses for these functions roughly in half but also:
Administrative expenses associated with support functions exceed $2.5 trillion
Improved productivity could save more than $1 trillion
Support functions in the US and EU are staffed by 25 million people
Savvy use of digital tools and technologies—such as robotic process automation (RPA) and artificial intelligence (AI)—can help companies turbocharge the performance of their support functions. How? Digital transforms these functions from merely transactional service factories into service-solution providers and strategic partners that unleash new value throughout the organization.
Armed with digital tools, employees in these functions can draw on the right data—from multiple sources, in real time—to swiftly deliver services tailored to the needs of their internal customers, at every step in the customer journey. That kind of service frees customers—employees, managers, and executives—to devote the lion’s share of their time and energy to activities that create the most value.
When people can focus on value-adding activities such as formulating effective strategies, designing successful marketing campaigns, analyzing the competitive landscape, and crafting smart business plans, they and their entire organization win.
BCG takes a holistic approach aimed at achieving and sustaining positive change for our clients by:
BCG is helping large, complex global organizations complete ambitious digital transformations of their support functions and shared service organizations, across all industries, including automotive, pharmaceutical, consumer goods, industrial goods, mining, and IT. Thanks to our holistic approach, we have built an extensive track record of success with our clients. Examples of results include 30-75% reductions in FTEs and 40% targeted cost reductions.
New technologies are changing how support functions work—and rendering some of them entirely obsolete. To capitalize, companies need to reorganize those functions from the ground up.
Using a three-part approach, companies can redesign processes and choose the right tools to unlock the real value of digital technology in support functions.
Though digitization offers clear benefits, only one in five companies has the right foundation in place to implement it. The rest should follow seven best practices to close the gap—starting today.
Transformative technologies for back-office processes don’t automatically deliver the promised payoff. To succeed, companies need a thoughtful, end-to-end plan.
By using digital technologies such as automation and artificial intelligence (AI) to improve the productivity of their support functions through BCG's three-point approach, professional services firms can achieve cost savings of 30% to 40% and accelerate their commercial engine.
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Digital technologies are transforming every aspect of business—and no turnkey solution will equip you to keep pace. DigitalBCG engagements are designed to deliver immediate value, while also building the capabilities, processes, and mindsets necessary to sustain your digital transformation.
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