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When to Outsource or Why Outsource at All?

As a financial leader of your organization, it’s important that you understand how your time works and what you are spending your time on. In today’s blog, we’re taking a look at when to outsource accounting or specific tasks and services and why outsource at all. Before we go into when, first, let’s understand, what is outsourcing? Many of you have heard the term, but don’t really know what it means.

Outsourcing is simply delegating and paying someone outside of your organization to do a service for you that you cannot do or do not have time to do.

Examining Your Daily Routines

For example, think about your daily routines. Think about what you currently do. The list may add up quickly if you’re like me and wear many hats.

Put a star next to the things that you struggle to find time to do in the first place.

In your personal lives, it could be mowing the lawn or changing your car’s oil or cooking yourself.

For example, I find myself as a business owner operating a franchise struggling to find time to really prep and cook dinner each night. So what we do often is go out and pick up food – essentially paying someone to cook our food for us. We could either dine there or take it home.

Time Value

It’s all about time value. Are you spending your time on what you or your company values most?

When examining your daily routines, do you catch yourself saying “I don’t have time…”?

“I don’t have time to mow the lawn.”

“There’s no time to clean my house.”

“I don’t have time to close the books because I’m out there running my business.”

Whatever those time consuming tasks are, it may be worth outsourcing to another person or agency. 

By freeing up your time as a CFO, you can reallocate that time to more important tasks – such as being your CEO’s trusted advisor. Learn how to become the trusted advisor your CEO needs.

When to Outsource Accounting

For example, you might have to hire a bookkeeper in your organization for them to come out and enter the transactions on a daily basis. For me, that’s important to outsource because I need to be thinking at a higher level as a Controller/CFO – not entering transactions. There will always be someone less expensive to do that. 

So really when we say we don’t have time, it is because of one of several reasons. We don’t want to spend our time on something else if someone else can do it for cheaper (and if it energizes them more). Plus, it may be time to start outsourcing accounting when you want to:

  • Make more money for you
  • Bring you more value
  • Do what you enjoy doing more

For example, entering transactions for month close is dry work and it wears on me. But I love coaching leaders how to be more effective in their roles and make their decisions more impactful. If I’m bombarded with transactions, I cannot coach leaders – which is more valuable to me and the bottom line.

On a personal note, when I do not have to cook dinner, I have an opportunity to spend more time with my kids. It also frees up my time to help my kids with homework and build memories with them. I can also read a book for personal growth or enjoyment. There’s so many opportunities out there for you to actually do things that you actually enjoy. 

Outsourcing accounting is just one area where you may add value to your company. Continue to do things that add value or free up your time so that you may add value. Click here to download our guide on how to be a trusted advisor to your CEO to help them improve your company’s value.

When to Outsource, When to Outsource Accounting, Why Outsource

Why Outsource At All

One of the top reasons why companies outsource at all is that they may be more efficient. When I outsource, I am hiring someone that might be more knowledgeable. If I am a business owner who does not know how to record certain transactions, then consider the time it will take to learn that skill (and the time you are not spending on improving profits and cash flow). Even if you wanted to implement Quickbooks so that you can start recording transactions (a one-time set up), it may be worth handing that off to someone more knowledgeable in Quickbooks so that you can focus on other things you are more knowledgeable in. 

Those are things you consider when to start outsourcing.

The goal is to create more time, more energy, and free you up to do something that can potentially make you more money.

Examples When Considering Outsourcing

To further explain the need to outsource, it’s important to consider roles outside of the accounting and finance departments.

If you are a good sales person for your organization, then you don’t want to spend your time behind a desk all day trying to enter your transactions. If you don’t have a lot of transactions, then that’s a perfect sign that you need to get out there and start making those sales for increased transactions for your business to actually record.

Outsourcing is a Key to Growing

I think that outsourcing is a key to growing. It is no different from a leader wanting to delegate the tasks that…

  • You just don’t have any time to do
  • You need others to do so that you can focus on what you are great at doing from a very high level

Now, at The Strategic CFO, we have several ways for you to tap into or start outsourcing individuals so that you can actually build on your business.

Consulting

We have accounting managers, controllers, and CFOs that are ready to deploy and add real value where it’s not currently being optimized. In our consulting practice, we work in several capacities, whether it be an Interim CFO role, financial and operational reporting, mergers and acquisitions, pre-audit preparation, etc. Click here to learn more about our consulting practice.

For example, your accounting manager, controller, or CFO may

  • Not exist yet (brand new hire)
  • Be on maternity leave
  • Take 3 months off to travel through Europe (I wish!)
  • Need extra help because your company is going through an audit for the very first time

Life happens regardless of what you plan for. That’s why we’re here to step in when you need it. We will come in and help you with getting the helping hand you need to be more efficient with your current team. Need hiring and training? We do that too. These are all different reasons why you may need to outsource. We are here as a boutique firm to help you.

When to Outsource, When to Outsource Accounting, Why Outsource

Coaching Workshops

There are also opportunities for you to come in and take workshops at our office, in an online setting, or at your office. For example, you can learn about what your leadership style is. Are you a Type A person that can’t just let go of doing the little tasks? By learning about yourself, you start to outsource or delegate what you are not strong at and focus on what you are great at. As a result, you can continue to grow the business.

We offer a variety of workshops to…

Your CEO needs an advisor they can trust. Learn what they expect from their CFO and how to become the trusted advisor your CEO needs in this whitepaper.

When to Outsource, When to Outsource Accounting, Why Outsource

When to Outsource, When to Outsource Accounting, Why Outsource

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Outsource Definition

See Also:
Administration Expenses

Outsource Definition

The outsource definition is the practice of transferring business activities to an external organization instead of performing the activities internally.

Outsourcing Criteria

Companies may outsource business activities if they feel an external organization can perform the activities better or at a lower cast than if the company were to perform the activities itself. Outsourcing typically involves a contract between the company and the external organization that stipulates the costs, quality standards, and other conditions regarding the performance of the business activity.


Click here to download: The Guide to Outsourcing Your Bookkeeping & Accounting for SMBs


Insourcing

The decision to outsource instead of insource depends on the nature of the business. Typically, companies want to focus on their core business activities and outsource peripheral activities. Value chain analysis may help a company discover which activities to perform internally and which to consider outsourcing.

Activities that are commonly outsourced include bookkeeping, legal services, transportation, security, and other business activities. When deciding whether to outsource an activity or perform the activity internally, it is necessary to consider the advantages and disadvantages of outsourcing.

Outsourcing vs Insourcing

It may be advantageous to outsource an activity if doing so is cheaper than performing the activity internally. It may also be useful if the external organization has superior expertise in the activity. Outsourcing also allows a company to focus its attention on its core business activities.

There are also disadvantages to outsourcing. Outsourcing customer service operations may cause customers to feel disaffected when they find out they are not dealing with the company they are trying to reach. Also, if the external organization has access to sensitive information, then there may be a risk of information leaking to competitors or other parties. Outsourcing certain operational activities may cause the company to give up valuable customer data used for marketing purposes. And finally, outsourcing may require the company to incur the costs of monitoring and auditing the performance of the external organization.

Outsourcing Overseas

In today’s global economy, more and more companies are outsourcing business activities to external operations in other countries. Labor and operational costs may be significantly lower than in the company’s home country.

Guide to Outsourcing Your Business's Bookkeeping and Accounting


Before you decide to outsource, determine what your core competencies are. Check out our free Internal Analysis whitepaper to assist your leadership decisions and create the roadmap for your company’s success!

Outsource Definition
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Outsource Definition

Originally posted by Jim Wilkinson on July 24, 2013. 

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PEO or Outsource Payroll

See Also:
Advantages of a PEO
What is a PEO?
How to Select a PEO
Professional Employer Organizations FAQ’s
Service Department Costs

PEO or Outsource Payroll

Do you have a PEO or outsource payroll? Under the PEO Arrangement, there is a co-employment relationship in which both the PEO and the Business Owner have an employment relationship with the employees. Contractually, the PEO and the Business Owner allocate and share many of the traditional employer responsibilities and liabilities. For example, the PEO assumes responsibilities and liability for employment related matters such as Payroll and Payroll Taxes, Employee Benefits, Human Resources Management, and Safety and Risk Management. As a result, the Business Owner can concentrate 100% on growing their Business.


Click here to download: The Guide to Outsourcing Your Bookkeeping & Accounting for SMBs


Outsourcing is a contractual arrangement, absent an employment relationship, with a vendor (and its supervised personnel), for services, either on the customer’s premises or off-site at the vendor’s location, to perform a function or run a department that was previously staffed and supervised by the customer directly. Furthermore, examples include: Payroll Processing, Financial Auditing, Agent of Record Services, and Legal Services.

Today’s Professional Employer Organization (PEO) is a “hybrid” of all of the honorable characteristics of the Staff Leasing Business Model. In addition, combine it with all of the efficiencies of the Outsourcing Business Model.

Guide to Outsourcing Your Business's Bookkeeping and Accounting


If you’re interested in becoming the trusted advisor your CEO needs, then download your free How to be a Wingman guide here.

PEO or Outsource Payroll

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PEO or Outsource Payroll

Originally posted by Jim Wilkinson on July 24, 2013. 

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Productivity of an Accounting Department

Most people (especially those outside the finance side of the business) see the financial function as a cost center. Although an accounting department does not generate any revenue, it has the potential to dramatically improve profitability. Think about this: you should be able to convert 1-2% of sales into profits if the department was more productive. The productivity of an accounting department is directly linked to the improvement of profits and cash flow – the bread and butter of financial leaders.

How Productive Is Your Accounting Department?

Before you attempt to improve the productivity of an accounting department, assess how productive or unproductive it is currently. First, log what is working and what is not working. By going through this process, you will allow yourself or the financial leader of your company to fully evaluate what is going on. There are a couple areas that you can start considering when asking the question: how productive is your accounting department?

If you find that your accounting department is productive, brainstorm ways to make it more productive. The great thing is that there is always room for improvement.

Track your accounting department’s productivity by using KPIs. For help, download the KPI Discovery Cheatsheet!

productivity of an accounting departmentTips to Improve Productivity of Accounting Department

While there may be a million little things that you can do to push the needle a little, we have found that there are a few focus areas that allow you to take the biggest strides ahead. When improving the productivity of an accounting department, start by using best practices, training and developing your team, automating as much as possible, communicating effectively, tracking progress, and outsourcing. Finally, walk through your accounting department to ensure maximum profitability.


Click here to download: The Smart Back Office for SMBs


Use Best Practices

The best way to accomplish this first tip is to continually read up on, research, discuss, learn from thought leaders, and attend events to catalog the best practices used by others to attain a productive accounting department. In addition, if you keep ahead on implementing the best practices, you should be able to accomplish company goals quicker. According to GAAP, some best practices include regularity, consistency, continuity, and recording sales when they are certain.

Training & Development

Unfortunately, some employees are simply not going to do the dirty work of reading up on the best practices. They are leaving that up to you ­– the financial leader. Those employees are going to continue to do exactly what they have done in the past; and therefore, reduce the chances of being more productive. So, it is up to the financial leader to provide training and development for the team. If the team hears and learns the same training and development sessions, then there is a huge opportunity to create a more synergized accounting process.

In his book The 7 Habits of Highly Effective People, Steven Covey says that synergy “is the habit of creative cooperation. It is teamwork, open-mindedness, and the adventure of finding new solutions to old problems. But it doesn’t just happen on its own. It’s a process, and through that process, people bring all their personal experience and expertise to the table. Together, they can produce far better results than they could individually. Synergy lets us discover jointly things we are much less likely to discover by ourselves.” The more your team is on the same page, the more productive your accounting department.

Automate

One of the great things about technology is that you can automate almost everything. While that could be bad news for those of you whose jobs could be automated, it is great for the productivity of an accounting department. Rather than laying off those employees, strategize how you can transition those people into more value-adding roles.

Communicate with Team

There’s a joke that you can tell extroverted accountants from introverted accountants by whose shoes they look at – their own or the other person’s. All jokes aside, it is critical that the financial leader get themselves and their team out of their office to communicate. During the hour or so when you take lunch or get coffee, ask one of your team members to join you. In addition to getting to know them better, see if they have any ideas about how to make the department more productive.

Identify Skills of Team

Part of communicating with your team includes identifying the skills of your team. Understand what talents they may have that was not on their resume. Assign projects to them in areas that they excel. Ask questions like: What’s the first thing that you like to do at the beginning of the day? Or if there is something that you could do all day, every day, what would that task be? When you identify the skills, talents, likes, and dislikes, you will be able to further develop your team.

Have KPIs

Identify those key performance indicators (KPIs) that indicate the productivity of an accounting department. Once you have identified them, use and track them. If you find your department sliding backwards, reassess and start the process over again.

If you are struggling to identify and track the KPIs that indicate the productivity of your accounting department, click here to access your free KPI Discovery Cheatsheet!

Outsource

If a specific job or task is not a core function of the business, explore whether it can be outsourced. For example in our retained search business, we have discovered that many companies are outsourcing their accounting departments to countries like the Philippines and Germany because it is more cost-effective for their organization. While that decision may be outside the norm, it is an opportunity to step up and be a financial leader. Outsource tasks and roles that can be accomplished at the same quality for a lower cost.


Click here to download: The Smart Back Office for SMBs


productivity of an accounting departmentWalk-Through Process

Finally, generate a list of topics to run through when evaluating the productivity of an accounting department. The Journal of Accountancy developed a questionnaire as part of a walk-through process checklist that can be accessed online (we have also included it below). When you ask yourself these questions, you’ll be able to better gauge the productivity of your accounting department and exactly where you need to focus.

Time

  • How much time are you spending on any given task?
  • Is it labor intensive?
  • How many people participate in the process?
  • Does it take excessive time to complete?
  • Is there a duplication of effort?
  • Are too many handoffs occurring?
  • Are roles and responsibilities clearly defined?
  • Is anyone performing similar tasks?
  • Are roles and responsibilities appropriate?
  • What is slowing down the process?
  • Do you require needless reviews or approvals?
  • What are the busiest times of the day, week, month and/or quarter?

If there is a task or job that is time intensive, judge if that job could be automated, outsourced, or done quicker. The goal is to reduce the cost associated with that task or job. Unfortunately, you are going to find that there are jobs that simply cannot be trimmed as they are essential to the business itself. That’s okay! But try to find and reduce the costs associated for as many tasks as possible.

Necessity

  • Is the step or process necessary to the company’s success?
  • Can you eliminate it without causing any damage?
  • Do you have more tasks to do because of a single task?
  • Is duplication of information necessary?

Automation

  • Can you automate a task?
  • Are you keying in the same data into multiple places? (For example, the accounting system, an Access database, spreadsheets, etc.)
  • Does a backlog exist?
  • How often are your deadlines missed?
  • Where is there a breakdown of a streamlined process?
  • Is there a person or a job that stops the production of financials?

Value Adding

  • Does a task add value?
  • How accurate is the data?
  • How much value can come from automating/outsourcing/etc.?

Conclusion

Streamline your accounting department by asking questions, automating, outsourcing, and find more profits and cash flow. Don’t continue to just be a cost center… Transform your department into a value-adding entity within the company! For help and tips to track your transformation, you need something to measure your performance. For help, download our KPI Discovery Cheatsheet and start measuring your accounting department’s KPIs today.

Productivity of an Accounting Department

Productivity of an Accounting Department

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The Red Flags of Fraud

Businesses lose millions (if not billions) of dollars due to fraud. But how do so many cases of fraud go unnoticed until the damage is done?  Often, it’s because businesses don’t recognize the red flags of fraud soon enough.

Working with many entrepreneurs and their companies for the past 25+ years, I have unfortunately have come across numerous instances of fraud in companies.  The harsh reality I’ve discovered is that if an employee wants to commit fraud, they can do it.  It’s just a matter of how easy you make it for them.

If you suspect there may be fraud in your company, start by confirming that your unit economics are in line with expectations. Download the free Know Your Economics guide to break down what’s going on in your business.

Red Flags of Employee Fraud

One of the most noticeable warning signs of fraud is employee behavior.  Do they act controlling or feel the need to over-compensate their role?  If your employee needs to have sole responsibility, or if he or she needs to have the final say in a decision, it’s probably a good idea to monitor that employee’s activity to determine the reason for their behavior.

Here are some other behavioral signs of fraud to look for:

Refusal to take mandatory vacation or sick leave

Coworkers and managers love an employee who never takes a vacation and works hard.  Many of us wouldn’t question this behavior because it’s getting us faster results.  Sometimes, what looks like hard work is actually an employee covering their tracks.  Employees, particularly those working in a position where fraud is more likely, should be required to take time off.  This not only short-circuits fraudulent activity, but it ensures that employees are cross-trained.

Employee lifestyle changes (new house, expensive jewelry, cars or home)

According to a 2014 Global Fraud Study, 43.8% of occupational fraudsters live beyond their means. Does your employee have a better house than you? What about his or her car? Here’s my general rule of thumb: if your employee has nicer belongings than you, that’s a red flag. It’s time to check your books.

One time, I recommended to one of my clients that she should outsource her payroll to an external payroll service. I usually recommend this because it’s easier and less-prone to fraud. Rather, my client declined this suggestion and claimed that she could do payroll better than a service.

This client always dressed nicely, to the T. She’d walk in with a kind of confidence and drove a nice car (nicer than her boss!). Everyone saw her as a nice person, because she offered to stay back and let the cashiers go home.

Seems like the perfect employee, right?

Actually, it turns out that she had been cashing checks to herself by voiding cash transactions and pocketing the cash. See what I mean? If your employee has nicer belongings than you, that’s a red flag. It’s time to check your books.

Significant personal debt and/or credit problems

Ideally, a company should perform background and credit checks before hiring. However, some companies just don’t want to go through the paperwork.

For example, one client I had never made copies of their original checks. When I did my audit, I found half a dozen missing checks. The controller had been running the checks for his own personal use.

One day, the controller went to lunch and never came back. After running a background check, we found out that he was convicted of embezzlement five years prior.

Borrowing money or requests for pay advances

In the same study, 33% of occupational fraudsters have financial struggles or difficulties. When a fraudulent employee steals or “borrows” money, oftentimes he or she will rationalize. “It’s okay, I’ll just pay them back later.”

For instance, let’s say someone is in charge of a company credit card and uses the company credit card on accident. When she gets to work the next day, it’s written off. No one questions the personal expense. So then a pattern begins – an accumulated rationalization that she will “pay it back later.”

Easily annoyed at reasonable questions

If an employee snaps because of an obvious or reasonable question, he or she is likely suffering from guilt or preventing the questioning from going further into detail. If this ever happens, keep asking questions. You’re bound to get the answer you’re looking for (even if you don’t like it).

There are many other signs or “red flags” that you should be aware of. However, controlling behavior doesn’t always reflect fraudulent employees. Basically, all you need to know is: be careful who you trust, be aware of your employees’ behaviors, and know your economics.

Where are the red flags in your financials? Calculate your unit economics with our free guide!

How to Prevent Fraud

Outsource your Payroll

Payroll processing is a hot area for fraud to occur.  Because of this, I recommend payroll to outsourced companies because it’s easier to prevent fraud. Instead of keeping track of multiple employees’ checks, you only have to write one. The person writing the checks (you) is not the same person running the transaction.

Know your Economics

If you are regularly checking to see that your unit economics are in line with expectations, it’s more difficult for fraudulent activity to go unnoticed.  Anomalies will come to light and be investigated and resolved sooner.  Creating an environment where business performance is closely monitored discourages fraudsters much like an alarm system on your house discourages burglars.  If you perform a consistent audit within your company, you’re less prone to fraudulent activity.

Perform Background and Credit Checks

Save yourself the heartache of dealing with fraud in your company and invest in a regular background check process. You never really “know” your new employees until you’ve worked with them for a couple of years, but at least you’ll have their “red flag” behavior in writing.

Conclusion

In conclusion, security is not only an issue externally. Here are a few key points to take with you: If your employee in a position of trust has a nicer car than you and nicer clothes, check your books. Stay aware of your employees’ behavior. Be prepared – do background and credit checks on your new hires. And finally, don’t wait until a crisis to know your economics. Want to create an environment that discourages fraud?  Keep track of your company’s economics with our free guide and start taking a closer look at what’s going on in your business.

red flags of fraud

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red flags of fraud

 

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Outsourced Workers: Do You Need More Hats or More People?

Outsourcing is something that has always existed, but has seemed to become the “norm” for most companies. outsourced workersRightly so, outsourced workers are an easy solution for financial leaders to mitigate costs.

The big question we’re asking is: Do You Need More Hats or More People?

If you’re looking at outsourcing, the first step is to complete an internal analysis to study your strengths and weaknesses. Need guidance in conducting an internal analysis? Download the free Internal Analysis Worksheet now. 

This is our third and final blog of our “are you wearing too many hats?” blog series. Initially, we started with the concept of having “too many hats“… meaning you as a financial leader have been given additional roles that go outside of what you thought you signed up for.

In our last blog, we discussed how millennials transition our CFO roles from traditional “CFO hats” using more innovative tactics. We also analyzed how technology may be able to help you complete the unfinished tasks in your company.

CFOs are currently struggling because of their many hats. What do you do when the weight of responsibility is too much?

Our Answer is Delegation

I recently moderated a Q & A panel of three CFOs, and heard very different answers from all three when discussing how to handle their “too many hats.” An interesting response was delegation, and handling too many tasks. How do you delegate these tasks, and who do you delegate them to?

One solution is outsourcing.

How Technology Connects You to Outsourced Workers

As discussed in our last blog, technology impacts a company by relieving some of the responsibilities on individuals.  Routine tasks can often be performed by computers, freeing up workers to spend their time on more value-added tasks.

Due to cloud computing and improved applications, outsourcing your work is a lot easier and cheaper. 

How Much Does Outsourcing Save You?

I know what you’re thinking… “Why don’t we just polish what we’re lacking on and allocate our budget to that?”

Some projects are more costly than others. For perspective, let’s say you were starting a new company and needed to design the website. The costs of hiring programmers and engineers in house would be tens, maybe hundreds of thousands of dollars. Compare this to a few thousand you can pay to workers outside of your company.

When starting your own company, you should also consider outsourcing projects that you are unfamiliar with. Although it is important to learn all aspects of a company, you don’t need to do it all at once. Having outsourced workers saves you money and time and provides expertise that you may currently lack.

In my own company, we outsource a lot of projects nationally and internationally (particularly with the one-time deals). We even outsource the projects to other companies, not just freelanced workers. Because our current staff is not as familiar with graphic design, we hire freelancers to do our designs and white-papers. We come up with the content, however, which reflects how employees provide the value-added information in a company.

What Should You Outsource?

We want to make sure that the tasks we delegate are the tasks that don’t necessarily make us money. What does that mean? Here are a few that we recommend you consider outsourcing:

A better question would be, what can you not outsource?


Click here to download: The Guide to Outsourcing Your Bookkeeping & Accounting for SMBs


The Risks of Outsourcing

Although outsourcing is a great solution to get rid of some of your hats, you may want to be wary of what you assign…

Value-Added versus Non-Value-Added Tasks

Often, we have to decide which tasks are more important than others. Even within the office, you have to choose which tasks to hand off to other trusted employees, and which tasks you need to complete yourself.

Typically, you would choose the value-added tasks because you, as a financial leader, are meant to add value to the company. You don’t want to assign important tasks to freelancers or offshore outsourced employees, because (presumably) no one does it as well as you do. Which brings me to my next point…

Do you find yourself gradually outsourcing more tasks for your company, rather than handling them yourself? Download this free Internal Analysis white-paper to find out why.

Laziness to Learn

So you’ve got a good set of employees, as well as outsourced workers. The budget is comfortable and your company is running smoothly. No one wants to change a system if it’s working fine, right?

Wrong.

As a CFO or financial leader, you are meant to be the wingman to the CEO of your company. The company should always seek to grow and adapt to new systems and technologies the business world has to offer. Remember that outsourcing is only meant to take some weight off of your head, not take all of your hats away completely!

The point of outsourcing is to take hats off. If you find that you are outsourcing any of your core competencies, it’s time to conduct an internal analysis.

Cyber-Security Issues

Keep in mind, whoever you outsource your tasks to will need access to some of your company’s information such as passwords, financial account information, etc. There are often cyber-security issues that occur, putting hundreds or thousands of people’s information at risk.

When deciding what information to release to your outsourced parties, the first priority you should protect is the financial information – your company’s and your customer’s information. If you can, avoid giving third party companies access to any financial information. Most platforms allow you to create “moderator,” “contributor,” “editor,” or any other variation that is other than “administrator.”

Government Regulation

Outsourcing government-regulated tasks can be a little tricky, particularly with countries that do not have the same regulations. This issue is industry-specific. Some examples would be insurance, medical, and financial services.

Cultural Barriers

When you outsource to workers who have a language barrier, time difference, or just a generally different way of handling projects, it may be a bit more difficult to execute a task. Companies have to be cautious for the sake of time, because one cannot hand a project to an outsourced worker who needs training constantly.

This is where adaptation comes in… In our company, we freelance our graphics to outsourced workers in the Philippines. We have to prepare our instructions and content a week, sometimes two, in advance. Why? Because of the time difference and the resources available to our contracted worker. We want to make sure his needs are accommodated as well as our own, and we adapted to his way of doing business.

Conclusion of Having “Too Many Hats”

There are always risks in trying new things in your company – in adapting to new business systems and technologies. In this three-part series of “wearing too many hats as a CFO“, we explored solutions such as millennial tactics, technology, and outsourcing.

The drive of a millennial + experience of older generations = success in your company.

Adaptability is key – Technology is created to help you.

Outsourcing can lessen the number of “hats” you wear as a CFO.

Regardless of the functions that you decide to outsource, conducting an internal analysis will help confirm your core competencies and identify areas that could easily be outsourced. Download your free Internal Analysis worksheet to start developing and enhancing your strengths as well as start reducing and resolving your weaknesses.

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Should You Outsource Your C-Suite?

In last week’s issue of the Houston Business Journal, Molly Ryan reports on how businesses in Houston are looking to augment the leadership of their companies by outsourcing their C-suite executive positions.  Ryan interviewed several leaders and clients of Houston-area outsourced executives firms, myself included, to get their perspective on what is driving the trend and who the primary consumers of these services are.

Should You Outsource Your C-Suite?

One of the reasons for executive outsourcing is technology. Art Saxby, founder and principal of Chief Outsiders, explains, “Technology makes it so much easier to work remotely.” This allows outsourcing firms to work on multiple clients from one location. Additionally, improvements in technology are affecting company structure. “I think there is a structural change going on in companies,” says Martin Lindenberg of the Newport Board Group.  “Because of the rise of information technology and automation, companies are becoming flatter.  There isn’t a need for as many layers in management. The result is, they are becoming leaner. And it is more cost-effective to bring in an outsourced experienced executive.” We have also seen that computerized accounting practices have greatly contributed to our company’s growth.  The streamlining of day-to-day accounting has led to smaller accounting departments that don’t always need a full-time CFO.

Who Is Hiring Outsourced Executives

So who is hiring these part-time executives?  Outsourced executives are ideal in mid-sized companies. They need the executive’s expertise and leadership, but they can’t always afford to have them full-time.  Fortunately, Houston has many mid-sized, entrepreneurial businesses. Ryan interviewed Marshall Hoffman (owner of Steel Supply, LP) and me as part of his research on outsourced executives. Watch the following video from HBJ’s website of Hoffman discussing his decision to hire a part-time CFO:

The full article can be found here. If you want to learn more financial leadership skills, then download the free 7 Habits of Highly Effective CFOs.

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