Executive Summary

The Finance and Accounting Outsourcing (FAO) market transformed over the last two years, experiencing close to 100% growth during this period, with further double-digit growth anticipated for the next two years as the market begins to reach maturity. Three factors are driving the continued growth: customer success stories, aggressive supplier investments in developing F&A process capabilities and a global footprint, and an increased willingness for organizations to transform their F&A process in order to take advantage of the business benefits and lower costs of global sourcing.

It is now unarguable that the FAO model provides organizations with lower costs and, in many cases, more rigorous process acumen and access to superior technology in the medium term (two to three years). However, customers must have assurance that their supplier will continue to deliver innovation and business value post transformation and transition.

Nurturing innovation in FAO is not a product that can be tactically enveloped into an FAO contract. It is a strategic initiative, which demands that both customer and supplier work closely together in order to maximize value and provide financial excellence on an ongoing basis throughout a 10-year contract and beyond. In this new generation of FAO, innovation is already taking center stage.

Throughout this white paper, the Everest Research Institute defines innovation in an outsourcing context, analyzes the importance and emerging areas of innovation in FAO, and highlights the best practices for both customers and suppliers in creating an environment conducive to ongoing business value and innovation.