In recent years, technology has had a profound impact on the processing and analysis of data within professional services, particularly within the accounting and legal sectors. Compliance work has become increasingly commoditized and subject to price sensitivity. In this environment, it’s not surprising that professional firms are critically reviewing resources and capabilities to remain competitive and profitable.
Outsourcing (and off-shoring) is increasingly mainstream. A recent industry poll suggested that 43% of accounting firms were outsourcing at least one service or function, with another 30% of firms saying they were considering outsourcing within the next year. Just 3% of firms were not inclined to consider outsourcing as an option to increase the capacity and efficiency of compliance production.
Where does your firm stand about outsourcing? Some of the key objections raised to introducing outsourcing include:
There is clearly ongoing concern over access to private data with outsourced services. However, it’s apparent that security can be a challenge no matter where the data is located. It’s a legitimate concern which quality outsourcing firms should be addressed through appropriate technology, policies and procedures.
Communication with people working in a different country and a different time zone can be a challenge. The focus must be on the development of strong internal systems for the flow of work and the sharing of information in a timely manner. An internal champion to manage the outsourcing relationship at a holistic level is essential.
The capabilities of our staff will continue to evolve as technology impacts the way work is processed. Many routine tasks are now being automated or eliminated altogether. A stronger focus on client relationships and advisory services is forcing a rethink of the type of people we employ and the skills they bring to their jobs. Outsourcing plays a critical role in defining the skills we hire and subcontract.
Progressive firms see outsourcing as an opportunity to refine internal systems and procedures relating to workflow, especially in relation to the collection and processing of data. This an essential part of the process of setting up and running an effective outsourcing division.
What are the key actions for success with outsourcing of compliance and administration?
If you’ve tried outsourcing in the past without great results, now’s the time to review the reasons for the challenges you had and to consider what you can do differently. Talk with colleagues who are having success with outsourcing about their journey and experiences. You’ll probably discover that you’re a lot more prepared this time around.