In today’s rapidly evolving financial landscape, CFOs must be adaptable and proactive, requiring a blend of strategic vision, technological expertise and strong leadership. However, organizational inertia, short-term focus and resource constraints often impede progress, prompting many companies to seek partnerships with third-party providers to achieve their goals.
A recent survey of CFOs conducted by Everest Group, supported by Conduent, across 200 U.S. companies, reveals insights into outsourcing solutions. The eBook based on this survey offers valuable perspectives on how companies can effectively employ outsourcing strategies to enhance operations and drive success.
Advancements in technology and the demand for consistent global processes have led more organizations to adopt centralized operating models. These models streamline operations, ensure consistent policies and procedures, enhance data accuracy and boost efficiency across the organization. The survey data reflects this trend, showing that companies using centralized models achieve higher levels of data, process and automation maturity compared to those with hub-and-spoke models. Despite these advantages, centralized systems can also present significant transformational challenges.
How CFOs can stay adaptable and proactive
The survey confirms that partnering with business process outsourcing (BPO) providers accelerates progress and helps internal teams overcome obstacles more quickly. Skilled outsourcing partners bring specialized industry expertise, advanced technology, cost savings, scalability, flexibility and risk mitigation to finance organizations.
Specialized industry expertise: Outsourcing partners provide access to a team of experts skilled in finance, accounting and procurement. These professionals bring extensive experience, stay updated with industry best practices and regulatory requirements and ensure smooth integration of data and systems.
Leading-edge technology: Outsourcing partners help organizations modernize and optimize their operations using innovative technologies like AI, machine learning and data analytics. These technologies enable intelligent process automation, real-time insights and predictive analytics, enhancing efficiency and productivity.
Cost savings and operating efficiency: Outsourcing reduces costs associated with in-house operations and accelerates process workflows, leading to significant cost savings while improving overall performance.
Scalability and flexibility: BPO partners offer the agility needed to adapt to changing business demands. They provide customizable solutions that align with specific needs and drive optimal performance.
Risk mitigation: Experienced outsourcing companies help finance teams identify and address potential challenges early, reducing the likelihood of costly delays or errors.
CFOs in the survey highlighted operating efficiency as a primary goal of outsourcing, with many recognizing it as a smart way to reduce costs, gain access to skilled labor and achieve efficiencies that in-house operations cannot match. The survey also showed that finance areas with the highest return on investment (ROI) when outsourced include management reporting and analysis, billing, accounts receivable and capital budgeting.
Finance areas with the highest ROI when outsourced
Procurement, particularly maintenance, repair and operations (MRO), offers a significant opportunity for savings that outsourcing companies can help uncover. Additionally, improving metrics like days sales outstanding (DSO) in order-to-cash processes can deliver meaningful returns.
Despite the benefits, there are barriers to outsourcing adoption. CFOs identified pricing model issues, antiquated technology, and cultural resistance as significant obstacles. Other challenges include misalignment of objectives, contractual issues, inadequate governance frameworks and talent concerns.
Moving past outsourcing barriers
To overcome these barriers, companies should focus on aligning with outsourcing partners who bring both industry expertise and advanced technology. Successful outsourcing partnerships stem from thorough due diligence, ensuring that the outsourcing company’s capabilities and approach align with the company’s needs and objectives.
Focus areas for the future
Looking ahead, companies plan to focus their outsourcing efforts on predictive and prescriptive analytics, basic analytics, accounts receivable, and capital budgeting over the next three to five years. Strategic outsourcing in finance, accounting, and procurement can solve a mix of problems, provide valuable data insights, and offer a solid ROI, helping companies modernize operations, ensure compliance and improve everyday performance.
Finding the right outsourcing partner for finance operations can feel like a daunting puzzle. However, a collaborative approach—working closely with partners and clearly defining critical information needs—can streamline the process, helping companies quickly bring the pieces together and create a clear, cohesive path to success.
Organizations that concentrate solely on operational details at the expense of strategy can end up with isolated results that may fail to meaningfully impact business success. By prioritizing strategy over operational details, companies can achieve meaningful results that positively impact business success. To learn more about positioning your organization for ongoing financial success, visit Conduent’s Finance, Accounting and Procurement Solutions page.