ISG Provider Lens™ Finance and Accounting Outsourcing (FAO) Services - Archetype Report 2017

This ISG Provider Lens™ report summarizes months of research focused on Finance and Accounting Outsourcing (FAO) services, key service providers in this space, and the buyers of these services. This report summarizes the relative capabilities of FAO services providers and their abilities to address the requirements of four typical, frequently encountered categories of enterprise user types (“archetypes”). Each archetype represents a unique set of business and technological needs and challenges.

Our research indicates that the FAO market, though traditional in nature, is emerging as an innovative and technology-driven service segment. We see more and more providers with diversified portfolios and capabilities catering to the needs of different enterprise clients in this space. However, rapidly-changing enterprise client needs make it increasingly difficult for service providers to build expertise and offer services around every aspect of FAO. This is due in large part to two core realities regarding the archetypes:

1. The characteristics of each archetype are a moving target over time, because, while the core requirements rarely change, the relative importance of different requirements can vary based on business and/or technological environment changes.
2. Multiple archetypes tend to be present in most enterprises, especially in larger firms. As the requirements of each archetype evolve and adapt based on business and technological changes, so too do the presence and value of each archetype.
   

This gives CFOs and decision makers a series of choices when it comes to FAO services provider selection. Striking and maintaining the proper balance between archetype requirements and service provider capability is a mandate to achieve optimal business value. Within the ever-evolving outsourcing space, it will be hard to standardize client requirements and map them against one particular client archetype without anticipating future needs. Thus,

1. Service providers need to have a complete understanding of the client’s internal technology landscape and outsourcing objectives. They should be able to relate to the client’s existing archetype and their future requirements. This will enable them to design solutions while providing insights, more as a consulting partner.
2. Enterprise clients need to understand their organizational characteristics to lay out an effective outsourcing plan, analyze suitability and choose service providers based on their requirements.

Note: This report presents services providers’ known capabilities in the context of user enterprises’ typical project needs (i.e., archetypes). This report is not meant to rank providers or to assert that there is one top provider with the abilities to meet the requirements of all clients who identify themselves with a particular archetype.

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