Outsourcing and Offshoring Finance Activities
Article

Outsourcing and Offshoring Finance Activities

Siri Terjesen
IGI Global, 2006

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Recommendation

Companies are facing spiraling operating costs. Siri Terjesen, an assistant professor of strategic management, offers a host of potential solutions to this problem. She outlines what finance activities firms could modify to drive sustainable value. Though Terjesen’s work merely scratches the surface, getAbstract recommends her research to chief financial officers, chief operating officers and employees of global businesses who are looking for ways to reduce finance costs.

Summary

Outsourcing finance activities can be a viable option to reduce costs. Typically, companies outsource repetitive tasks that rank low on the value spectrum, such as payroll. Strategic finance tasks, such as budgeting, usually remain in-house due to their high value. Outsourcing has “five key drivers”: “Automation” occurs when firms eliminate human participation from tasks. “Disaggregation” is when a worker’s duties get split into discrete tasks. “Consolidation” means aggregating tasks at a central site. “Commercialization” involves reorganizing activities by turning them into a “profit center” within the ...

About the Author

Siri Terjesen is an assistant professor of strategic management and international business at Kelley School of Business at Indiana University–Bloomington.

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