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Outsourcing or Offshoring – Confused between the options?

November 30, 2020 | Corientz

Accounting firms are striving for an optimised business model for growth and for excellence in the business. Accounting firms today are inclined to outsource tasks like bookkeeping, recording transactions and producing reports for clients.

The prevalence of cloud technology is one of the major factors for this rising inclination towards outsourcing and offshoring.

Clients often demand quick results using the latest technology, but this comes with two major challenges – the lack of employees with the needed skillset, and the high cost of employing trained staff to handle this technology. Upskilling existing employees also calls for a massive spend on training. There is thus an opportunity here for accounting firms to play a value-centric role, lowering finance needs in terms of operational costs and training expenses, by outsourcing tasks requiring these highly-skilled resources.

Many reliable and profitable accounting firms are upgrading themselves using outsourcing or offshoring strategies. The dilemma they face is whether to outsource or to offshore. Let us help you make this choice.

What Is Offshoring?

Offshoring is the process where your work is being done offshore by employees of your own company or a subsidiary company belonging to you or your group. It takes advantage of the cost differentials of relocating factories or operations from costly countries to cheaper economies.

What Is Outsourcing?

Outsourcing is about moving internal operations/ processes or tasks to a third party. Transactional activities are moved to an expert in the field so that the organisation can focus on its own area of expertise.

The prime motive behind both outsourcing and offshoring is to cut costs and increase profits using compliant technology to streamline the process. Companies can thus focus on core competencies while utilising the skillsets of talented professionals at a reduced cost.

How Does Outsourcing Benefit You?

Outsourcing a few key accounting processes can help you competitively:

Helps you focus more on high-value work.

Accounting firms and companies need to spend more time on  strategic  advisory and  consulting activities to bring in more  clients and build more robust relationships. Outsourcing routine bookkeeping tasks  will allow you more time for productive outreach rather than number-crunching and  monotonous work.

Better turn-around time

Outsourcing to expert accounting service providers who are professionally trained  in accounts, tax preparation, accounts receivables and payables, bookkeeping and payroll, results in faster turnaround time than provision  of these services in-house.

Increased productivity

When you outsource routine tasks, it triggers employee productivity resulting in boosted revenues. Outsourcing enables you to widen the suite of services you provide, for example, business advisory services and cloud accounting.

Wider market

One of the biggest advantages of outsourcing is that now you no longer have to refuse work for lack of capacity. Previously, while trivial services like bookkeeping felt like tedious work with minimal return, having access to an outsourcing team gives you the ability to expand your customer base and take on the work previously refused.

Cost savings

Outsourcing to an accounting team reduces the recruitment and training needs for in-house staff of the firm.  As you grow more familiar with your new partners, and trust their abilities more, it also helps you take on new, different projects.

What should you look for in Outsourcing Companies?

Your first concern will be data security – in today’s world, with everything online, DDOS, hacking, phishing, ransomware, GDPR, you need to be sure that any company you have chosen will maintain and work with your, and your clients’ data, as securely as possible, complying with all cybersecurity laws.

Your next concern will always be reliability, as you have to answer to your customers. You will want all your work to be done to a high standard, with minimal supervision needed from you, submitted in a timely fashion, and adhering to compliance deadlines.

In conclusion

Accounting outsourcing  began as a cost-cutting measure, but has grown to be  a sustainable working model with significant strategic implications. It allows you access to advanced technical, technological and accounting capabilities while addressing staff  and skills shortages, expands your market, aids in increased focus on your core expertise, and improves your bottom-line.

Corient  helps improve all your metrics from your topline to your bottom line. We are GDPR compliant, cybersecure, ISO 27001 certified, have a highly trained, motivated, fully qualified, experienced and enthusiastic team – we tick all the boxes! Do get in touch with us for  more information , advice or help.