Finance and accounting outsourcing industry on fire. As enterprises become more comfortable contracting more of their finance and accounting duties, the worldwide finance and accounting outsourcing market is projected to grow from $US12 billion 1n 1999 to $US37.7 billion by 2004, according to Dataquest.
However, while there are many opportunities in the finance and accounting outsourcing arena Dataquest analysts believe many companies are still hesitant to outsource these crucial duties. Despite some high-profile contracts in the past few years, many potential customers still regard finance and accounting processes as too strategically important to their business to be entrusted to outsourcing vendors. Awareness of the potential benefits of finance and accounting outsourcing is still not well developed in many industries and geographies. Vendors need both to educate potential customers regarding the benefits of outsourcing and to develop realistic expectations and concrete performance evaluation criteria.
Opportunities in finance and accounting outsourcing will be strongest in industries characterised by larger company sizes, intense competition, low levels of regulation, rapid growth, widespread restructuring and merger and acquisition activity, extensive ERP adoption and prior outsourcing experience, Dataquest believes. New technologies and Web delivery of financial applications have accelerated the adoption of outsourcing as a way to increase operational efficiency, gain competitive advantage and create shareholder value.