One in ten FDs to outsource
More than one in ten finance directors expect to outsource more finance function activities in the next two years, according to this week's Accountancy Age/Reed Accountancy Personnel Big Question.
One of the 11% of FDs in the survey who predicted externalisation said: ‘It is suitable for companies undergoing fast growth. We don’t outsource at present, but it is likely to happen in the future.’
The FDs follow the example set by big names such as BP Amoco, Pickfords and Sainsbury, all of whom outsource some finance activities.
But the survey indicated many are still wary of taking their finances elsewhere – 82% said they have no such plans.
‘Finance is an integral part of the business and should not be taken away,’ said David Gee, FD of Continental Microwave.
Lack of flexibility and loss of control were given as major arguments against outsourcing. ‘There is greater control when things are produced internally,’ said one FD.
Size also seemed to matter, as several said their businesses were too small. ‘It is much more useful being kept in-house and under control,’ said one FD whose company does not plan on change.
Another said: ‘It is difficult to see how some will benefit in the current climate from outsourcing finance. But once concepts are proven by blue chips, the marketplace will develop and expand accordingly.’
Links
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Sainsbury’s outsources finance activities