In the outsourcing industry, we’ve witnessed the transition from Outsourcing 1.0, the first-generation of colossal and complex contracts with top tier companies, to Outsourcing 2.0, with smaller contracts being delivered offshore, on-shore and near-shore. The over-arching banner that spanned both the 1.0 and 2.0 eras was “cost reduction.”
However, the floodgates of F&A outsourcing have opened, with scores of automation solutions, a deluge of cloud-based systems and a number BPaaS offerings, making it more accessible to all companies. While cost reduction is still intensely important, it’s is no longer a differentiator. And, it’s no longer enough. CFOs and key stakeholders are looking for more. They are looking for a New Generation of F&A outsourcing.
Welcome to the New Generation of F&A Outsourcing.
A generation where cost reduction is a given, but 2014 CFO priorities like better data quality, better integration and access to technology are a must-have to deliver value.
Better Data Management – Despite years of talk, organizations are still struggling to make progress in managing the consistency of and making sense of their data. It’s the old scenario of “lots of data, no information.” New Generation F&A outsourcing helps companies quickly sift through large amounts of financial data to gain decision-making insights. From revenue assurance to working capital analytics, clients must be able to leverage their data to improve the quality of their Accounts Receivable portfolio, maximize cash flow and drive strategic initiatives. It’s killing their business opportunities otherwise if this cannot be managed effectively.
Fully Integrated Solutions – CFOs worry about the lack of integration between the finance function and other parts of the business. BPO providers have got to be brilliant at delivering integration. (Stay tuned to this blog in the coming months as we expand on how Sutherland can be a “common conveyor belt” that runs through the various discrete silos.) Like that other “i-word”, innovation, integration will be at the top of every CFO’s priority list in 2012. Through integration and a holistic end-to-end approach F&A’s outsourcing value proposition is expanding beyond the bottom line to directly target the clients’ top line performance.
Transformative Technology & Tools – Company leaders need technology and tools that can help improve insights and reporting, monitor business performance and process efficiency, increase transparency and last but not least, help with collaboration and knowledge sharing. And, oh by the way, the solution needs to integrate with existing and legacy systems.
New Generation F&A outsourcing offers organizations the ability to access add-on tools that improve existing technology and take advantage of emerging technologies like robotics automation, cloud and mobile. With these tools in place, companies are in a position to achieve better insights and improve productivity, all while working within the parameters of their existing systems.
For the F&A outsourcing industry to continue to grow and evolve with our clients, we need to shift to a New Generation mode of thinking – one that is strategic, value-added and co-created in a true partnership. It’s unacceptable to rest on the laurels of cost reduction. We need to move up the value chain to create innovative solutions that have strategic impact and C-level visibility within client organizations.
In my next post I’ll be expanding on automation technology. I hope you’ll join me. In the meantime, I invite you to schedule a free assessment of your current practices. Comments? Questions? I’d be happy to answer.