The Advantages of An Offshore Shared Services Team are Bigger than You Think
22nd June 2014
Often times, when I meet with corporate CFO’s and discuss offshoring, I find the biggest push back is “the saving are just too small to bother with”.
CFO’s want to take relevant savings to the board and one or two heads just doesn't cut it in most cases.
It’s a very different workplace from when I worked in finance 15 years ago. Automation has reduced finance teams and month ends take on average 5 days not 15 days ( we were very proud of our 15 days if you can believe that). That leaves little scope for finance heads to show they are saving dollars as they put the rest of the business under pressure to cut costs.
Taking a longer term view of offshoring models, there can be greater advantages than one thinks.
1. Where there is skepticism that offshoring models don’t work, finance teams can lead the way in the organisation and “prove” success. Once proven, Financial managers are perfectly positioned to leverage their knowledge of the business structure and “help” other divisions save or leverage their budgets.
2. Finance is a highly “regulated/ compliant based” work and there is a strong argument that if finance can offshore, so should any division really. “If the conservative accountants can do it?”
3. Being proactive is a core component of the modern day financial professionals as we all know. We think managers who engage their business partners and provide saving or leverage opportunities such as offshoring, add real value to their organisations. This is the best type of advice you can give, making your business partners look great in the process.Long term cost savings in the overall business can be immense. We brainstormed savings against the organisation chart with a client. The result: Finance saved 120K (boring!), the rest of the business, with some work on their overall business model, could save millions.
Our approach is generally iterative and we emphasise the need to start slowly and “prove” the model. Once that is done, the real savings and leverage do come to the benefit of all.