Driving digital finance through finance and accounting outsourcing
The term outsourcing can have a negative connotation, conjuring images of layoffs and relocating jobs to third parties in remote locations. However, outsourcing can take many forms, and finance and accounting outsourcing (FAO) does not always mean the displacing of the finance back office. Specifically, FAO leverages digital technology to complement and support the back office, streamlining processes while providing enhanced transaction processing, reporting and analytics capabilities. It also allows key resources to focus on strategy, analysis and decision-making.
Many forces are leading companies to examine back-office processing and understand the benefits that outsourcing can bring, both small and large. For example, organizations are currently in a war for talent like we have not seen in a very long time. Unemployment is hovering near its lowest point in history and the demand for skilled labor is driving up salaries, benefit costs and related payroll taxes.
In addition, baby boomers are steadily retiring and fewer accounting majors are graduating each year. These reasons are major drivers for companies to adopt an outsourced finance model.
However, another major factor leading companies toward FAO is the opportunity for digital finance transformation. Technology advances rapidly and it can be confusing for middle market companies to get their arms around. From robotic process automation (RPA), automated bill pay and enterprise resource planning (ERP) solutions, to adapting operating models to account for globalization and regulatory, tax and accounting pronouncement changes, RSM’s innovative FAO platform can help companies steer away from unnecessary time and resources spent on manual bookkeeping.
FAO’s main purpose is not to replace the finance function; in fact, most organizations that utilize FAO still have a chief financial officer and financial employees in place, but outsourcing allows them to integrate more effective technology solutions and reduce headaches around the closing process. The FAO platform enables organizations to better manage complicated tasks, drive down costs and transition employees to focus on operations and sales rather than day-to-day repetitive tasks.
FAO for digital finance transformation
With today’s technology capabilities, organizations are embracing the concept of continuous accounting, where full-time employees no longer need to process transactions at various points of the month. By utilizing technology, FAO enables companies to spread activity out throughout the month so they can close the books much faster and generate more effective and timely compliance and data analytics. The digital platform brings value by providing information seamlessly, allowing companies to make agile decisions rather than performing manual work that requires substantial manipulation.
The idea behind financial reporting is to comply or to manage, and an FAO technology platform allows companies to do both more effortlessly. In many cases, organizations have a spectrum of disparate internal systems that don’t talk to one another and employees with varying skill levels. FAO presents a standard, efficient platform that can scale and grow as the company matures and continuously improves.
Ultimately, FAO utilizes leading cloud technology that is proven to interact seamlessly to provide a comprehensive finance solution, whether it is designed for a specific function or the entire back office. That technology provides key performance indicators (KPIs) and metrics which lead to better reporting and processing times by leveraging workflow and financial reporting automation to work in a consistent and controlled fashion. Companies save time by not performing analysis between multiple spreadsheets, but instead getting accurate, timely answers with automated back-office transactional processes and reporting.
A subscription-based pricing model is often another key consideration for companies when moving to an outsourced technology platform. This structure is typically a lower-cost option than internal solutions, because of FAO providers’ preferred pricing, packaged solutions and relationships with vendors. Instead of performing a selection process and choosing what works together, FAO providers have already done that, created a seamless approach; they can get companies up and running quickly. The subscription model also inherently creates more scalability, with the ability to quickly adjust resources up or down as necessary.
Executives have many critical issues to think about, including the growth of their business, regulatory requirements and people issues. RSM’s FAO platform provides an integrated solution that takes the complexity out of these challenges, providing real-time data to make decisions that drive strategy and the business forward. It brings emerging innovation and a fractional workforce that provides the right level of support to manage regulatory and reporting requirements and allows companies to comply and focus on the business.
If your company continues to get mired in workflows or processes that are simply not working, and spending significant time just closing the books, you likely have little time to analyze information and provide it to key stakeholders in and out of the organization. By leveraging an established FAO platform that has options and flexibility to model to your organization, you can get the benefits of both a more extensive technology platform and support through an outsourced organization.