When we talk about the model of outsourcing, our first thoughts are cost reductions, efficiency improvements, and access to better resources and technology. However, at the root of outsourcing is the aim of a business to grow and perform better, increase customer bases and therefore become more profitable. Some businesses enlist the help of business process outsourcing (BPO) companies because they either cannot afford the level of skills or technical capabilities or it is not cost effective to hire a certain skilled workforce to compete with other, bigger players in the industry. Keeping all of this into context, keen care is required while choosing a BPO partner. Today we will discuss the five requisites for accounting operations outsourcing, such as bookkeeping.
What are my actual targets?
When you are making a decision for hiring a bookkeeping outsourcing service, do not get distracted by the shiny testimonials that all point out to research and development skills of a particular company. Before you decide to partner with a BPO company, you must have clear goals in your head about what is it that your business needs and what sort of services will help gear you forward. Even though all sorts of business activities are being outsourced these days which makes it attractive to outsource the difficult tasks but that should not be your thought process. Keep your core business in your hands and with that information look for a company that will manage your books and keep you updated about your financial state. This will not only ease your business operations but also assist you in your overall goals.
Is there a communication barrier and if yes, how do I remove it?
When you hire a BPO partner, what you are in fact doing is taking on board a partner in your entire business trajectory. The goals and work ethics of the outsourcing company should be as good, or preferably stronger, as your own company. To ensure this, establish a smooth and hurdle free communication channel with your outsourcing partner. Keep your in-house team and external ally on the same page, and communicate what you wish to achieve from the BPO services, such as whether you want your financial statements to reflect your key areas, potential investments, or you simply want a detailed record to root out discrepancies and corruption.
What qualifications do I require in my BPO partner?
This is the key decisive factor while choosing a BPO partner and it applies equally significantly on every type of outsourcing agreement, not just bookkeeping. However, for the accounting services in particular you not only need qualifications related to legally appropriate financial statements and auditing regulations, but also some experience with small and big businesses before, as well as ability to prepare, interpret and report your financial data more frequently than just required through laws. Financial statements, that are the final outcome of bookkeeping in general, can provide you valuable insights about which areas of your business are lacking, which have the highest potential for growth, and which investments can behoove you the most. All of these trends should be visible to whoever is taking care of your books and they should be willing and communicate them to you, promptly. So keep an eye out for this skill set while signing on a BPO partner.
Will your BPO partner be able to scale their operations as per your needs?
Once you have the required information about the capabilities and communication channel of your potential outsourcing partner for your bookkeeping, you need to consider their performance during different business periods. If your own company operates in a field that is seasonal or may have fluctuating periods of activity, then your BPO partner should be able to scale their services up and down as well. One of the reasons why outsourcing has gotten popularity is this very scalability. A company does not need to constantly hire and fire employees for periods of high and low business activity. However, if your BPO partner cannot or does not agree to this periodic sort of partnership, then the benefits you ought to gain from outsourcing are seriously curtailed.
Will I be able to focus more on my core areas with this partnership?
This question is kind of a no brainer to think but it can have devastating consequences if not deliberated on properly. When you are deciding whether or not to sign on a BPO partner, it should not be an experiment for you. Now you may want to outsource one non-core segment first, but your aim should be to evaluate the experience and rank the partnership as if it is going to be a long term contract. When you have an external company doing part of your work for you, you need to be able to trust them and be able to focus your energies and resources to other more significant and in-house tasks. This means doing your due diligence before signing the contract, trusting your BPO partner with the assigned tasks, and not having to give feedback for every small submission.