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Why Outsourcing Could Be A Good Win For Your Business

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Outsourcing is still a very controversial topic in our profession. With the risk of sharing my thoughts that may be contrary to your own views, I do believe it to be a topic that deserves an open, healthy debate.

Late last year I had a planning day with an Australian Accountant whose response to outsourcing was that of many other Accountants I have discussed the topic with. They were totally against it and believed it to be an immoral activity. They said we should be loyal to Australia and both hire Australian staff and buy Australian goods. 

I explained that China had reduced its poverty from 88.6% down to 1.47% through trade and capitalism. As the entrepreneurs increased their wealth they created the tide that raised all boats and raised the wealth of the average person in the street. It has had a significant impact on their society and has pulled many people out of poverty. This was done through trade. 

Straight after the Second World War, Japan’s wages were really low and therefore their products were really cheap. Through trade, their wages and standard of living increased and today their wages are the same as ours in Australia. Then they went to China as their wages and goods were cheap. Today their wages are higher. 

Australia’s unemployment rate has always been around 5% which is full employment. 

That’s because our economy is growing at around 3% GDP which will keep the unemployment rate at 5%. We have lost our manufacturing industry and we are still at full employment.  Even when they closed down our car manufacturing in South Australia and 6,000 lost their jobs they have all been absorbed into other industries. 

If we have full employment and we are right up there in the top 10 wealthiest countries in the world, I cannot see why we shouldn’t help another country take their people out of poverty by hiring their people when we in Australia are comfortable. 

In my experience with our outsourcing endeavours at Chan & Naylor, it really warms my heart when I hear how some of our overseas staff have been able to pay for their father’s heart operation or buy a house or a car or feed their extended families and provide them medical care. Their opportunity to work with our organisation has had a dramatic effect (positive) on their standard of living and well being. 

 

Outsourcing is a win-win for all. 

  1. We win because we can save some money. 
  2. Our staff win because we can now pay them more wages from the savings we make. 
  3. Our clients win because we can reduce our fees to them. 
  4. Overseas staff win because we can contribute to getting their people out of poverty. 
  5. Our country wins because we can reduce our immigration rate which creates other overcrowding issues but at the same time, we are able to address our labour shortages that are driving costs up. 

 

As I mentioned, I understand if you have a differing view on the insights above, however, I do invite your feedback and debate on this topic. By doing so, we will only make our profession better.

 

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