In today’s fast-paced competitive world, businesses must focus on working to ensure that they maximize their revenue, translated as profits! While it is true that there will always be ancillary departments that will aid the revenue-making, growth and expansion of the company, companies must decide how many of such ancillary departments are they willing to shoulder.
This is because these ancillary departments are non-revenue-yielding departments. And all the generated revenue not only goes towards managing the cost of revenue-yielding departments but these ancillary departments as well.
One such department is the finance and accounting department. The arguments for outsource accounting services are equally weighed against the ones against such a decision.
Outsourcing Accounting Department
While it does make sense that finance handles one of the most critical tasks in the organization and therefore it makes sense to invest in the department, one must also remember maintaining a finance department would mean manpower and HR protocols- hiring, staffing, retention, bonuses etc., as well investing in the infrastructure for maintaining the department. This alone would constitute the sunk cost that far outweighs the disadvantages in outsourcing accounts department.
The following points might shed light on why it makes sense to outsource accounts department:
# Saves Resources
Resources that could’ve been hired to be used elsewhere can now be used in those departments that are revenue-generating since the accounts department has been outsourced. This saves a considerable amount of resources both in terms of manpower as well as infrastructure.
Besides, these outsource accounting services provider are usually located at those locations that provide cheaper labor and easier access to it which saves cost to the company rather than them having to hire local talent at a higher cost.
# Get Hold of the Latest Technology
It makes sense that an outsourced accounting organization would have access to the latest versions of software which makes providing solutions easier and valuable to the client. This removes the parent organization having to invest periodically in new technology to ensure they are ahead of the game.
# Focus On Revenue
With the burden of HR protocols and policies on the accounts department gone, HR can focus on retention and hiring policies for the revenue generating departments which would make those departments more value-filled and therefore better revenue generating.
# Access to Proficiency
An organization not in the field of finance would always be left wondering if the team hired is competent enough, given the critical nature of the department. But with an outsourced accounts department, proficiency comes added in the package because that’s the nature of the outsourced organization’s business.
Take A Leap
OHI is a specialized finance and accounts service provider catering to clients across the US, the UK and Canada. Our practices are customized to cater to the individual needs of small medium businesses. Our experience, deliverance quality, infrastructure, staff have made us consistently rank among the top accounts outsourcing organizations across the world.