FSA highlights offshoring risks

FSA highlights offshoring risks

FSA points out the risks involved in offshoring your business operations

Offshoring represents a ‘material risk’ to market confidence, reduction of financial crime and consumer protection, according to a new report by the Financial Services Authority.

The analysis of 15 financial services firms with offshoring operations found that maintaining management oversight and ‘control from a distance’ was the biggest problem they faced in keeping risk manageable.

Other areas of risk identified in the report included staff attrition in India, which is high at the moment and could impact service provision. Business continuity planning is another factor that offshorers need to ‘increasingly monitor’, especially when new processes and functions are migrated.

However, the FSA said that ‘most’ companies documented all their processes when dealing with a migration of processes, which enhanced these companies’ understanding of their work in offshore locations while improving their processes in the UK.

Martyn Hart, chairman of the National Outsourcing Association, said that the FSA publication was just ‘half a report’.

‘The FSA is looking at “steady state” operations that are up and running. But there are higher risks in the implementation of offshoring.’

Hart added that it was obvious that there were more risks involved in offshoring than running processes in-house.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource