{"id":1037,"date":"2022-05-10T15:08:25","date_gmt":"2022-05-10T15:08:25","guid":{"rendered":"https:\/\/www.arthurlawrence.net\/blog\/?p=1037"},"modified":"2024-06-26T12:41:36","modified_gmt":"2024-06-26T12:41:36","slug":"offshore-staff-augmentation-vs-transformational-outsourcing","status":"publish","type":"post","link":"https:\/\/www.arthurlawrence.net\/blog\/offshore-staff-augmentation-vs-transformational-outsourcing\/","title":{"rendered":"Dealing With Labor Shortage In Finance: Offshore Staff Augmentation Vs. Transformational Outsourcing"},"content":{"rendered":"\r\n

As the economy is recovering from the effects of COVID-19, many businesses realize that the new normal, in some ways, can be very different from how they operated pre-COVID. Take, for example, the topic of labor shortage. The U.S. Bureau of Labor Statistics reported that over 4.5 million Americans left their jobs in November 2021 alone. The Organization for Economic Cooperation and Development found that 20 million fewer people are working now than pre-COVID. With the shortage of qualified employees, companies are finding that they need to be creative in building a resilient and robust workforce to help them survive and thrive in this economy.\u00a0<\/p>\r\n\r\n\r\n\r\n

To build and sustain a productive workforce, companies need to explore alternative options, including offshore staff augmentation and transformational outsourcing. The following white paper explores each option, highlighting its benefits and considerations.\u00a0<\/p>\r\n\r\n\r\n\r\n

Transformational outsourcing allows companies to improve efficiencies and effectiveness by outsourcing transaction-intensive processes, thus focusing on more strategic activities. Transformational outsourcing helps achieve accelerated and sustainable operational and cost improvements across various back-office functions, including HR, supply chain, IT, and finance & accounting.<\/p>\r\n\r\n\r\n\r\n

On the other hand, offshore staff augmentation allows companies to reduce costs by employing resources in lower-cost locations. There are two aspects of offshore staff augmentation: 1) short-term or project base and 2) long-term or operationally focused.<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Transformational outsourcing<\/strong><\/h2>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Transformational outsourcing is hiring a third-party service provider specializing in the processes you want to optimize through transformation. Processes such as finance & accounting are prime candidates for transformational outsourcing. Transformational outsourcing is a great option when you outsource transaction-intensive processes such as accounts payable, collections and cash applications, bank reconciliations, etc. These processes transformed and outsourced will allow the retained staff to focus more on strategic analysis-based work.<\/p>\r\n\r\n\r\n\r\n

In transformational outsourcing, the service provider ensures that key service level agreements and key performance indicators are delivered according to the terms and conditions outlined in the service contracts.<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Key Benefits<\/strong><\/h3>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

– Transaction intensive processes are delivered from lower-cost geographies<\/p>\r\n\r\n\r\n\r\n

– Day-to-day processing activities are transferred to the service provider<\/p>\r\n\r\n\r\n\r\n

– Redesigned processes are more efficient and provide better controls<\/p>\r\n\r\n\r\n\r\n

– Best\/leading practices are implemented, allowing the processes to be optimized<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Considerations<\/strong><\/h3>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

– A sense that overall control of specific processes is lost<\/p>\r\n\r\n\r\n\r\n

– Limited ability to redirect the service provider staff to work on other projects\/initiatives<\/p>\r\n\r\n\r\n\r\n

– Change management will have a significant impact on the overall success of the partnership with service providers<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Offshore augmentation<\/strong><\/h2>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

For short-term or project base staff augmentation, resources are onboarded and deployed with specific objectives (e.g., reducing late payments to vendors, clearing out unapplied cash balances, cleaning up master data, etc.). These resources will ‘roll off’ when the project is completed or until the onshore team believes it can manage the activities associated with closing the project. For long-term offshore staffing augmentation, resources are onboarded to act as an extension of the onshore operational team. These resources take their day-to-day cadence as if they are a part of the operating team.\u00a0<\/p>\r\n\r\n\r\n\r\n

When companies are short-staffed on skilled workers, offshore augmentation allows them to hire people with specific skills for a particular project. It helps companies maintain a lean workforce during particular periods. Here are some of the benefits of offshore augmentation.<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Key Benefits<\/strong><\/h3>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

– More control over offshore resources<\/p>\r\n\r\n\r\n\r\n

– The most cost-efficient delivery model<\/p>\r\n\r\n\r\n\r\n

– Leveraging service provider HR\/recruiting specialists to hire new resources<\/p>\r\n\r\n\r\n\r\n

– Short-term project-based resources can be brought on board to address specific issues without compromising operational efficiencies<\/p>\r\n\r\n\r\n\r\n

See Also: Why Offshore Staff Augmentation Is Beneficial For Midsize Businesses<\/a><\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Considerations<\/strong><\/h3>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

– Need to manage resources like they are an extension of the onshore team<\/p>\r\n\r\n\r\n\r\n

– Service providers typically will not be responsible for the overall quality of service delivery<\/p>\r\n\r\n\r\n\r\n

– Need to balance work hours since that will impact overall governance and staff attrition<\/p>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Arthur Lawrence’s Services<\/strong><\/h2>\r\n\r\n\r\n\r\n

 <\/p>\r\n\r\n\r\n\r\n

Arthur Lawrence provides offshore staff augmentation and transformational outsourcing services to mid-market businesses in North America. Related accounting services<\/span><\/a> include:<\/p>\r\n\r\n\r\n\r\n

– Order-to-Cash<\/p>\r\n\r\n\r\n\r\n

– Procure-to-Pay<\/p>\r\n\r\n\r\n\r\n

– Record-to-Report<\/p>\r\n\r\n\r\n\r\n

– ERP Design & Implementation<\/p>\r\n\r\n\r\n\r\n

– Robotics Process Automation (RPAs)<\/p>\r\n\r\n\r\n\r\n

If you still have questions about offshore augmentation and transformational outsourcing or want to learn more, don’t hesitate to contact Susan Primm at susan.primm@arthurlawrence.net<\/a><\/p>\r\n","protected":false},"excerpt":{"rendered":"Learn more about staff augmentation and the differences between offshore staff augmentation and transformational outsourcing.","protected":false},"author":2,"featured_media":2443,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5,191,10,200,2,190],"tags":[153,154],"class_list":["post-1037","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog","category-business-process-management","category-careers","category-finance-and-accounting","category-home","category-talent-acquisition","tag-transformational-outsourcing","tag-what-is-staff-augmentation"],"yoast_head":"\nOffshore Staff Augmentation Vs. 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