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our shareholders. This saving is likely to grow as more functions are moved into the SSC
hence this will represent a perpetual annuity that should help boost shareholder value.

 Bargaining power: There is also strength in the relatively stronger bargaining power of a
Shared Services Center which can help strengthen our overall supply chain strategy.

 Group treasury and exchange rates risk mitigation: Doing business across Africa can be
complex with so many different currencies and regulations to deal with. Africa is not yet an
integrated economic block as the EU with a common currency and monetary policy. This

requires a very careful thought-through financial risk and treasury management architecture
to navigate the multiple currency convertibility, exchange controls regulations, multilateral
netting and liquidity management challenges. This can be best served if such expertise is

centralised and developed as part of the SSC.
 Better co-ordination and support: Sadimba is our head quarters and its located in one of the
most economically advanced countries on the continent, borne out by many multinationals

choosing to locate their regional head quarters here, making the place a natural choice.
 Quality service provision: A Shared Services Center allows standards and benchmarks to be

set across the group and the center can often compare itself with other SSCs and aim for
continuous improvement allowing better quality and professional support to the businesses.

 Focus on core business: This is the biggest one, we would argue. It allows managers to
focus on growth and customer experience. Appendix 6 again shows a simple average of
37% ( 20 + 30 + 60 / 3) of management time across the business is spent on non core

activities, which is why we rolled out the timetable to bring HR, IT under the SSC.

Disadvantages:
 Loss of jobs: We are being charged with 'off shoring' jobs to Sadimba. 75% of the S$1450
per transaction cost recovery at the SSC includes personnel costs for new jobs most likely

created in Sadimba to compensate for the ones lost in the other countries. It is therefore not
an unfair criticism we face because anytime a company removes key activities it performs in

one country to continue performing them in another by itself (off-shoring) or by another
(outsourcing), it is viewed negatively in the departing country. Many Western companies
have been off-shoring to Asia in search of global cost competitiveness.

 Loss of autonomy: Senior executives in Africa feel their independence has been lost to
centralised group control beyond what is already exerted via the corporate board structures.

 Low staff morale and high staff turnover: The recent employee survey has already confirmed
this challenge. We may soon face a wider market perception that job security is a problem at
MCOM damaging our ability to attract top talents. In Sadimba we may struggle to keep new

recruits motivated with what will now be routine transactional processing and non-interesting

Developed by The CharterQuest Institute for 'The CFO Business Case Study Competition 2016'
www.charterquest.co.za | Email: thecfo@charterquest.co.za