Small Business Guide To Offshoring Finance And Accounting Processes
Unlike big corporations who offshore Financial & Accounting (F&A) business processes, for a small business it is an arduous task. Small businesses may not have the right resources to find suitable service providers to outsource their accounting business processes. In this article we will explore four simple steps, small businesses can follow using their existing resources to identify and manage the offshore service providers.
Step 1: Identifying What Finance and Accounting Functions to Offshore
The best way to discover what F&A functions to offshore is to ask the following questions and find answers to them:
1. What are the non-critical F&A functions that can be offshored with minimal guidelines to the offshore vendor by your employees?
2. How the finished work from the offshore service provider will be integrated into your complete F&A process?
3. How the offshoring will affect your employees who are performing those functions now?
4. How the instructions for performing the F&A functions will be communicated to the offshore provider?
5. How the finished F&A function from the offshore vendor can be measured for quality?
Step 2: Selection of Finance and Accounting Offshore Provider
The difficult challenge is how do you know who will be appropriate for your needs? Visit their web site and find more pertinent information about the offshore service provider. From the web site you may find answers to most of the following questions:
1. Do they have existing customers that you can do a reference check?
2. How long they are in business?
3. What are the offshore provider's F&A service offerings?
4. How the company has been setup in handling privacy, security, and confidentiality of data?
5. Does the company have a regional presence in the country where you are located?
Step 3: Pilot Project with Offshore Vendors
Based on the results in Step 2, you can narrow down to one or two offshore vendors for the pilot project. The main purpose of the pilot is to find answers to following questions:
1. How well they have completed your work based on the instructions you provided to them?
2. Does the offshore vendor have a cultural fit to operate with your own internal employees?
3. What pricing models do the offshore vendors can work?
Step 4: Finalizing and Contract negotiation with the Offshore Provider
Based on your findings in Step 2, identify one offshore vendor to outsource your accounting work. In this step you need to start the outsource contract negotiation with the offshore vendor. This step should answer the following questions.
1. How long the contract needs to be signed?
2. What type of outsource pricing model will be most cost effective?
3. How long the offshore vendor needs to provide the service after the end of the contract?
4. How the offshore vendors will maintain the quality of their work?
5. How the security risks will be addressed in the contract?
The offshoring of Finance and Accounting functions is a growing phenomenon and mostly big corporations are gaining advantage of it. By following these steps small business can also successfully offshore their Accounting and Finance work and increase their productivity in a cost effective way.
About the Author:
Get more knowledge about outsourcingand the current trades of outsourcing. All Related Information about BPO and KPO is available on our web-site. Do visit our website and get more knowledge.