To stay ahead in business, organizations need to step up their game and gather available resources to make them successful. Small to large companies have a set of challenges when it comes to business operations. Financial services play a huge role in running a firm smoothly.
Payroll, monthly accounts, tax deductions, tax planning accounts serviceable and payable, risk management analysis and compliance regulations are part of financial services. Not every firm has the time, resources, skill set, and budget to handle the financial needs. Outsourcing financial services are the best solution once you identify the benefits.
Tips to choose a financial outsourcing partner
There are some tips to consider while choosing a financial partner by the organization before deciding on outsourcing the services:
- Primarily, the company has to identify the reasons why outsourcing is beneficial to their business. After finding the strategy behind outsourcing decision, communicate it with business partners and come to a unified opinion.
- The next important step is to explore the various options that are available for outsourcing. Some organizations work well with shared management outsourcing while others give full control to the outsourced firm. Depending on the budget, choose nearshore or offshore financial partner.
- Since financial responsibilities are being outsourced, evaluate the internal team associated with it and check if they have the required skills to manage the process of outsourcing their duties.
- Lastly, finalize the benefits you reap from outsourcing and the scope of outsourced duties.
Gather the list of possible financial outsourcing partners that share same your vision and evaluate each firm based on the services they can offer to help you reach your goal.
Look at the quality of resources offered by the outsourcing company as it is the key to get a good result. Make sure that you cannot get a better financial partner at a budget better than the chosen outsourcing firm. Ask questions like, do they have the best technology? Will they be able to work overcoming the time difference? Or do they have the expertise to handle issues regarding employees? Get answers to all these questions before choosing. The outsourced company should have a skilled team that can offer the services lacking in your organization.
The scale of Operations:
If your business is on the verge of expansion, the outsourced firm should be able to handle the scale of operation to your growing needs. You can choose between major outsourcing firms that have grand experience and that can offer varied quality services or small firms that solely focus on financial outsourcing with good skill set. The latter choice can give you better attention to your needs rather than being lost in a sea of customers by an outsourcing giant.
If the initial contract with the outsourcing firm goes well, business organizations are likely to continue with them and offer more services for outsourcing. So the outsourced firm should have technical and manual resources to handle additional work.
Communication of ideas and tasks is required between outsourcing partner and business to work efficiently. Poor communication will result in costly errors at the end. Communication about deadlines, technology upgrading, project regulations, and the transition of financial roles is crucial. Clarity of instructions and conformation from the outsourcing partner are vital for effective communication.
Talk about the preferred method of communication with an open mind about time-differences, schedule conflicts, and virtual meeting rooms. Get clarity on the frequency of communication to build trust and understanding between firms.
One of the biggest motivating factors behind outsourcing is to reduce the cost of resources and operations. Find the difference between keeping the work in-house and outsourcing and check if it is profitable to outsource. But the reduced price might not always give the best output. Cross-check the skills offered by the outsourced firm with the budget allocated and make an informed choice.
Forming a partnership with an outsourced firm is a long-term deal. The partnership can work if they have a similar work culture or at least have a good understanding of your company’s needs. Cultural and language compatibility needs to be similar to an outsourced firm to work well. This is one of the reasons for organizations to draw up service level agreements hoping that misunderstandings won’t arise in the future. Adhering to the agreement will result in delivering the right kind of services in the specified timeframe.
Adaptability to trends:
In the world of business, changes come in the form of compliance policies, regulatory rules, tax policies, and accounting rules. The outsourcing partner should be knowledgeable about changes and implement them in their services. Make sure to inform offshore outsourcing firms about compliance regulations as it can affect the business operations.
The major concern for businesses to outsource financial responsibilities is the stability of the hired company. The chances of an outsourced firm disappearing from the business world are not uncommon. Choose an outsourcing firm that has stable ownership and has a good reputation in delivering the services on time.
Draw a contract for the duration of services offered and legal liabilities that come from absconding it. Choosing a new firm without stability can result in huge losses to your organization if they disappear suddenly. The financial stability of the outsourced firm is important to keep your operations streamlined.
The experience of the outsourced firm is a testament to its successful running. Check the portfolio of services offered in past years to know about their work ethic. References and client testimonials are a great deal of help when it comes to choosing an outsourcing firm. Looking at the testimonials will give an idea about their delivery time and customer support services.
An outsourcing partner should be upfront of their support services and how they handle critical situations. Check sample work of the outsourced firm if you like their business ethic. It will give you a general idea of their capabilities, quality of work and their technical stand.
I’m currently working as Charted Accountant with financial services outsourcing companies. I have a great passion for outsourced accounting. In the last couple of years, I have worked with big and small clients across numerous continents. I have a keen interest in payroll outsourcing services, bpo services India, outsourcing financial services, outsource Back office services, offshore Accounting etc.