Why You Should Consider FP&A Outsourcing

A 2020 PwC survey of FP&A leaders offered two stark conclusions for FP&A functions:

  1. Managing the growing amount and sources of data is an increasingly difficult task.
  2. Staffing and time-efficiency of employees is subsequently becoming a more significant problem.

Why are these challenges arising? More importantly, once identified, how can you solve them?

Challenges of running FP&A internally

There were five key reasons highlighted that are causing these issues:

  • Increasing time needed to complete budget/forecast.
  • Outdated/limited technology means data takes longer to source and process. (Nearly 60% download FP&A data to spreadsheets, requiring manual data manipulation to generate insights)
  • Connecting varying data points is becoming more complex. This is due to the greater variety of sources.
  • Understanding/interpreting trends is becoming more difficult. This is caused by the sheer volume of disconnected data.
  • The increased difficulty of product/service line profitability analysis.

A stark statistic is that over 80% of data is gathered from offline databases and spreadsheets for some activities. This is not a good use of your FP&A functions time.

Risks to FP&A staff resource 

All this means your FP&A function staff are not able to perform optimally to deliver for your business needs. Too much time will be spent on repetitive manual tasks.  That means not enough time driving business insights and supporting decision-making.

Given these factors, it is no surprise the survey revealed 48% of FP&A functions are underst
affed for the work they carry out. Even worse, staff development is worryingly neglected: almost two-thirds of FP&A employees don’t believe they have a clear path to progress in their careers. This means a risks a high turnover and loss of key employees.

Optimise Your FP&A Function Compared to Your Competitors 

The survey showed only 10% of organisations use managed financial services outsourcing.  This 10% use them for management reporting, periodic forecasting, and long-range forecasting. This is astonishing given the efficiency, optimisation and resourcing issues organisations face.

By doing so, you could instantly gain a significant advantage over most, if not all, of your competitors.

What is financial service outsourcing?

Outsourcing financial services involve using third parties to manage your finance and accounting tasks. These include bookkeeping, financial analysis, and managing accounts payable and accounts receivable.

Using a third party, you can modernise your finance function and output, skills, and capabilities. This means no substantial upfront investment in internal staff or infrastructure.

Advantages of Financial Outsourcing

Using outsourced FP&A allows you to easily:

  • Embrace the latest fintech: outsourced organisations will generally possess the latest finance software. This maintains their competitiveness and provides the best service.
  • Improve staff efficiency: By outsourcing complex, manual finance tasks, you free up your FP&A function.  This enables you to deliver your core business priorities.
  • Increase your operational resilience: you have the flexibility to increase or decrease your outsourced processes.  This allows you to react to changing markets, unexpected disruption, or unforeseen circumstances, such as the coronavirus pandemic.

Cost Benefits of Outsourced FP&A

Outsourced FP&A also provides cost efficiencies by lowering recruitment and infrastructure expenditure.

  • Remove talent acquisition and training costs: experienced outsourced financial services can start immediately.
  • Cheaper software pricing: benefit from top-of-the-line fintech from your outsourced team, without incurring the infrastructure cost yourself.
  • Lower operational costs: no need for rented real estate or utility bills for an outsourced team.

Let Akshar Business Consulting improve your FP&A 

Outsourcing your FP&A to us means you can:

  1. Focus on your areas of expertise.
  2. Improve your output by utilising our astute functional skills.

Find out how we can make your FP&A more effective and efficient.

This will help you understand how we can assist you in your unique business environment.  You will be to identify key areas for finance excellence.

Alternatively, please request a call back to discuss your financial planning needs.

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