Put business people together and it won’t be long before someone mentions outsourcing. It might be in the context of freeing time for the other activities you’re told you must do to compete in the market place. Or to do with concerns about maintaining service quality. Or even the difference between outsourcing and offshoring. Whatever the reason, the consensus is increasingly likely to favour outsourcing. And with new research showing that 1 in 4 practitioners see excessive workload as their biggest tax-year-end worry, looking closely at outsourcing for your accountancy practice or SME is highly apposite…
Along with the immediate challenges facing accountants (and anyone responsible for year-end accounts in an SME) as another tax-year-end approaches, the factors that often restrain businesses make a good starting place for a few seasonal thoughts…
What’s holding your organisation back?
You probably won’t be surprised to hear that strategy issues, weak marketing, flawed pricing, underwhelming service delivery, poor people-management, lacklustre systems and measurement of the wrong things often hold ambitious accountancy practices (and many other SMEs) back. They’re all important. In an ideal world we’d all have plenty of resource available to respond. Unfortunately, you’re probably so busy with your day-to-day, and now with the added challenge of a fast-approaching tax-year end, that you haven’t the time and resource to spend more time on them.
Imagine working on your business more
Now imagine what you’d achieve, at any time of year, if you could only do more work on the business as well as in it. Maybe outsourcing would help, especially if it freed you and your team from some or all of the book-keeping, management accounting and payroll drudgery… Even more immediately, as the year-end-tax season approaches, imagine outsourcing relieving your workload and staffing worries. If you're an accountancy professional, this will be particularly relevant if you’re among the 1 in 4 practitioners who told Bankstream and AccountingWEB that this was their biggest concern. (See the Bankstream Accountants Confidence Index at accountingweb.co.uk/bankstream)
Do you feel pressured to do more?
As an accountancy practice or an SME in another field, the pressure to do more work on your business seems relentless when you read another business improvement article reminding you that increased focus on client service, technology integration, digital mobility, talent management and succession planning, and effective implementation of social media as a business tool are vital for your future success.
Where will the time come from?
This is all good stuff, but where will the time come from to make the most of these trends, at which point it makes sense to think about the increasing importance of outsourced professional services? Whether you are an ambitious partner in an accountancy practice, or the owner manager or financial director of an SME, arranging for (trusted) others to undertake duties such as book-keeping and payroll is an accepted way to free precious senior management time for other business tasks.
Concerns about containing employment costs
The options available include hiring more full-time staff, part timers or independent contractors. And then there’s the role of offshore or UK-based outsourcing. As you consider the options, notice how the perennial management challenge of containing employment costs surfaces. So do opportunities to outsource as a way to get specific tasks done at a fraction of the cost of using staff and contractors. Not just for producing accounts, but for specialist bookkeeping with management-accounting and payroll-bureau services. And let’s not forget the currently ‘hot’ payroll-related topic of auto-enrolment.
We know outsourcing can be helpful
SMEs have a long tradition of outsourcing. Going outside for specialist services can be particularly attractive to smaller accountancy practices as well as SMEs. They’re the organisations where the cost of hiring more staff is particularly onerous – especially if those employees won’t be fully utilised throughout the year. This is even more important when, as is often the case, limited availability of staff to do the work is a greater issue than simple cost-cutting – the position many accountancy practices find themselves in as the start of 2016 approaches. Of course, saving money (and therefore making money) is important to every professional practice and company. You only have to compare typical hourly rates for accountancy professionals or the equivalent for the MD and FD of an SME against those for outsourced bookkeeping or payroll services to appreciate the attraction.
The importance of the right outsourcing partner
When you work with the right outsourcing partner (note the emphasis, this must be a suitably experienced professional with proven ability to add value), there’s another bonus. You automatically get scalability to meet your evolving requirements, whether prompted by expansion or contraction of the practice. Suddenly, we’re back with the worries and responsibilities of hiring and firing staff in response to variations in workload – and outsourcing holds the simple-but-elegant answer…. When you hire new employees, one attraction of bringing them into your team should be the skills, expertise and experience they bring. It’s the same with your outsourcing partner. Imagine, for instance, the expertise you could access by outsourcing to a ‘battle-tested’ specialist who’s seen several decades on the accountancy, book-keeping and payroll front-line.
The double-focus benefit
Whether you’re the owner-manager of a small company, a practice partner or an interim FD, there’s even more to be excited about when you consider the extra focus that professional outsourcers can bring to specialised work. They’ll also help you focus better on building and running your practice or commercial organisation. It’s like using a specialist designer, copywriter or photographer to deliver focused services. Just because bookkeeping with management accounting, or payroll-bureau services, feel closer to home than other specialisms doesn’t lessen the potential for financial, operational and strategic benefit.
Enviably specialist tools and knowledge
It’s not just about specialist skills and focused professional minds concentrating on what they do best either. That’s because you can expect your specialist outsourcing partner to have a wider range of more up-to-date and more specialised accounting, bookkeeping and payroll tools than you. Think about it. Are you really current with all the latest bookkeeping software? Or on top of every change in the already-complex laws and regulations that apply to book-keeping and payroll? Because this should be part of what outsourcing practices can focus on, they can afford to (indeed, they must) keep current with the very latest Sage, Xero or other applications that they've built their services around.
Benefits beyond next April
By the end of today, the annual year-end accounting frenzy will be even closer. Whatever your ambitions for your commercial SME or professional practice, outsourcing could play a part in reducing worries like those identified in the Bankstream/AccountingWEB research. Even more exciting, what if outsourcing enabled you to go beyond mere seasonal relief by underpinning a major step change in your performance and standing in the marketplace? Now, that really would make a special year-end! Founded in 1994, BookCheck Ltd, with 54 employees at several UK offices, successfully services the needs of business owners and directors. BookCheck is totally focussed on just two key services: Sage & Xero bookkeeping with management accounts and Payroll-bureau services with auto enrolment. To find out more about taking the hassle and worry out of your auto enrolment and payroll, call 0800 883 0711 or email us.