CFOs who have already used SSC or outsourcing are more likely to do so again in the future
By Jamie Lyon | Published 10:48, 27 June 12
One of the difficulties of the top finance job is balancing these rapid fire issues with the broader finance agenda and business as usual activities. I’ve spent quite a lot of time recently talking to finance leaders and running surveys on the challenges they face in transforming the finance function and in particular gauging their thoughts on shared services and outsourcing.
While remote delivery may not always be at the forefront of CFOs’ minds as they track the latest edicts from the euro crisis, and watch tumbling stocks and bank bail-outs. But transforming the finance function doesn’t stop just because the euro area policymakers can’t get their act together.
Our latest survey tracks CFO sentiment to gauge the effectiveness of their finance transformation programmes, and particularly their shared services and outsourcing arrangements. It makes pretty interesting reading. Firstly it isn’t a bad news story by any means - the prevailing sense is that CFOs are sleeping quite well on this particular front.
We are all familiar with the far-reaching benefits of outsourcing finance - reduced cost, standardisation operations, improved controls and to some degree this is borne out by the survey results.
However, there is a prevailing sense that today’s finance leaders are an ambitious lot - clearly they want and expect more from their shared services and outsourcing agreements; and that represents a significant challenge to providers.
The prevailing question for the CFOs who have been around the block several times on this one is: “What more can shared services give me? Reduced costs? Better customer service? Deeper financial insight? Better access to talent?” For providers, the survey suggests there is a big challenge to live up to these expectations - something like a grade B, but still room for improvement.
Maybe part of the challenge is that CFOs don’t quite know what success ultimately looks like with these initiatives. The survey suggests that for CFOs “success” in the shared services world is still mostly measured by cost reduction.
That said, getting out the crystal ball, it seems the future is reasonably bright for shared services and outsourcing, with those CFOs that had already taken the plunge being more likely to continue their investment in the future than those who hadn’t. That’s quite a vote of confidence in these strained times.