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July 25, 2007
Maturing Finance & Accounting Outsourcing Market
Findings from a new Everest Research Institute study reveal that among all outsourced General and Administrative functions, Finance & Accounting Outsourcing (FAO) has the highest rate of global sourcing adoption, with 77 percent of contracts having elements of offshore delivery. As operating models continue to improve and output quality rises, more global buyers are looking to source a growing number of skills from multiple regions, and suppliers are driving innovation beyond pure labor arbitrage to remain competitive.
The study, entitled “Global Sourcing in Finance & Accounting Outsourcing,” reveals that while labor arbitrage and productivity improvements can potentially save buyers between 30 and 40 percent on their direct-costs, these are one-time benefits which typically stagnate as the deal progresses. As such, buyers are seeking contracts with continuous improvement parameters and innovative sourcing models such as a combination of global sourcing, technology enhancements, and process improvements for optimal service delivery and ongoing cost savings.
The study also recognizes key responsibilities for buyers. To identify a solution that fits their needs in this complex and competitive market, buyers must assess niche providers, delivery locations and global solutions. Buyers also will be responsible for co-driving innovation initiatives, such as engagement structuring and management, throughout the project lifecycle.
To read more about the evolving global sourcing trends in FAO, an extract of the report is available at www.outsourcing-center.com.
Posted by jbowles at July 25, 2007 08:29 AM
