For years now, Australian companies have been reaping the benefits of offshoring their back office processes, customer service and finance tasks.
An Ibis World paper, Business Process Outsourcing – Australia Market Research Report, released in January 2019 says the Australian Business Process Outsourcing (BPO) industry is worth $35 billion and growing at 3.3% per year.
More than 30,000 Australian companies are offshoring part of their operations to countries like the Philippines.
From the likes of Hall Chadwick to family-run accounting firms we work with, Filipino professionals are filling Australian talent gaps thanks to a high rating in English proficiency, literacy (97.5%) and years of practical work experience. Finding great talent at a fraction of local costs has helped Australian SMEs increase their competitiveness and ‘grow the business’ at the same time.
A History of Offshoring in Australia
Australians are no strangers to offshoring. Outsourcing’s high profile started to build in 1989 with ANZ IT sending work to over 400 software programmers in Bangalore, India. In 1999 Coles Myer offshored its credit card processing operations to India while Qantas opened a recruiting base in Thailand for a more ethnically diverse crew.
The years that followed saw more major companies offshoring jobs, mostly to cut costs. In 2003, Hutchison Telecommunications moved 200 customer retention and business support group jobs to Mumbai. In 2004, Telstra shifted 450 IT jobs from IBM Australia to IBM India; and Optus moved its call centre jobs from Devonport, Tasmania to India.
Over the next few years, Australian firms looked to the Philippines for offshore support. The country’s proximity to Australia and the high level of English proficiency made Filipinos the top choice for employees by Aussie companies.
Besides tech support and customer service, major accounting firms have tapped into offshore finance professionals for back-end support. This has helped create a strong talent pool of pre-trained and experienced resources already very familiar with Australian taxation and accounting standards, procedures, regulations and systems.
In fact, CPA Australia in 2010 created a report outlining the success of offshoring to local firms. It cited finance services which were being offshored successfully:
- employee payroll (27%)
- tax compliance and planning (21%)
- financial systems application support (16%)
- general and financial accounting (13%)
- travel and expense processing (12%)
- accounts receivables and collections (12%)
- accounts payable and vendor management (9%)
- financial reporting (7%)
- management report preparation and analysis (6%)
- treasury and cash management (4%)
- financial risk management (3%)
- budgeting and forecasting (1%)
Offshoring has grown even more since then! Small accounting firms are offshoring more transactional activities such as payroll, general ledger, accounts payable, accounts receivable, and other repetitive but necessary tasks. CPA Australia expects more of this type of work to be offshored in the years to come.
The Australian BPO industry in the Philippines is already mature. Companies like Staff Domain are in a strong position to offer an exceptional solution to talent acquisition and retention issues, as well as the reduction of salary related costs.
Offshoring historically started as a cost cutting exercise for large enterprises. However, for the SME sector and accounting firms in particular, it is now a sophisticated and highly viable way to bridge the talent gap so many accounting firms struggle to fill.
With a talented, loyal base of staff taking care of your back office offshore, it leaves room for local teams to focus on the high value and more consultative based work such as corporate risk management, budgeting and forecasting.