Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which of the following is NOT an advantage of shared service organizations?

1. Cost savings

2. Better coordination of operations

3. Enhanced employee training

4. Improved communication with clients

The correct answer is: Enhanced employee training

Shared service organizations offer various benefits, but enhanced employee training is not typically considered one of their primary advantages. The main focus of shared services is to streamline operations, reduce costs, and centralize functions to eliminate redundancies. Cost savings arise from the consolidation of resources and functions, which allows organizations to reduce overhead and achieve economies of scale. Better coordination of operations is achieved as processes become standardized and optimized across different business units, leading to improved efficiency. Enhanced communication with clients can also result from clearer, centralized processes that ensure consistency and quality in client interactions. While employee training may improve in some capacities within shared service settings due to standardized training programs, it is not a universally guaranteed benefit or a primary reason for adopting a shared services model. The training may not always be more effective than what was in place before, especially if the shared service organization is focused more on efficiency and cost reduction than on individual development.