Staffing shortages are squeezing many industries, especially accounting and bookkeeping. Accounting and bookkeeping firms, big and small, are struggling to find solutions to this crisis.
On Episode 95 of the Woodard Report podcast (sponsored by RightWorks), Heather Satterley and Joe Woodard discussed outsourcing and offshoring strategies—a controversial topic, but also a potential solution to the shortage, especially for smaller firms.
Woodard and Satterley covered the "why" and "what" behind outsourcing and practical strategies for integrating it into a business.
Woodard opened the discussion by addressing common concerns around outsourcing, particularly the fear of exploiting workers in developing countries. He emphasized that when outsourcing is done responsibly, workers are often well-compensated, enjoy good benefits, and are eager to work in outsourced roles.
“You're not taking advantage of them,” Woodard said. “You're supporting them.”
Woodard argued that outsourcing is a good solution for firms experiencing staffing shortages because it provides cost-effective labor solutions for some functions while freeing in-house staff to focus on higher-value tasks. Routine, but essential tasks like bank reconciliations and journal entries can be outsourced, allowing members of your team to focus on more strategic services, such as financial planning and analysis, or even upskilling into new roles. This helps create a stronger team and provides clients with better service, empowering accounting and bookkeeping firms to become more profitable.
Another major benefit of outsourcing, he explained, is the flexibility to scale up or down as needed. Woodard explained that by leveraging outsourcing firms, businesses can easily adjust the number of full-time equivalents (FTEs) based on client demand, allowing them to remain agile without the burden of hiring and layoffs.
Woodard also took a deep dive into the "pod approach" to outsourcing. With this model, Woodard described how a dedicated team of outsourced workers can be trained in a firm’s processes and technology, ensuring that even if a team member is unavailable, others can step in to minimize disruptions to workflow. The pod model offers consistency and helps firms avoid the risks associated with individual placements, such as employee turnover.
Satterley took the opportunity to challenge another common misconception around outsourcing: That outsourcing is only for large firms.
“One of the things that I hear a lot when we're talking about offshoring and outsourcing is that it's really only for big firms, and that's a common misconception,” she said. “I know several solo practitioners or small firms that have been extremely successful in partnering with offshoring, outsourcing companies to grow their practice and find work-life harmonization.”
Satterley argued that outsourcing can be used as a tool for managing fluctuating workloads in small organizations as well as larger ones without needing to hire full-time employees for every task.
She also cautioned against relying on gig-based platforms like Upwork for outsourcing, explaining that without proper vetting and management, businesses could face inconsistency. Instead, working with reputable outsourcing companies provides more security and reliability, allowing firms to grow with confidence.
Towards the end of the episode, Woodard shared some tips about integrating outsourcing into a business. He emphasized that outsourced workers should act as an extension of the internal team, using the same tools and workflows. He stressed that it is crucial to ensure that outsourced team members are aligned on communication methods with the account manager.
“If you use Slack, they should be in your Slack,” he said. “If you use Teams, they should be in your Teams…they should be using whatever you're using.”
He also discussed the importance of setting clear deadlines for outsourced workers. By holding them to the same standards as in-house employees—ideally through a multi-layered review process—firms can ensure quality and timely delivery.
Many accounting professionals face staffing challenges, but this challenge is not insurmountable. There are options to overcome the staffing crisis, and outsourcing may be a good fit for your organization.
To listen to the entire conversation and hear Woodard and Satterley’s insights about outsourcing, addressing staffing challenges, Game of Thrones and more, download this episode of The Woodard Report Podcast.