Is your firm having trouble keeping up with its workload? Richard Hattersley explores outsourcing your workload stresses to India.
For years, businesses have exploited outsourcing to curb expenditure. Small to medium sized practitioners can lessen their costs of hiring and training new staff by embracing opportunities introduced by globalisation.
Our website analytics show a healthy pocket of Indian readers, which confirms the prevalence of British practitioners transferring work overseas to concentrate on their higher fee earning work and client care.
Sanjay Swarup wrote on AccountingWEB about his company SKS Business services that outsources basic accounting work to India. “We are part of a global economy and should be getting work done where it is most suitable to do so,” wrote Swarup. “Whether that be head-office, a low cost UK destination or overseas.”
Costs aren’t the sole reason practitioners opt for outsourcing, however. As Matthew Elliott, the specialist for Outsourcing at IRIS Software, explains: “Outsourcing requirements focus has moved on in recent years from cost and delivery times to support as it has become more widely adopted. Very rarely are practices looking to make more profit, they are looking for a partner (not a supplier) who can support and strengthen their business and help achieve their business goals”.
For American accountant Patricia Bell Harik, it was staff shortages which necessitated outsourcing tax work to India. She told AccountingWEB US, “Five years ago, we were forced to do this because we couldn’t find any staff members”. By outsourcing, she said, she eliminated the usual overhead expenses associated with in-house staff members. ‘It’s like employee leasing on a smaller level,” said Harik.
Despite the savings, though, outsourcing remains divisive among practitioners. On a recent AccountingWEB’s Any Answers thread, some users aired a moral aversion to outsourcing. Others were concerned about the quality of work. Chatman wrote, “I tried outsourcing to two different Indian firms before on-line accounting services like Xero and Clear Books became big and I gave it up because the quality of the work was so low and communication was difficult”.
The Director of finance and treasurer for the Centre for Applied Linguistics (CAL), Anna Douglas’ frank comments to our US site aligned with these criticisms. “Keep in mind that over the long term, outsourcing costs you greater than it saves. You will end up losing the few talented individuals that you had hoped to retain”. Douglas vexed at the quality of Indian chartered accountants that she dealt with, and the language barrier and time difference made communication difficult.
Not everyone suffered the same subpar experience. AccountingWEB user Paul Scholes wrote, “Quality is obviously the main concern but that applies whether I'm employing someone here or somewhere else so, again, it’s supervision that’s key”. Edhy, an AccountingWEB user based in Pakistan, agreed, “The key is, as already mentioned, invest in training and keep supervision to get long term benefits. Further outsourcing generally transfers low value added work offshore and frees resources for more value added work at home”.
For Elliott, Specialist for Outsourcing at IRIS, the fear of subpar accountants is groundless, saying: “What differentiates us in the market; our offering isn’t a third party operation; it is run by highly trained IRIS staff working in a dedicated IRIS office in Chennai, India”.
But outsourcing’s appeal may be usurped by technology. As Glennzy points out, “products like Receipt Bank will replace the need to do it”.
What’s your take? How has your experience with outsourcing been?