- Statistics on Global Outsourcing
- Statistics for the Outsourcing Sector for the Last 18 Months
- Target Audience
- The BPO as a Migration Strategy
- BPO Before and After Migration
- Conventional NetSuite Deployments
- Sublicensing for NetSuite
- Offering the Best of Both Worlds-NetSuite and BPO
- To sum up
Business Process Outsourcing (BPO) handles every part of the implementation and even serves as your financial team, freeing workers for other crucial initiatives and inventions. It ensures that your finance and accounting operations run smoothly both during this technological change and after go-live.
According to detailed information and reports about outsourcing in 2023, business owners choose business process outsourcing as a practical solution. The change to the new normal was responsible for the quick shift to remote work, which won't always be possible with internal staff on its own.
As a result, several organizations rank and identify the best and most promising outsourcing destinations.
Statistics on Global Outsourcing
According to A.T. Kearney's Global Services Location Index, India continues to be the top country for business process outsourcing, with China and Malaysia following closely behind. The consultancy examines the most cost-effective, competent, and business-friendly areas for outsourcing services in its most recent Index, enabling firms to cut expenses for frequently repetitious and expensive activities.
In addition to location, the 2019 Kearney research underlined the significance of automation and cybersecurity as other aspects that nations take into account when choosing a BPO operator.
Over 80% of logistics leaders planned to boost their outsourcing spending more than 5% by 2020, according to Gartner, an information technology (IT) research and advisory firm. They were considerably helped by outsourcing their logistics, which allowed them to achieve or even surpass their end-to-end (E2E) supply chain and overall company objectives. This is one explanation for this.
The expansion of end-to-end third-party administration, on the other hand, led to a 9–11% growth in the life and pension insurance BPO sector, according to Everest Group, a global research organization. Since 2014, the sector has consistently grown yearly by 9–10%.
Statistics for the Outsourcing Sector for the Last 18 Months
Businesses have switched to digitalized operations as the pandemic spread worldwide. With over 68% of businesses outsourcing services, the US has the highest rate of outsourced jobs worldwide. A talent shortage is the primary driver of 48% of UK enterprises' outsourcing of business services.
Due to the growing need for remote and telemedicine services, the healthcare sector is currently one of the most outsourced segments.
According to Deloitte, in 2022, the worldwide outsourcing market is expected to surpass $10 trillion. In 2025, it is anticipated that global outsourcing and remote services will clock $19.5 billion.
Businesses will keep using cloud solutions for IT outsourcing, which are anticipated to reach "a mammoth $760 billion" in 2027.
In the meantime, cybersecurity continues to rank among the top worries for multinational firms. This is mainly useful when recruiting remote workers. Companies are becoming increasingly concerned about the security and privacy of their data as a result of an increase in cybersecurity threats and data breaches that have been documented in 2020.
This compels BPOs as well as their clients to develop a long-term remote work strategy to continue enhancing their data security.
Growing mid-market enterprises and high-growth, early-stage businesses that haven't yet developed internal finance teams make excellent candidates for the BPO-enabled route to a full NetSuite installation. A software firm, for instance, which has to scale quickly but is still using QuickBooks, can easily sublicense NetSuite through a BPO provider, such as ScaleNorth, for a quick and affordable upgrade.
BPO is the practice of outsourcing one or more essential business operations. On the NetSuite accounting platform, NetSuite BPO partners provide fundamental bookkeeping, part-time CFOs and controllers, audit support, monthly closes, and more. Businesses with income ranging from pre-revenue startups to $500 million and above can collaborate with these providers. Their staff members are knowledgeable about the provider's preferred platform and can assist businesses in quickly getting up and running.
The BPO as a Migration Strategy
Any business that still uses manual procedures, spreadsheets, or simple accounting software like QuickBooks can benefit from outsourcing while setting the groundwork for a successful long-term financial plan.
According to Joe Rovirosa, general director at NetSuite BPO partner ScaleNorth, “Having a partner that can stand you up on NetSuite while also keeping your operations running and the machine moving at full speed while you make that changeover is really crucial.”
Rovirosa lists a few approaches companies can use:
• Partner to oversee accounting on your legacy system, and maintain the partnership after NetSuite go-live and during the migration.
• Access BPO and a reasonable sublicensing arrangement.
• Launch a conventional NetSuite rollout while your team maintains legacy systems, then embrace a BPO partnership following go-live to outsource accounting tasks.
Let’s delve deeper into these possibilities.
BPO Before and After Migration
The BPO provider’s expertise will be a part of your team when gathering the implementation needs, bringing a wealth of knowledge about your business model, strategy, and financial procedures. The implementation team will receive directions from them regarding important objectives and needs.
According to Dani Sandler, Certified Public Accountant (CPA) head of BPO accounting for ScaleNorth, “This technique helps your firm to ‘get ahead’ of a NetSuite rollout by using a phased approach that results in a seamless transfer between the two systems.”
Conventional NetSuite Deployments
Solutions from NetSuite Businesses can purchase NetSuite from providers like ScaleNorth, then have it implemented and optimized for them. The CPAs of the provider can take over a part of or all required activities once your company is prepared to use NetSuite for all of its financial and accounting needs.
This strategy may be appropriate for your company for a number of reasons: The most popular cloud-based ERP system in the world is now completely in your control. Within the constraints of NetSuite’s licensing agreements, you can configure the system to best meet your needs as the licenses are yours.
After the setup is finished, you may decide whether to train current employees in NetSuite or bring on new team members who are already familiar with the software. Alternatively, you can engage in a BPO arrangement, in which case you will have access to a group of outside accounting and finance experts to manage your business. In most cases, businesses discover that a BPO partnership is cheaper than recruiting, offers more flexibility for businesses with seasonal or cyclical changes, lowers overhead, and facilitates faster scaling.
Sublicensing for NetSuite
You can acquire access to a NetSuite instance by sublicensing with the help of the BPO provider. This route offers NetSuite’s whole power at a cheaper cost. In addition to the license you have acquired, providers can offer services and also buy the license on your behalf. This offers some financial advantages and can reduce some risks associated with purchasing a new ERP system. However, it has significant operational usage restrictions.
If the provider buys the license on your behalf at first, you always have the choice to take control of it later on without having to re-implement it. However, it is significant to highlight that no administrator credentials have been disturbed. Instead, the BPO is in charge of managing the NetSuite instance, and your team has access to all necessary features.
Once the sublicensed instance is customized for your company, the BPO may offer outsourced accounting, much like the conventional approach. However, there are several significant distinctions between these two tactics:
Standard licensing is ideal for companies who want full operational access to the system or have the resources to host their own NetSuite instances.
A sublicense strategy is costlier because sublicensing an existing NetSuite instance is less expensive than buying your own. When businesses are strong supporters of exporting and maintaining small internal staffs, the sublicensing model performs excellently.
The partner offers transitional talent for accounting and installation, regardless of whether your business chooses to acquire a NetSuite license independently or benefits from a sublicensing arrangement.
Offering the Best of Both Worlds-NetSuite and BPO
Regardless of your licensing strategy, the end result of an ERP system should be a more adaptable, effective, and financially successful firm. Business transformation is difficult to achieve, but it is possible thanks to the potent alliance of modern technologies and a strengthened finance and accounting team.
Let’s examine six major advantages of a migration strategy supported by BPO
1. Reduced Overhead
Any organizational reform should aim to increase income while enhancing operations. One of the most effective and high-return undertakings your business can do is the implementation of NetSuite. A team of outsourced accounting and finance experts will assist your company to maximize profits if you are trying to get the most out of your investment. You simply pay for the services you require, which saves money on hiring, training, benefits, and office space costs.
2. Less Volatility, Smooth Scaling
Having the ideal internal workforce can be challenging to prepare for, whether you experience peak needs at monthly, quarterly, or year-end; are subject to seasonal swings; or are just expanding swiftly. If you hire too many accountants, you will be stuck covering their overhead and wages during slow periods. If you hire too few people, you will end up with overworked, burnout-prone workers. Your accounting activities can be outsourced, which allows for easy personnel additions and removal, cost savings, and enhanced operations.
3. Expertise in NetSuite
The accountants of a NetSuite partner are totally committed to NetSuite; they frequently hold advanced NetSuite certifications and are CPAs (Certificate Public Accountant). Due to their exceptional platform efficiency, they are frequently able to manage the workload of two or more internal personnel.
4. Less Obstacles to Access
The unknowns involved in switching to a new system might discourage many decision-makers from taking action until growth becomes unmanageable or they fall behind more agile competitors to the point where the company fails. These dangers are eliminated by choosing BPO.
5. Staging Prior to Migration
In order to prevent issues from transferring into NetSuite, it is critical to understand how any gaps or pain areas in your accounting procedures will be fixed. Before the migration starts, make sure your chosen BPO partner has CPAs and accountants who can work inside QuickBooks or your old accounting system to:
• Examine your present procedures
• Verify that everything is prepared for the migration to NetSuite.
• Learn things that will assist the NetSuite deployment to proceed smoothly and efficiently, which will increase the project's return on investment.
6. Reporting and Visibility Improvements
Employees of BPO are not only professionals in automating and modifying the platform; they also have years of advancing NetSuite finance knowledge. You will have access to their superior accounting expertise in addition to getting thorough reports, dashboards, projections, among other things.
To sum up
In addition to helping your company stay on schedule as you shift from a very basic system to an advanced platform like NetSuite, partnering with a BPO provider greatly reduces the risks associated with large ERP projects.
For instance, ScaleNorth recently worked with a $75-million business that had obtained substantial venture capital funding but lacked the accounting team or resources to handle a migration to NetSuite. The business established a BPO partnership with ScaleNorth, which is putting NetSuite and full licenses into use.
NetSuite has distilled the wisdom gained from tens of thousands of global installations over the course of two decades into a set of best practices. It offers a clear path to success and has proven to generate corporate value quickly. For any queries regarding NetSuite, get in touch with Jobin & Jismi.