Why some Australian accounting firms can’t make outsourcing work

David CarterOutsourcing

Why some Australian accounting firms can’t make outsourcing work

Last week we went through the history of Australian accounting outsourcing. Our CEO David Carter has led the Odyssey in outsourcing to over 1,000 Australian accounting firms over the past 15 years, and Odyssey has completed in excess of 250,000 Australian returns. So we feel we have enough depth and breadth to talk a bit about why some firms can’t make outsourcing work.

Firstly, we really like outsourcing. We now have some 250 professional staff who are completing some 35,000 jobs annually. They are well paid, have an excellent quality of life. Some are Australian educated. Some are Australian CPA’s. They prepare excellent quality work which allows Australian accounting firm owners to not only sleep better at night, but also to focus on other important things. High quality work makes Australian accounting firm clients happy, and keeps the ATO happy (and we all like to keep the ATO happy!)…

So why doesn’t it work for some Australian accounting firms.

Last week our blog when through the history of Australian accounting outsourcing over the past 15-20 years, and arguably there was a fair call back in the “good old days” that the outsourcing providers were in an immature market, and a lot of the first adopters from Australia probably remember these days as the “bad old days” for ominous reasons.

However, if you are dealing with offshore outsourcing providers that have been around for over 15 years, then you have the right to expect a high quality service, a high quality offering, and a high quality experience.

As we mentioned last week, a good due diligence will sort out providers that won’t be able to make the cut, and going cheap is always going to mean someone somewhere has cut some corners.

So assuming you’ve selected a high quality provider, why then can’t some firms make it work.

Our top 5 reasons:

  • Not everyone has bought into the outsourcing process, and there is resistance from some of the participants. This resistance sometimes manifests itself in sabotage.
  • There are unrealistic expectations on the quality of the output, which when linked with garbage input, makes the outsourcing provider doomed to fail
  • There are issues in the firm with either legacy systems, legacy software (i.e. not cloud), legacy staff (resistance to change), legacy owners (who just want to sell), or legacy clients (the shoe-box brigade)
  • There is an expectation that quality, price and time can all work in the direction that the accounting firm wants. Massive quality, in a very short time, for a very small price. The reality is that you should be pushing for high quality, in a reasonable time-frame, with not so much of a focus on price. If you squeeze price, then you’ll find not only a drop in quality or time, but there are likely to be shortcuts being taken, which usually come back to bite you in the end. One example is engaging remote staff who work from home, which while saving office rental costs, opens you up to massive security risks .. and yes, we’ve all heard the excuse that their quality of life will be improved if they don’t have to travel 3 hours to get to work – try telling that to the client when their TFN goes walkabout!!
  • It was tried previously, but just seemed too hard to incorporate into current systems. It worked ok, but the firm wasn’t ready to make changes to include the outsourcing process into the firm.

After almost 20 years in providing Australian compliance outsourcing services, we’re confident this is a sustainable market, with benefits for all participants. If you’re not sure on outsourcing drop us a line and we can have a chat.