Why are businesses outsourcing? Contrary to common outsourcing myths, the accounting outsourcing industry is booming.
Insignia Resources reported that the global accounting outsourcing industry is projected to hit $81.25 billion by 2030, growing at an 8.21% Compound Annual Growth Rate.
Outsourcing can be a great business growth strategy for accounting firms. It can increase cost and time savings, team productivity, and revenue generation. Global trends in outsourcing demonstrate that it also provides access to a more skilled talent market and flexible scalability.
Despite these obvious benefits, why are there still so many misconceptions about outsourcing? A lot of leaders still balk at the idea of it, worried it will hurt their firm’s reputation, lower the quality of their services and client satisfaction, and put their data at risk.
Don’t let common misconceptions hold you back from leveraging this beneficial business strategy. Opting out of outsourcing could leave 20% to 60% in cost savings alone according to Insignia Resources. But outsourcing services aren’t just great for reducing costs. They help firms stay agile, flexible, and even become scalable, regardless of size. It can benefit established companies as well as small and even startup businesses.
In this article, we’re going to debunk some of the most popular outsourcing myths and share outsourcing facts.
Outsourcing myths debunked
Myth 1: You lose control of your business
The truth: Outsourcing frees you to focus on core business functions.
One of the common myths of outsourcing is that you’ll lose control of your business. In reality, it helps you get closer to your company’s goals.
Outsourcing is essentially delegation. You hand off roles and tasks to an individual or a team working in a location different from you, often in countries with more affordable rates, like India or the Philippines. When you hire an outsourcing services provider, it doesn’t diminish your authority or control. It frees you to focus on oversight and decision-making instead of doing menial tasks.
You can always choose to keep core business functions within your in-house team instead of outsourcing them. Outsourcing non-core functions, like bookkeeping, means your in-house team can strategise on improving your services to boost client delivery and sales.
As long as your outsourced team is doing work that doesn’t influence business decisions or revenue-generating activity, you are not delegating control of your business.
When you outsource specific business tasks, you can ensure smooth operations by:
- Defining the exact scope of work that you outsource
- Specifying your goals and expectations
- Setting up feedback loops to solve problems and check in
- Training the team to do the work with an operations manual
Myth 2: Outsourcing leads to lower-quality service
The truth: You are hiring highly-skilled professionals to deliver quality service.
A popular remote outsourcing myth is that outsourcing compromises quality. Professional outsourcing service providers hire and train professionals with specialized skillsets. For example, TOA Global provides in-house training for their accountants, virtual assistants, auditors, and bookkeepers for US, Australia, and New Zealand standards. This ensures that TOA’s talent have the skills and knowledge to perform their jobs well.
The thing about the outsourcing industry is that most providers specialise in one area, like accounting or software development. They possess a deep knowledge of their field often undergo regular training to stay updated. Outsourced teams are also equipped with technology which increase their efficiency and work quality.
It all boils down to selecting a quality outsourcing company. Trustworthy ones ensure that the staff they provide are experts at what they do, communicate transparently, and have a good track record. Ensure that when you research outsourcing partners, make sure to check for their credentials, training, and reviews. Typically, the better their reputation, the better their staff.
Overall, outsourcing work to service providers like TOA Global can enhance the quality of your customers’ experience.
Myth 3: Outsourcing is a short-term solution
The truth: Outsourcing providers can be a long-term asset to your firm.
An outsourcing fact is that it can be a short-term solution. This works well for firms during peak seasons. Tax season in particular can get busy, and in-house staff often need more bandwidth. However, firms that don’t look into outsourcing as a long-term strategy are skimping out on benefits, especially if they want to scale.
Scaling a business often requires a scaling in operational costs. You will have to hire more full-time in-house staff and pay for more overhead costs like office space, internet, and equipment. A huge benefit of hiring an external team is that you can scale your capacity without these added costs. Over the long term, this improves your capacity and your cash flow.
Myth 4: Outsourcing creates security risks
The truth: High quality outsourcing partners can help you mitigate risks.
A popular outsourcing myth? That it puts businesses at higher risk of security breaches.
The outsourcing industry is built on reputation. Outsourcing companies want to build strong relationships with their clients. To do that, they prioritise high quality service and protecting your sensitive data. Any security breaches on their part would reflect badly on them.
When you research on potential outsourcing providers, your primary objective should be conducting due diligence through the following:
Review and evaluate privacy protection policies and security certifications.
Three widely recognised information security standards are ISO 27001, SOC 2, or PCI DSS.
Define clear security requirements.
Ensure that your provider adheres to compliance regulations.
Monitor regularly and set KPIs.
An integral part of data security is regular monitoring. This will increase the likelihood of catching unauthorised or suspicious activity. You can also create key performance indicators (KPIs) strictly for data security. You can use this as an additional benchmark to review your provider’s performance.
Have backup plans in place.
The right outsourcing partner will have robust and secure backup strategies to avoid permanent data loss.
Myth 5: Outsourcing contributes to local job losses
The truth: Outsourcing companies can help you create jobs.
Because outsourcing can be leveraged as a long-term scaling strategy, it can help you create more jobs. Think about it: you delegate non-core business functions so that you free up your in-house team’s bandwidth. This also creates space employment opportunities. Now, you can hire strategic, full-time talent to help you focus on your business’ core competencies. The result is a growing internal team.
Outsourcing work also requires oversight. This can also contribute to additional job creation within your local team. For example, you’ll need more in-house managers to review service quality and coordinate with your outsourced teams. Both your internal and external teams win when you outsource.
Discover how outsourcing really works and how it can transform your firm.
This guide exposes the biggest misconceptions holding firms back and shows you what outsourcing looks like when done right: more capacity, less burnout, and stronger service delivery.
What does successful outsourcing look like for accounting firms?
Firms that leverage outsourcing successfully delegate an array of business functions. These can include a range of administrative tasks, accounting tasks, payroll processing, bookkeeping, and even IT services. Delegating these tasks makes them more efficient and thus more productive. In the long run, these firms gain a competitive advantage in a saturated and volatile market.
Firms with successful outsourcing do these:
- Set goals and expectations with their outsourcing provider
- Have clear communication channels and regular feedback loops
- Provide support and guidance through extensive training for their outsourcing partner
- Align with their service provider on compliance
Accounting firms opt to outsource because it can help them focus on core business functions, increase capacity, and compete at a global scale all while cutting costs. They gain better control of their business without burning out.
How to start investing in outsourcing today
With these popular remote outsourcing myths debunked, you now may be wondering: “How do I get started?”
Step 1: Research on a third party service provider
Start with looking for a reputable and highly-skilled services provider. TOA Global staffs over 1200 firms based in the US, Australia, and New Zealand with accountants, bookkeepers, auditors, and executive assistants with specialised skills and proven expertise specific to their standards. In a matter of weeks, our clients increase their capacity, boost their productivity, and enhance customer experiences.
Step 2: Assess what your firm needs
Next, identify your needs. What kind of tasks do you need to delegate to an outsourced team? What kind of tasks can you free your in-house team from? It can be accounting, bookkeeping, payroll, administrative tasks, IT tasks, or even marketing. Then, find an outsourcing provider who specialises in these areas.
Step 3: Set clear expectations
Step 4: Monitor and evaluate
Use your regular check-ins to gauge how well your outsourcing partner performs their tasks against set KPIs or benchmarks. These will ensure that you are both on the same page, can keep operating smoothly, and address any challenges in a timely manner.
The right outsourcing partner will align with you on your goals and needs, collaborate with you to achieve those, and consistently communicate with you to improve their services. If you’d like to partner with TOA Global to help your firm leverage outsourcing services, reach out to us.
Outsourcing: Your ultimate firm growth accelerator
Many accounting firm owners still believe myths about outsourcing and offshoring —myths that hold their practice back. In reality, offshoring isn’t about cutting corners or losing control, it’s about accessing a deeper talent pool, strengthening your team, enabling sustainable growth without overburdening your local staff.
With the right outsourcing partner, you gain support that aligns with your firm’s goals, collaborates closely with your team, and communicates consistently to ensure performance and continual improvement. If you’re curious how TOA Global can help your firm leverage outsourced accountants effectively, please reach out to us. We’re more than happy to get on a no-obligation strategy call with you.
