Dun & Bradstreet’s widely cited
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When an offshoring relationship goes south for an accounting firm, it’s natural to blame the vendor and assume offshore teams will never perform as well as their U.S. counterparts.
If you’ve had a bad experience, ask yourself: “Did we set the vendor up for success?” Were your expectations aligned around turnaround time, workflows and data security? And even if you set those expectations, did the U.S. side hold up its end of the bargain? There’s more to the offshoring equation than getting decent work done on the cheap.
Setting expectations
Setting expectations has two important parts:
- Map out what success looks like and share that vision clearly with the vendor. In order to win your business, most vendors are hesitant to admit they can’t do something. Make sure the vendor can provide references or proof they’ve delivered a similar outcome for someone else. If they can’t, keep shopping.
- Be crystal clear about quality standards, turnaround times and communication. For instance, if working with a team in India, don’t assume they’ll respond to your email within 24 hours, even if it’s marked “priority” — that’s not part of the culture there unless you spell it out from Day One. Also establish escalation procedures, points of contact on both sides, and how holidays are handled in both countries.
Did you tell your vendor upfront: “Here is what I want to achieve, here is the process I’d like to follow, and here is what I want you to do if things start to go wrong”? Did you adjust your workflow for different time zones? Did you track the right metrics once the program was underway? Did you interview the people doing the hands-on work, rather than just the account manager?
Understanding cultural differences
Workers in India prefer the camaraderie and structure of a traditional office setting and may feel less engaged if they’re told to work remotely. Workers in Argentina, in contrast, prefer working from home. In India and the Philippines, workers won’t readily raise questions or point out confusion — in their culture, it implies they’re not paying attention or are challenging their superiors. The onus is on the U.S. side to make offshore workers feel comfortable asking questions and to reassure them their job is not at risk when they do.
Also, workers in many offshore countries don’t respond to calendar invites promptly — it’s simply not part of the culture. You may go into a meeting not knowing who’s showing up unless you clearly spell out how quickly they must accept or decline. Offshore workers also tend to be more relaxed about deadlines than those in the U.S. and Canada. If you give an offshore colleague a deadline two weeks away, don’t expect them to honor it unless you check in every few days for a progress report.
Printed manuals and FAQs don’t work as well with offshore workers as video instructions. Use tools like Loom to record your screen and walk viewers through a task. For standard operating procedures, tools like Scribe can create detailed, step-by-step documentation in seconds. For every task you want your offshore team to handle, there should be an accompanying video or SOP.
Introducing an offshoring initiative
When you selected your offshoring partner the first time, did you hold a town hall with your U.S. team to explain the decision? Or did you simply announce that offshore workers were coming in? Without a clear explanation of the rationale and benefits, U.S. employees will assume it’s about cutting costs and that their jobs are in jeopardy. They may actively resist the offshore team, assuming that they’re training their own replacements.
A better approach is to explain upfront why you’re bringing in offshore workers, how the relationship will work, and how offshore teams can actually benefit U.S. employees — freeing them up for higher-value, more stimulating work, improving work-life balance, and expanding the firm’s service offerings.
Once the offshore operation is running, designate an advocate that your U.S. team can turn to with concerns. It’s important they have a real person to consult, not just a search engine or AI. I bet you didn’t consider this the first time.
Worker turnover
Turnover is a reality in offshoring. India typically sees 10% to 20% turnover; the Philippines falls in the middle; Argentina has the lowest turnover, though its talent pool is smaller and requires more training. As a general rule, the Philippines is a good option if you only need one or two people offshore. If you need a larger team, India tends to be a better option. And if you need more hands-on training, consider Argentina.
To reduce turnover across all three countries, focus on five things:
- Recruit right. Be transparent about your firm’s culture and growth goals so the wrong candidates self-select out.
- Test rigorously. Use technical assessments during hiring to ensure candidates meet your standards from the start.
- Invest in your people. Support their growth and professional development just as you would with your U.S. team.
- Hire directly rather than through agencies. Direct hires earn more and feel a greater connection to your firm’s culture and brand.
- Promote high performers. It’s very important for high performers on your offshore team to feel like they can grow within your firm. For instance, if you hire offshore preparers and they do well in their first year, make sure the following year that they’re preparing more, higher-complexity returns. It’s the same for offshore reviewers. If they’re also training junior people, there should be a clear path to promotion. When offshore team members’ efforts aren’t recognized, that’s when turnover kicks in.
Three things to do better the second time around
Things tend to go better when you take back control, start small, and get the right help.
- Focus on control. You want to take ownership and exert control over as many aspects of your offshore operations as you can. If you’re going direct, it’s straightforward — you own and control all aspects of your offshore team. But even if you’re working with an agency, you want to control as much as possible. When it comes to recruiting, are you choosing from an open pool of candidates or from a smaller pool of pre-vetted candidates from the vendor? Make sure the vendor allows you to control such things as training, workflows, setting quality standards and adhering to those quality standards. Make sure you’re able to control, and therefore align, the goals and incentives of the people working on your overseas team.
- Get data security right. Even if you use an agency, make sure you own every laptop that your offshore team is using. That allows you to control every piece of software on each laptop. You can also install monitoring tools that flag suspicious activity. That enables you to act immediately if needed. Remember, your team is working with clients’ highly sensitive financial information. Data security is imperative whether the work is being done in the U.S. or abroad.
- Go slow. Don’t try to fix everything at once. Start with a small team and give yourself a year to experiment and learn. If going direct, don’t set up your own company right away — use an international professional employer organization to stay compliant and avoid red tape. Rent co-working space rather than signing a long-term lease. Consider starting with your C or D clients rather than your best ones and assign less complex work at first. As the offshore team gains confidence, you can work out the kinks and gradually move on to more complex tasks and higher-value work.
Offshoring takes time to get right. Don’t rush the process. Talk to someone who’s navigated it before — their guidance can help you avoid costly mistakes and save significant time.
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