India has their sights set on more than jut IT and Customer Service-

[Beaker]

I was talking today to a friend of mine who has his own business as a broker of plastic and resin, primarily for injection molding(BTW- he's not seeing much evidence of a "recovery" in the sector he sells too, but that's not what this is about).

He had stopped to talk to his friend the accountant, and drop off his recordsto have his taxes done...they got to talking, and the accountant friend told him how accounting firms in India are now starting to solicit business from American companies- and at the cut-rate prices we've come to expect.

another U.S. sector getting ready for another meltdown?

something's gotta give...soon.

[NYC]

1. That is already happening.

I read about it months ago. Sorry I can't remember the company name.

[drdigi420]

2. see? its good for the economy

well, for bush's buddies' economy

it's easier for them to pull enron/harken-like scams with foreign acounting firms - less oversight

[_Jumper_]

3. Is India the only one doing all this?

A highly-educated, poor country like Russia is MIA in this game?

[muriel_volestrangler]

5. Educated Indians know English well

which gives them a huge headstart in getting white collar jobs from English speaking countries.

[jburton]

4. It's already HAPPENED

(press release - no copyright)

http://www.accenture.com/xd/xd.asp?it=enweb&xd=_dyn%5Cdynamicpressrelease_619.xml


Outsourcing of Finance and Accounting Functions Likely to Grow, According to Study by Accenture and EIU

Executives View Outsourcing as ‘Strategic Weapon for Change’

NEW YORK; June 17, 2003 –The outsourcing of finance and accounting functions is primed for growth, with more than 70 percent of senior executives predicting that demand will become even more prevalent over the next three years, according to a study released today by Accenture and the Economist Intelligence Unit (EIU).

The study, which examined finance and accounting outsourcing, consisted of an online survey of senior executives from 236 companies representing a variety of industries across North America, South America, Europe and Asia. The survey was complemented by one-on-one interviews with senior executives at another 44 companies globally.

Approximately 30 percent of the companies that participated in the survey reported that they outsource finance and accounting functions, with two-thirds of those (65 percent) characterizing the arrangement as successful (57 percent) or very successful (8 percent). And, while cost savings and increased productivity are key motivators for outsourcing, the study determined that finance and accounting outsourcing is increasingly being used as a catalyst for business transformation.

“Cutting costs and enhancing productivity remain prime motivators, but it’s clear that some companies see outsourcing as a strategic weapon for change,” said Stewart Clements, global managing partner for Accenture Finance Solutions, which provides finance and accounting services on an outsourced basis. “Outsourcing brings an outsider’s discipline to reviewing and reshaping entire business processes, helping companies execute ambitious improvement plans.”

Indeed, commentary from respondents who participated in the one-on-one interviews with the study’s researchers supported the view that companies are increasingly leveraging outsourcing for strategic benefits. “We needed a fast turnaround, so we turned to Accenture to help us centralize several functions, including finance,” said Marco Trecroce, group business transformation and operations director, Thomas Cook UK. “Thanks to our arrangement with Accenture, which we call co-sourcing, we’ve transformed our finance function and created a shared service center and customer-oriented culture for the company.”

According to the study, the finance and accounting function most commonly outsourced is payroll, with 27 percent of the survey respondents who outsource reporting that they outsource this function. Budgeting and forecasting are the two finance and accounting functions least likely to be outsourced. Not surprisingly, the survey indicated that executives are more inclined to outsource generic finance processes than core operations.

Other key findings of the study:

Surprisingly, 82 percent of survey respondents who said their companies outsource finance and accounting said they have no formal metrics in place to measure the success of the outsourcing arrangement. “Metrics clearly encapsulate the arrangement objectives, provide a focus for delivery and clearly measure the results,” said Clements.
Two-thirds (66 percent) of respondents who said their companies outsource some finance and accounting functions cited lower costs as the primary benefit of outsourcing. For instance, a French specialty chemicals company reported that it reduced its finance and accounting costs by 30 percent in two years by outsourcing these functions.
Respondents reported that the benefits of finance and accounting outsourcing transcend cost reduction, with 32 percent pointing to increased business productivity on the part of the finance team.
More than 55 percent of those surveyed felt that finance outsourcing sharpens the focus on core competencies, a key enabler in business transformational change.
The drawbacks of outsourcing cited most often by survey respondents were the risk of valuable data falling into competitors’ hands (52 percent), the risk that the cost of outsourcing will exceed expectations (48 percent), and the erosion of in-house knowledge (45 percent).
While the study did not break out findings by region, it determined that the outsourcing of finance and accounting is gaining acceptance in the Asia Pacific region, where it is not yet as common as in the United States or Europe. Economic expansion, especially in China, is one reason for the anticipated growth in Asia.

The study also includes a list of what Accenture refers to as the “golden rules” of finance and accounting outsourcing, which include tips on how to address typical outsourcing issues. “This is a valuable tool that codifies the experiences of participants and can help other companies make their finance and accounting outsourcing experiences a success,” said Clements. A complete list of the rules is available in the press room on the Accenture Web site at www.accenture.com.

About the Study
Accenture, in cooperation with the Economist Intelligence Unit (EIU), conducted a wide-ranging global study aimed at helping senior executives grasp the opportunities and defuse the risks posed by finance and accounting outsourcing. Conducted during January and February, 2003, it was comprised of an online survey of senior executives from 236 companies in a wide variety of industries across North America, South America, Europe and Asia, as well as one-on-one interviews, conducted by researchers from Accenture and the EIU, with senior executives from an additional 44 companies globally. The full report is available on the Accenture web site at www.accenture.com. Its title: Outside upside: Finding focus through finance outsourcing

About Accenture
Accenture is the world's leading management consulting and technology services company. Committed to delivering innovation, Accenture collaborates with its clients to help them realize their visions and create tangible value. With deep industry expertise, broad global resources and proven experience in consulting and outsourcing, Accenture can mobilize the right people, skills, alliances and technologies. With more than 75,000 people in 47 countries, the company generated net revenues of $11.6 billion for the fiscal year ended August 31, 2002. Its home page is www.accenture.com.


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[markus]

6. Once they start outsourcing the lawyers

we'll finally see something done.

Seriously, if the professional classes (and by that I mean lawyers, doctors, accountants) start getting hurt, the GOP will start to sit up and take notice.

They don't care too much about IT guys like me. But, hey, I work in a field related to imaging. I don't see any reason not to have all of the xrays and other non-invasive work of that read in India. Hell, then all we need are some grunts who can remember to put their lead aprons on.

Now if we can just figure out how to start outsourcing the lawyers. (Actually, with telepresence, I don't think that's too far fetched).

[kcwayne]

8. They have already started outsourcing lawyers

There are firms set up, and being set up in India to do patent research, contract drafting, and legal research.

Wall Street has said they are outsourcing 500,000 jobs over the next 5 years to India.

There are also firms that do radiology analysis, using a digital network to send the info from the US, and read by Indian radiologists who make a fraction of the $200K that American radiologists make.

60 Minutes did a segment a couple of weeks ago about an H&R Block type operation in India that is doing personal and corporate tax returns, all online. They spoke with an American who started the company over there. He pays his Indian accounts $5K per year, and has them working in a crowded sweatshop.

As a soon to be unemployed IT worker, I wondered if I could go to India to get a job. But I am pretty sure that I could not get a Visa that would allow me to work there. Image that.

[NewJeffCT]

7. i believe at least one of the Big 4 already does

I'm pretty sure Deloitte & Touche has outsourced some of their labor intensive accounting grunt work to India... not sure about KPMG, Price Waterhouse Coopers and Ernst & Young.

[shimmergal]

9. Here's a question.

My daughter has had an ongoing audit from the IRS since early last fall. (What a nightmare! She's a tipped employee in Vegas and IRS _loves_ to investigate them.) Anyhow, it's almost finished,--she turned out to be 95% or more right about her deductions. They gave her a date of Jan. 28 by which they should be finished & get back to her.

Well, needless to say, they didn't. She, and her tax advisor, have been calling them to find out what's up. A couple of days ago, she called. The person at the other end told her they were wrapping it up and she should get an answer in the mail within a few days.

The funny thing is, my daughter said the IRS person had such a strong accent it was hard to understand her, and it sounded like an Indian accent. Is it possible even the IRS is outsourcing their work to India this way?