Outsourcing: time to return to the source?
Firms should not become over-reliant on outsourcing
As a fellow accounting professional and promoter of outsourcing, I support
the view that all firms need to be true business advisers. Outsourcing supports
this. But it is in no way a service that replaces the firm. We do not recommend
that clients outsource all their compliance work some should be retained in
house due to its nature and also provide the ‘fodder’ for trainees to understand
the basics.
Outsourcing allows efficient delivery of basic compliance processing and is a
far from simple economic decision. Rather it is a service that supports the
longer term structural need of firms through enabling local staff to continue in
a client-facing capacity and remain focused on value added services.
With a reduced intake of people at trainee grades, outsourcing offers a
solution to ensuring smooth delivery of compliance services, on time with
reduced time spent by more senior staff on training staff to perform basic
compliance activities.
It should be stressed that the success of outsourcing depends to a great
extent on the mindset of firms and clients and the degree to which they embrace
technology. Our clients are finding outsourcing to be a highly efficient and
effective solution to the delivery of basic compliance work. Typically firms
outsource up to 50% of their compliance portfolio, representing up to 10% of
total income. While this may grow, it won’t result in an empty office.
Choosing a professional outsourcing partner is key to the success of
outsourcing and in turn to the firm in prioritising time and resources to
providing the higher value services and the development of higher skills.
In the constantly evolving economic climate and increasingly competitive
market for firms and clients alike, advisers need to be well positioned to be
highly nimble and responsive to clients’ needs.
The need is exacerbated by the increasing prevalance of competing advisers
with MBAs. Firms can only maintain success through continued credibility. It is
key to the long-term success of professional firms to widen the sphere of
services that require more well-rounded business advice and develop quality
relationships with clients. Having highly skilled staff is essential to support
this.
Vipul Sheth ACA, CTA, is managing director of Advance
Track Outsourcing