Captive Shared Services vs. Outsourcing: Finding the Model That Drives Transformation 

One of the most foundational decisions a leader makes when transforming their back-office operations is choosing the right shared services delivery model. The long-standing debate between building a captive shared services center (SSC) and leveraging a third-party outsourcing partner has only intensified as new technologies and global business pressures reshape the landscape. 

Historically, the decision was often viewed as a simple trade-off between control and cost. Today, however, that choice has evolved. The rise of intelligent automation, the intense competition for talent, and the need for greater business agility have introduced new variables that demand a more sophisticated evaluation. 

Today, the question isn’t which model best optimizes a function. It’s about the model that drives enterprise-wide transformation and creates long-term competitive advantage. 

Captive shared services vs. outsourcing: What to consider before deciding 

Choosing between a captive SSC and an outsourced model requires a careful evaluation of your organization’s unique priorities, capabilities, and long-term strategic goals. Below, we break down the key factors that leaders must consider to make an informed decision. 

Control vs. expertise 

A captive SSC provides maximum direct control over business operations, processes, and talent. This level of oversight is especially valuable for organizations with highly specialized workflows and specific business functions or strict compliance requirements where maintaining full ownership is essential. 

This control comes at the cost of having full responsibility for building and maintaining best-in-class operations. However, many organizations are already finding a middle path: according to Deloitte about 65% companies that decide to build a Shared Service Center or Global Business Service delivery model, include outsourcing as part of their strategy. This hybrid approach allows them to retain control of their most complex processes while accessing specialized expertise.  

Leveraging an experienced outsourcing partner for shared services unlocks significant advantages, including cross-industry expertise, operational efficiency, established best practices, and proven transformation methodologies for vital business functions. These are capabilities that a new captive center might take years, even decades, to build internally. 

In the end, organizations must decide if holding on to complete control delivers greater value than partnering for specialized expertise in specific business processes and sustainable growth. 

Speed to implementation and value realization 

Building a captive SSC with global business services is a demanding, resource-intensive journey. From choosing a location and setting up the entity to recruiting talent and rolling out technology, organizations often face an 18 to 24-month path before achieving full operational maturity. 

The outsourcing model, by contrast, offers a significantly accelerated path to value. A seasoned provider already has the infrastructure, talent, and business processes in place. This allows for a much faster transition and enables the business to achieve cost reductions and efficiency gains in a matter of months, not years. 

In Latin America, 58% of companies are already using a hybrid model combining global business services or captive and outsourced shared services, rather than fully captive or fully outsourced operations. This reflects a trend toward balancing control with speed, cost, and access to specialized talent. 

Leaders must be clear about their organization’s transformation timeline. When speed and agility are non-negotiable, outsourcing is the proven path to faster results, operational efficiency, and a stronger competitive edge. 

Talent acquisition and development 

A shared services captive or global business services model requires the organization to become an expert in recruiting, training, and retaining talent for a wide range of back-office functions. In today’s hyper-competitive labor market, this has become a significant challenge, especially for the specialized skills required for automation and analytics. 

A trusted outsourcing partner brings scale and a ready-made talent pipeline, giving organizations access to a broader and more diverse pool of skilled professionals. They handle the full scope of talent management, from recruitment to development and retention, as a core part of their business model. 

This outsourcing model is especially valuable when it comes to high-demand, niche skills, allowing organizations to access them without competing in an already crowded market. 

Innovation and technological advancement 

While a captive center or global business services model can certainly innovate, it is often limited by internal budget constraints and competing corporate priorities. Securing significant investment and buy-in for cutting-edge technologies like AI and advanced analytics for non-core functions can be a major internal challenge. 

Leading outsourcing providers, particularly those focused on digital transformation, act as strategic accelerators. Their core business model revolves around continuous investment in specialized expertise and a deep understanding of technologies and how to deliver the most value. This allows organizations to immediately infuse their operations with deep operational and technological expertise, ensuring their transformation is guided by proven strategies and best practices that deliver quantifiable and sustainable results. 

By partnering with an outsourcing provider for shared services, organizations gain more than cost savings. They secure ongoing access to innovation that keeps operations competitive, future-ready, and aligned with the latest technological advancements. It’s a strategic approach to accelerate your digital transformation journey by leveraging a partner whose core business is to stay at the forefront of what’s next. 

Cost structure and investment 

Starting up a shared services center requires significant upfront investment in facilities, technology, and talent before delivering any return. Once established, the model often locks organizations into fixed costs that are difficult to flex as business volumes shift, which makes it harder to stay agile in a fast-changing market. 

Outsourcing turns a large upfront investment into a predictable and flexible operating expense. With this outsourcing model, costs scale up or down with business demand, giving organizations a level of financial agility that a captive center cannot easily provide. 

This shift from fixed to variable costs is especially valuable for companies that want to preserve capital while improving budget predictability. 

Why choose Auxis for your shared services strategy

The modern shared services discussion is no longer about choosing captive or outsourced. It is about finding the right partner to accelerate transformation. Auxis bridges this gap by combining the control and cultural alignment of a captive model with the expertise, speed, and innovation of a leading outsourcing provider.

Our nearshore platform, decades of hands-on consulting experience, and leadership in intelligent automation enable us to deliver solutions that are faster, more flexible, and built for continuous improvement. We do more than manage your back office. We transform it. 

Ready to explore what this could mean for your organization? Schedule a consultation with our team to discuss your strategy. 

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