Outsourcing – Odyssey Resources https://www.odyssey-resources.com We Outsource Australian Accounting, Tax, Bookkeeping Services Wed, 11 Sep 2019 08:31:04 +0000 en-GB hourly 1 https://wordpress.org/?v=5.2.3 Stop emailing me with offers of resources: I can code, and so can my staff https://www.odyssey-resources.com/2019/09/stop-emailing-me-with-offers-of-resources-i-can-code-and-so-can-my-staff/ Thu, 12 Sep 2019 06:45:37 +0000 https://www.odyssey-resources.com/?p=4236 I was looking through one of my social media feeds recently, and saw in the news feed a comment from a frustrated IT person, who was obviously receiving far too much email spam (like that never happens to anyone in real life right?), and somewhat frustratedly had jumped onto social media to indicate they could code and had no need ...

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I was looking through one of my social media feeds recently, and saw in the news feed a comment from a frustrated IT person, who was obviously receiving far too much email spam (like that never happens to anyone in real life right?), and somewhat frustratedly had jumped onto social media to indicate they could code and had no need of emails offering programming support.

I’m sure you can see where our blog is heading this week.

Yes, there is no doubt, that the principal of the business would have set up their business because they are good at what they set their business up in, but the reality is that shouldn’t be what they do. It’s been over 20 years since business owners have been told to work “On their business, and not in the business”.

Not only is the cost of the owner’s time something that needs to be considered, but what about the cost of the staff time. Compare this to an overseas resource.

Add to this, an outsourced offering is a full service offering, which means the piece of work comes back fully reviewed and fully completed.

And recall that a fully outsourced service offering also includes all the things owners forget. Such as scheduling, resource allocation, juggling resources. That’s just for employees and offshore labour hire firms.

What about the direct involvement of managers, required to train staff, and required to review the work performed.

What about staff turnover, be it employees or offshore labour. All that IP walks out the door to another competitor.

And the owner, I’m sure they should be doing something else than having their hands on the tools.

We accept there is something soothing about having your hands on the tools as a business owner, but it’s really a head in the sand approach to future proofing your business’

Odyssey has built a compliance business over 15 years that completes over 50,000 jobs. We can assure you our CEO does not work on compliance jobs.

If you’d like to talk about Odyssey can give you some breathing space to work ‘On your business” them drop us a line.

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Outsourcing: the importance of understanding where you work https://www.odyssey-resources.com/2019/09/outsourcing-the-importance-of-understanding-where-you-work/ Thu, 05 Sep 2019 06:45:34 +0000 https://www.odyssey-resources.com/?p=4227 While travelling around we recently spotted a sign nearby a water drinking source. At first glance the sign appears totally in order, both in the original language, and in the translated English. However, native English speakers would likely note that “All sorts of pollution is banned” does not quite resolve the problem. Indeed “All Sorts” is not fully exclusive or ...

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While travelling around we recently spotted a sign nearby a water drinking source.

At first glance the sign appears totally in order, both in the original language, and in the translated English.

However, native English speakers would likely note that “All sorts of pollution is banned” does not quite resolve the problem.

Indeed “All Sorts” is not fully exclusive or inclusive.

For instance, “We accept all sorts of payment options here”, would immediately lead most English speakers to assume that most (or the majority) of the payment options were available, but not all.

So excluding “all sorts of pollution” is not the same as excluding “all pollution”.

When it comes to outsourcing, we frequently see many companies offering a solution that looks great on the surface, but when you delve deeper you see a cultural and country mismatch.

And it’s likely that we can surmise that generally these options may work reasonably ok for a while, but at the end the instance of miscommunication due to cultural differences is large. And this is when the problems start to surface.

Certainly, if you are paying for a cheaper option than others, then you have the right to expect miscommunication. And if you are training your own (overseas) staff, then “yes” might actually mean “I haven’t got a clue, but I’ll do what you ask, even though I don’t understand what I’m doing”.

For more on how we’ve managed to solve these issues, drop us a line, and we’ll be happy to chat more about how 15 years in the Australian tax compliance Outsourcing services area has enabled us to emerge as the market leader in Australian tax compliance Outsourcing  to Australian accounting firms.

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Australian tax compliance outsourcing: The Odyssey Outsourcing model versus Offshoring to the Philippines https://www.odyssey-resources.com/2019/08/australian-tax-compliance-outsourcing-the-odyssey-outsourcing-model-versus-offshoring-to-the-philippines/ Thu, 29 Aug 2019 06:45:39 +0000 https://www.odyssey-resources.com/?p=4221 Odyssey Outsourcing specialists have been providing Australian Outsourced accounting, bookkeeping and tax services since 2006. As you’d expect, over the past 15 years we’ve seen a lot of water under the bridge. Mobile phones have arrived, the internet speeds and reliability have increased, and the cloud is now a part of many Australian accountants lives. The cloud affects not only ...

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Odyssey Outsourcing specialists have been providing Australian Outsourced accounting, bookkeeping and tax services since 2006.

As you’d expect, over the past 15 years we’ve seen a lot of water under the bridge. Mobile phones have arrived, the internet speeds and reliability have increased, and the cloud is now a part of many Australian accountants lives.

The cloud affects not only bookkeeping, accounting and taxation, but also affects Australian accounting firms clients. There are myriad of apps and add-ons, with over 1,000 apps and add-ons for some of the major Australian software houses. At the same time, Software as a Service (SAAS) has not only arrived, but is firmly entrenched in many Australian accounting firms.

So through the past 15 years we’ve continued to refine outsourcing model, systems and procedures, in order to give our customers the Odyssey quality service for which we are well known.

Our business model is proven and has allowed us to complete nearly 250,000 financial statements and tax returns for our Australian accounting firm customers.

So what do we offer that sets us apart from the others?

Odyssey’s Outsourcing model

  • Odyssey provides experienced staff from day one. First hour first job is productive
  • Odyssey has experienced competent staff do not require training or management. Management is provided onsite by Compliance experts with up to 15 years of experience. Staff do not need to come back to you for queries.
  • With the breadth of staff, jobs are allocated to the best person with the best experience in that job.
  • Systems have been developed to streamline work through the Odyssey office.
  • Quality is key to the completion of work.
  • Staff have thorough working knowledge of Australian tax law. Staff have access to managers when required to discuss issues, saving you communication time. Problems are solved immediately onsite.
  • Consistency of staff, with extremely low attrition rate. Staff are happy with job mixes, and can progress and be promoted at their own speed. Staff can move to different client jobs if they aren’t enjoying the work. Staff aren’t compelled to suffer groundhog day – the mindless preparation of the same work every month!
  • Odyssey’s model offer flexibility in resources. It’s a service on demand. Feel like taking a 6 week break over Christmas, or a 2 month break in Europe at the end of the tax year – go ahead, Odyssey charges nothing when you aren’t sending us work.
  • There is no commitment during off-peak times, or on-peak times. Send whatever you want whenever you want.
  • Senior accountants lead the teams, and senior managers review the work. This means quality job queries, and quality work returns.

Offshoring Model

  • Staff generally have no experience. They usually start with the knowledge of an Australian graduate and will require your constant supervision and training. It’s likely they’ll have a couple of years experience.
  • Staff require continual management with training and support just like a regular employee. Australia delights in implementing new tax laws continually, some retroactively.
  • Staff require training in Australian taxation systems, and the taxation regulations and rules are not inherently understandable. For instance, superannuation is a concept only really understood by an Australian.
  • High staff turnover, with an average employment period of 2 years
  • You have to commit to paying offshore staff even if you run out of work for them
  • Staff want to work during Dec / Jan when it is quietest for AU
  • No support team to help ensure the work is to standard
  • Costs are based on a 40 hour week – whether the staff are productive or not
  • Some support in hiring – but not in ongoing processes and when staff leave you have to go through the entire re-training process again!

Yes, the offshoring model is cheaper, but it’s the old quality versus quantity question.  DIFM (Do it For Me) versus DIY (Do it yourself).

Odyssey has proven over time that the investment in people, systems and procedures results in better quality work, happier staff, and a better service.

Contact us if you’d like to chat more about how Odyssey can assist with your compliance workload.

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Odyssey’s Australian tax outsourcing – 15 years, and the change continues https://www.odyssey-resources.com/2019/08/odysseys-australian-tax-outsourcing-15-years-and-the-change-continues/ Thu, 22 Aug 2019 06:45:15 +0000 https://www.odyssey-resources.com/?p=4214 As we come up to our 15th year in providing Australian tax, accounting and bookkeeping services to Australian clients, we thought we’d grab a photo of one of the awards nominations we had from back in 2007, when outsourcing was very new, and regarded as a business innovation. One thing is for sure, what is new and exciting one year, ...

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As we come up to our 15th year in providing Australian tax, accounting and bookkeeping services to Australian clients, we thought we’d grab a photo of one of the awards nominations we had from back in 2007, when outsourcing was very new, and regarded as a business innovation.

One thing is for sure, what is new and exciting one year, suddenly becomes de rigueur and more likely critical.

In order to compete, businesses must make use of resources and inputs as best they can. The trend continues whereby offshore labour is deployed in many business areas, and the internet facilitates and will continue to facilitate, digital processing offshore.

And it’s an exciting time. The opportunities not only for Australian accounting firms, but in so many other areas, are massive. We only seem limited by our imagination, and to some extent the regulatory bodies and governments. The breaking down of barriers, including trade barriers, creates opportunities and risks for every firm.

I don’t believe there would be an Australian accounting firm anywhere today that hasn’t had a discussion about outsourcing and sending work offshore.

These trends will continue.

And what was once new and exciting, will become standard and obligatory.

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Accounting firms: How to effectively Outsource your SMSF work https://www.odyssey-resources.com/2019/08/accounting-firms-how-to-effectively-outsource-your-smsf-work/ Thu, 15 Aug 2019 06:45:54 +0000 https://www.odyssey-resources.com/?p=4198 Need to know the who, what, when, where and why of outsourcing your compliance work. But first, here’s the maths behind the argument that full time SMSF compliance workers don’t work, either locally or foreign hired. Australian accounting firm owners know that tax returns arrive in individual jobs, and at the same time the resources needed to be hired to ...

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Need to know the who, what, when, where and why of outsourcing your compliance work.

But first, here’s the maths behind the argument that full time SMSF compliance workers don’t work, either locally or foreign hired.

Australian accounting firm owners know that tax returns arrive in individual jobs, and at the same time the resources needed to be hired to complete those jobs come in blocks of jobs.  It’s the old square peg in the round whole issue. And most of us conquered this somewhere in our early year.

So why are accounting firm owners still struggling with an old employment business model. Well, they frequently use the argument that a full time SMSF resource can complete 100 jobs per year, and that hiring a full time resource gives the accounting firm owner a warm and fuzzy feeling that they have capacity for 100 jobs a year.

There are several inherent problems with this thinking.

Firstly, it’s last century. There is a change in the business models, and there are a lot more freelancers in the world. These freelancers happily quote on a job by job basis. They’re competing in your space, and don’t have the fixed and other overheads that you are trying to squeeze into your margin.

Ad-hoc resources seem to be winning in most areas. There is argument that AirBnb, AirTasker, Uber and all the other temporary rental models make more sense than ownership. Rent what you want, when you want it, for a fraction of the cost of ownership.

So leave the risk that skilled staff will disappear (and take your IP, training, and clients) to someone else.

Secondly, hiring by staff means you will always have capacity issues. There is no nirvana. You either have a stressed out staff member trying to complete 120 jobs in the time usually required for 100 jobs, or you have a stressed out business owner trying to find 100 jobs for an employee who only has 50 or 60 jobs.

Thirdly, hiring a staff member means you are still thinking sequentially, or horizontally. Your clients want work returned in an timely manner, after they lodge it. Accountants have traditionally finessed this by scheduling clients when they want the work. It’s an inefficient model. At worst case, you already know that poor Mr Smith’s SMSF is the last one on the list. Come back in a year Mr Smith! It doesn’t make sense. And Mr Smith can research the internet as well as you can. He’ll be looking for a good turnaround time!

Instead, work with a company that has significant capacity, like Odyssey, to complete dozens of SMSF’s daily. Send over 100 jobs, they should be back in under 2 weeks (allowing for queries!).

Lastly, there is significant changes expected as the software houses fire up their AI, and automation in bank feeds etc. The reality is that the SMSF area is constantly changing, and a risk avoidance strategy is to ensure you aren’t left with an employee that isn’t skilled for the current market. You either try to continually train and upskill the employee, or accept that the employment business model is coming under pressure from new business models.

If you want to chat about how Odyssey can assist with your SMSF compliance then please drop us a line.

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Why the hourly partner recovery rate isn’t making any sense https://www.odyssey-resources.com/2019/08/why-the-hourly-partner-recovery-rate-isnt-making-any-sense/ Thu, 08 Aug 2019 06:45:50 +0000 https://www.odyssey-resources.com/?p=4204 I see a lot of coaches for Australian accounting business owners, and they’re comparing stats amongst firms with various partner levels and employee levels, and they invariably have some maths that leaves me scratching my head. For instance, take the total revenue and divide that by the number of chargeable partner hours per partner, in order to get an actual ...

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I see a lot of coaches for Australian accounting business owners, and they’re comparing stats amongst firms with various partner levels and employee levels, and they invariably have some maths that leaves me scratching my head.

For instance, take the total revenue and divide that by the number of chargeable partner hours per partner, in order to get an actual partner recovery rate.

We seem to be stuck in some old world thinking there.

In our opinion, the leap is missing from business owner to star. A star is a partner who has a business that runs itself, and needs no input from the partner. So total revenue divided by a partner with 0 chargeable hours, gives a formula that doesn’t compute.

To illustrate, the image from this weeks blog highlights where I think the missing link is, and it’s preventing many accounting firm owners from entering “Star” (or super star) level.

Let’s start with where most Australian accountants will work, the entry level. A few years ago the Big 8 affectionately called their new recruits flogs (though strangely this job title wasn’t brought up in the job interview process). But that’s pretty much what happened. Work extremely long hours, on incredibly mundane things, in the hope this will benefit your career. Back in the day staff with any clever ideas were sent down to the photocopy room to teach them humility, and to assist printing out hundreds of audit reports on the photocopier. I’m sure there are more relevant stories of time wasting in the modern firms!

After you’d done your time as a flog, you were either fast tracked to partner (a process involving 10 to 15 years), which involved a convoluted path through many many levels of job titles, senior 1/2/3. Bit of time wasting, and really just to keep you keen.

There’s a problem with this business model. And it doesn’t make sense in the gig economy

However, the biggest lie being sold to Australian accounting firm owners today is the continued need to hire new staff to grow revenue, whether these staff be onshore or offshore, thereby continuing the need to be involved in training, communication etc.

It’s our believe that the real stars of the accounting world are those Partners who have developed systems, procedures, policies, and a comprehensive outsourcing strategy, such that they don’t need to have 1 chargeable hour in any year.

And if we were being honest, we’re failing our clients, our staff, and the public, when we aren’t generating enough income and spare time, such that we can spend time with our family, and time to give back to the community in some way.

If you’d like to chat about how you can get to 0 chargeable hours, and become a super star, then drop Odyssey a line about how we can assist with your Australian compliance outsourcing workload.

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Issues to Consider in Backsourcing Services https://www.odyssey-resources.com/2019/08/issues-to-consider-in-backsourcing-services/ Thu, 01 Aug 2019 06:45:02 +0000 https://www.odyssey-resources.com/?p=4195 Earlier in this series, we discussed the options available to the client when an outsourcing project is done. Among those, transition the service back in-house poses as a challenge due to the lack of capacity and expertise of the in-house staff who may have not performed the service for quite a bit chunk of time. You should review and follow ...

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Earlier in this series, we discussed the options available to the client when an outsourcing project is done.

Among those, transition the service back in-house poses as a challenge due to the lack of capacity and expertise of the in-house staff who may have not performed the service for quite a bit chunk of time.

You should review and follow the checklist of issues related to the decision to bring back the previously outsourced services to the internal team.

  • How many processes are outsourced?
  • To what extent have there been procedural changes in the process during the period of outsourcing?
  • What are the physical resource requirements (such as office space, computers, manuals etc.)?
  • What are the software requirements (such as licences for all applicable software and subscriptions to the appropriate material)?
  • What staffing levels and skills are needed to perform the work?
  • What are the support requirements for staff (such as HR, training etc.)?
  • Are any external agreements required in order to bring the work in-house (that is, what suppliers to the OSP need to be contacted such that the supply continues directly in-house, for example, actuarial certificates, SMSF audits etc.)?

This post has marked an end to the Odyssey Outsourcing Practice Management Series which aims to provide a big picture as well as the comprehensive understanding of  the outsourcing of Australian accounting, taxation and bookkeeping compliance.

The complete toolkits can be found at CPA Australia Outsourcing Guide, lead author by Odyssey’s David Carter.

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Accounting business owners model is all wrong. Why hiring full time staff isn’t making sense in the using economy https://www.odyssey-resources.com/2019/07/accounting-business-owners-model-is-all-wrong-why-hiring-full-time-staff-isnt-making-sense-in-the-using-economy/ Thu, 25 Jul 2019 07:00:15 +0000 https://www.odyssey-resources.com/?p=4185 This week we’re looking at the full time employment model, which is the model most people are probably used to. You know, the one where you grow up, maybe go to uni (or take on a cadetship while you study), then graduate and get a job. And that job is a full time gig. 40 hours a week plus or ...

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This week we’re looking at the full time employment model, which is the model most people are probably used to. You know, the one where you grow up, maybe go to uni (or take on a cadetship while you study), then graduate and get a job. And that job is a full time gig. 40 hours a week plus or minus.

For smaller accounting firms, and just as applicable to bigger accounting firms, we see a disconnect between the SMSF work available and the SMSF resources available. Generally we find that SMSF staff are dedicated to preparing and completing SMSF work, just based on this being a specialty area.

And in this specialty area, let’s say the SMSF resource hired can complete 100 SMSF’s per year, or 120 per year. If the SMSF’s in the firm are below this, and I expect the average across Australian firms is more like 30 SMSF’s per accounting firm, then you either have 0 resources available, and have to arrange for another Australian firm to complete the work at wholesale rates of say $1,200, or you outsource the work overseas to a company like Odyssey for around $350 per fund.

If you do happen to have a full time resource for the 30 funds, then happy days, and the funds are done, but you are left with surplus SMSF capacity. So you either try and do SMSF’s for other firms, not at your retail $2,200 rate, but at the wholesale accounting firm to accounting firm $1,200 rate, otherwise you think of creative ways to reduce the wage (working part time), or assign other activities like BAS or bookkeeping. These are usually lower recovery hours.

In fact the above scenario affects every firm. And ever firm will attempt to have surplus resources to deal with demand. So if they have 430 funds, they’ll hire 5 staff. And either the fifth staff doesn’t work too hard, or the whole department of 5 staff won’t work too hard, which affects firm culture.

If you’ve seen many of the “user” models available, then you’d expect someone is going to come up with something clever to efficiently soak up the huge amount of surplus compliance resources in the Australian accounting world. And if you want to get ahead of the curve, then you should start to experience and experiment with “ad-hoc” on demand business models.

Odyssey provides ad-hoc Australian accounting and tax outsourced services to over 500 Australian accounting firms. Talk to us today if you’d like to see how the “ad-hoc” on demand business model might help your firm.

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Why micromanaging is wrecking your Australian accounting firm https://www.odyssey-resources.com/2019/07/why-micromanaging-is-wrecking-your-australian-accounting-firm/ Thu, 11 Jul 2019 06:45:46 +0000 https://www.odyssey-resources.com/?p=4147 This week we’re talking about micromanagement by Australian accounting firm owners.  We’ve all read the negatives associated with micromanagement, which is, for Australian accounting firms, one step removed from doing the work yourself. There are still plenty of Australian accounting firm owners who love nothing more than getting on the tools and getting out a tax return. And there’s plenty ...

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This week we’re talking about micromanagement by Australian accounting firm owners.  We’ve all read the negatives associated with micromanagement, which is, for Australian accounting firms, one step removed from doing the work yourself. There are still plenty of Australian accounting firm owners who love nothing more than getting on the tools and getting out a tax return.

And there’s plenty of excuses why accounting firm owners tell me they need to stay on the tools. It keeps their tax skills up to date, they stay in touch with the software, they stay in touch with their clients. The list goes on.

At the next level up, is the micromanager. This person is one step removed from the tools, but for all intents and purposes loves to sit over the shoulder of the person on the tools. They’re great at assigning jobs to people, and ready to step in to help as needed (you know, assisting with on the job training), and really operate the tools by remote control.

Micromanagers at this level generate resentment and unhappiness, reduce employee morale, stifle productivity, creativity, and ideas. The micromanaged employees suffer from poor decision making skills, a concern about making mistakes (and hence not learning decision making skills), uncertainty, and ultimately a lack of commitment.

At its worst, micromanagement is destructive.

And yet, this insidious need to hold onto the tax compliance work, has been given a breath of fresh air through the recent (last 5 years) discovery of low cost offshore labour. These labour offerings are a fraction of the cost in Australia, and allow the Australian accounting firm owners the ability to stay on the tools. The requirement to “train your offshore staff” also allows the accounting firm owner to jaunt over to lovely destinations like the Philippines, albeit on a “work related” trip.

I don’t doubt this appeals to many micromanaging accounting firm owners.

However, for those that can move themselves up to the next level, and let go of the work (both hands on and remotely), then the opportunity to Outsource to a firm that can complete the work to a high quality standard in a timely manner should be seriously examined.

And this is a tough ask. Many Australian accounting firm owners don’t have any idea what to do when they’ve sent a job over to Odyssey. “What do I do now?”.  It’s a bit like retirement. You’re no longer needed at the coal face, nor do you need to watch the workers at the coal face.

This is daunting, and it’s easier to want to get back on the tools.

Instead you should be strategizing (thinking!), looking at your firm’s service offerings and new offerings, talking to your clients (with current data), and maybe taking some time off to recharge the batteries.

Odyssey staff are trained as service professionals to deliver Quality work on time, while maintaining a high level of technical accuracy and at the Odyssey Outsourcing Total Quality standards.

If you need help with overcoming that desire to stay on the tools, then drop Odyssey a line and we’ll show you how Outsourcing your compliance work can assist with working on your goals.

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How to evaluate outcomes of using the Outsourcing Service Provider https://www.odyssey-resources.com/2019/06/how-to-evaluate-outcomes-of-using-the-outsourcing-service-provider/ Thu, 27 Jun 2019 06:45:04 +0000 https://www.odyssey-resources.com/?p=4139 Following the post-implementation review step, you should now evaluate the outcomes of the project to decide your next move in outsourcing. Whether the outsource agreement should be renewed, transferred or exited depends on how you identify the achieved outcomes. You should answer 4 questions below: What was the rate of productivity improvement? Did the transition meet expectations? Were staff time ...

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Following the post-implementation review step, you should now evaluate the outcomes of the project to decide your next move in outsourcing.

Whether the outsource agreement should be renewed, transferred or exited depends on how you identify the achieved outcomes.

You should answer 4 questions below:

  • What was the rate of productivity improvement?
  • Did the transition meet expectations?
  • Were staff time and direct costs as expected?
  • What would you do differently?

As mentioned, three types of decisions are normally made after this evaluation step is to renew, transfer, and exit the current outsourcing agreement.

On a regular basis, if you choose the exit option, it will be either seeking for another OSP or bringing the outsourced services back in-house, namely “back-sourcing”.

Back-sourcing can be very challenging as it requires the capacity and expertise of the in-house team, which is difficult to achieve once the services was previously outsourced.

Keep updated for the next checklist which helps your business tackle the issue when it opts to enter the “exit” door.

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