You’ve probably heard the terms ‘insourcing and outsourcing but how about ‘backsourcing’?
Backsourcing is the term being used for companies that are bringing previously outsourced functions back in house. So in a nutshell insource + outsource – outsource = backsourced.
So after such huge investments to outsource certain processes within an organisation why would you go to all the expense of backsourcing that process?
Many organisations originally outsourced work to save costs, offer a better or different service and save the cost of having to update legacy systems. Outsourcing also avoids recruiting qualified and capable reliable staff, which is often a challenge.
So why are many companies and practices now looking to backsource certain operations? It could be down to a service that was promised not being delivered, rising costs, lack of internal control or change in contracts to mention a few reasons.
Another factor, especially in the Accounting industry, is that cloud accounting tools are increasingly sophisticated and cost effective. This means the automation of a great deal of process and a much lower cost to get the work done. If you couple this with the benefit of maintaining control of service delivery, then there is a strong case to bring certain accounting service ‘back’ within the firm.
But the major challenge of recruitment remains. To employ qualified, dedicated staff who can use the new cloud software is difficult. I am sure you are aware of practices that have purchased other practices not only to gain more clients but to acquire qualified staff. This is especially prevalent when it comes to bookkeeping.
At Team 4 Solutions we work closely with many Accountancy practices on a ‘partnership’ basis. Avoid the pitfalls of traditional outsourcing, but also the challenges of relying solely on in house staff.
What does that mean? It’s very simple. We do the bookkeeping, you do the accountancy. We own the bookkeeping relationship with the client, the accountancy practice owns the accountancy relationship with the client and we refer business to each other. How simple is that? Well – after all – we are a team!