6 reasons why many accountancy firm have got burnt
Meet any accountancy firm owner and chances are that they have at some point dipped their toe into the world of outsourcing. Unfortunately, many firm owners get ‘burnt’ and have a bad experience so never quite manage to get the full benefits of outsourcing. In this article, we explore why it is that so many accountancy firm owners have had a bad experience with outsourcing.
More often than not the reason most firms stop their outsourcing is due to poor quality work coming back. Whilst we can’t speak for our competitors, poor quality work coming back is often the symptom of the problem why outsourcing is not working, rather than the root cause.
Of course, no-one enters into a relationship with an outsourcer wanting it to go wrong. That would be madness. However, many accountants do start their relationship with an outsourcer with unrealistic expectations. The main one being that the outsourcer will be able to switch on their services on day one and can immediately grasp how the firm work. When you bring on board an outsourcing partner you need to treat them exactly as you would do a new member of staff. Sadly, many firms new to outsourcing don’t realise this. It takes time for a new member of staff to get how your firm works, and it’s the same for any outsourcer.
You wouldn’t expect perfect work from day one from a new member of staff. It’s the same with your outsourcer.
Poor quality feedback to the outsourcer
It’s stating the obvious, but if an outsourcer doesn’t know that things are going wrong or stuff needs to change, they are probably not going to do anything different. But that’s often exactly what can happen. The accountant receives back a job which needs some work doing to it. They then complete the work and don’t tell the outsourcer about the problems. A few poor quality jobs later and the accountant decides outsourcing is not for them.
Poor communication to the outsourcer
It’s hard to be a mind reader. It’s even harder to be a mind reader when you are 1000s of miles away from a client. Like any geographically disparate team, timely and regular communication is essential to how well the relationship is between the outsourcer and the accountant. The sooner the outsourcer knows there is a problem, the sooner they can rectify it.
Inconsistent processes being used in the accountancy firm
If your internal processes are inefficient, the last thing you want to do is outsource that inefficiency to an outsourcer. It sounds crazy doesn’t it! This happens regularly when it comes to accountancy firms starting outsourcing. In fact, we even had one instance where we were following the process as dictated by the owner of the firm. However, we could see on historical records that the firm itself wasn’t following its own processes. As an outsourcer we want to know exactly how we should slot into your workflow and exactly how you want us to work. If a firm doesn’t know how they should be working internally, this is when problems start to creep in.
Resistance from staff
Starting outsourcing work means change. Very often that change is not handled in the most effective way in an accountancy practice. As a result, we often see the actual start of the outsourcing relationship being held up by staff not identifying which jobs can be outsourced. It is imperative that all your staff are fully onboard with the decision to outsource.
Poor Due Diligence
We understand that choosing to outsource your clients’ work is a big deal. It’s really important, therefore, that before you choose an outsourcer that you do your due diligence on them. For example, what are their guaranteed service level agreements? Will you get a named contact to speak too? What are their working hours? How do they handle errors or mistakes from their side?
When an accountancy practices fails to implement outsourcing it is normally as a result of unrealistic expectations and poor communication. Get these two things right and you will find that outsourcing will be the best things you ever did for your practice.
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Arun completed his training as a Chartered Accountant in India in 2001 and has since been based in the UK. In 2005 he completed his ACMA and achieved an MBA (London school) in 2007, specialising in Strategic Management harnessing his academic skills to head up the operational side of the business and also to market the benefits of outsourcing...