There are a number of myths surrounding the outsourcing industry. Most of these stem from a lack of awareness and fear of the unknown. Below are three of the primary myths around the outsourcing industry and how they’re not as valid as you may believe.
Myth 1. Jobs will go offshore
One of the most prominent myths regarding outsourcing is that it pushes jobs overseas. This claim has been used time and time again however, there is minimal data to back this up and there are many points to actually prove otherwise.
The myth claims that because the same accounting function will now be done overseas the people who were doing it before in the home country are now obsolete. Yes, that particular task will no longer be done in the home country but it doesn’t mean that the staff has nothing else to do now.
Many accounting firm owners who have outsourced have a similar story to share. They began to outsource by hiring a team of two or three people overseas and after some time they were able to expand their operations and needed to hire five people locally to handle the additional work that was coming in.
Outsourcing the high volume low-value work overseas frees up your time and resources which lets you focus on providing additional higher-margin services such as business advisory. By utilising an outsourcing accounting expert, you not only offer the traditional services to clients, but you can also hire additional staff to assist with the new higher-margin services.
This actually debunks the myth that outsourcing causes jobs to go overseas. By taking advantage of outsourcing you not only help to upskill current staff but you’re also in a position to offer more opportunities to the local workforce.
Myth 2. I’ll lose control of my accounting business
Most accounting firms considering to outsource some of their functions overseas tend to get a bit caught up and feel they may lose control of their business over time. This myth tends to stem from the notion that since the work is getting done thousands of miles away in a different country it becomes much harder to supervise and maintain.
This is understandable however; with the selection of a quality, professional outsourcing company, it doesn’t need to be a major concern.
Before any business commits to an outsourcing company, they should check on the reporting procedures, means of communication, whether there is a named manager and a dedicated team of people. The outsourced team should operate as an internal team and with today’s rapid means of communication, video conferencing, Skype and so on; a remote team does not have to be remote.
The implementation phase is key to ensuring control is in place. All standards and procedures should be agreed upon before any work begins and time should be spent with the new team to establish working practices. If in the future the owner feels as if they are losing control of certain functions they should raise this concern.
The practice owner should also be prepared to give up minimal control over certain processes, as that is why they have contracted the outsourcing firm in the first place however, they should always maintain their own final authority. Regular audits of procedures should be carried out to ascertain that standards are being maintained. In brief, the myth of losing control becomes obsolete as long as clear guidelines and open communication are adhered to.
Myth 3. My data won’t be secure overseas
One myth that keeps popping up is about how data will remain secure when it’s outsourced to firms overseas. The only way any outsourcing business will continue to operate is by instilling confidence in its current and future clients. It’s this fundamental concept that drives accounting outsourcing companies to invest in the best data security.
Before partnering with an outsourcing company, do your due diligence from a security perspective and make sure these points are met:
- Follows world-class security standards such as ISO 27001.
- Is GDPR-compliant. Preferably via a framework such as BS 10012:2017, as it’s the only available industry code of conduct that currently aligns with GDPR requirements.
- Maintains Non-disclosure agreements.
Outsourcing companies are fully aware that even one lapse will break the trust they have built up. In fact, most outsourcing companies will go above and beyond the normal security precautions to ensure data is not mishandled. If you ever feel that there is a data risk bring it up with your outsourcing partner to find a resolution.
A modern accountancy practice
In this day of technology and globalisation it’s easy to harness the true potential of outsourcing. The number of UK accounting practices that are outsourcing accounting functions is on the rise and understandably so. A modern accountancy practice should be composed of experts and strategic thinkers, so owners can spend less time worrying about things like year-end accounts, payroll tax, bookkeeping and VAT, and more on higher value functions.
For more information about how your practice can start benefitting from outsourcing feel free to get in touch.