The outsourcing division of BDO in Russia and the rating agency RBC.Rating have summarized preliminary results of the popularity rating of business processes outsourcing types in foreign companies in Russia. Over 6000 foreign companies representing all market sectors participate in the project in Russia.
11 most widespread functions, among which are issue of visas and work permits for foreigners, legal support of activities of foreign companies in Russia, transportation and logistics, accounting in full range or its sectors, payroll accounting, staff recruiting/training, staff record keeping, software support outsourcing and some more types of functions which are more often outsourced to specialized providers have been chosen as subjects of the study of outsourcing demand in foreign companies. Foreign companies of over 20 market segments – consumer market, chemical industry, light industry, production of pharmaceutical products, banking sector, etc. – take part in the project.
The main goal of the study is not only to define the attitude of representatives of foreign companies to transfer of internal functions to outsourcing, but also to compare popularity of outsourcing in Russian and foreign companies represented in the Russian Federation by types of internal functions. As preliminary results show, this attitude is radically different (see Table 1). The most popular ones are issue of visas and work permits for foreigners and legal support of activities (58%), services in the field of logistics and transportation are on the second place (53%), outsourcing of some sectors of accounting is on the third place. According to the opinions of respondents foreign companies also prefer to outsource payroll accounting.
The study is based on the sole criterion of the share of foreign capital in the authorized capital of the company. In Russian companies the most popular functions for outsourcing are still “non-key and non-crucial”, such as physical security, services sector (including cleaning of rooms, corporate lunches, etc.), logistics and transportation, they occupy the first three top lines of the rating. At present Russian companies carry out typical functions of business processes outsourcing, for example, accounting functions, engaging internal resources of companies (see Table 2).
Ranging of quantity indices of the rating (including popularity ranging by types of business processes outsourcing of internal functions, assessment of the importance rate of the factors when decisions on outsourcing are taken, etc.) is built on the scale of one to ten (1 is the lowest score, 10 is the highest one). Ranging of quality indices is based on the amount of for and against answers received as the result of the study. The result of the comparison of popularity by types of internal functions outsourcing in Russian and foreign companies is as follows (see Table 3).
Sergey Tiunov, Director General, outsourcing division of BDO in Russia:
- Preliminary results of the study among foreign companies which we summarized in July clearly shown how different the attitude of representatives of the Russian and foreign business to such an instrument as transfer of internal functions to outsourcing today is. In foreign companies in Russia the practice of transfer to outsourcing of such function as accounting or payroll accounting is rather widespread because companies realize that this is rather a flexible instrument of optimization of internal functions. Among pluses of outsourcing I would mention, first of all, reduction of the company’s expenses, high confidentiality of customers’ personal data, automation of business processes and minimal dependence on the human factor. As the results of our first survey show, many Russian small and middle-scale businesses have not good enough studied this instrument yet, that is why supplementary functions, such as physical security and cleaning, are first of all transferred to outsourcing. Crucial but not key functions, such as accounting, are popular with foreign and large Russian companies. Among universal internal functions, to outsourcing of which the attitude of foreign and Russian companies is approximately similar, are legal support of activities, as well as staff training and recruiting. I believe that as business processes outsourcing develops in Russia, popularity of outsourcing of the functions which are key and crucial for the company will grow.
Dmitry Prytin, Chief Editor of RBC.Rating:
- Interest to this survey on the part of representatives of the business community is, no doubt, rather high. Firstly, a detailed study of business processes outsourcing in Russia with ranging by Russian and foreign companies represented in Russia has not been carried out because the majority of companies have previously faced mainly development of IT outsourcing; as far as services sector and physical security are concerned, to these functions the term “outsourcing” is applied extremely rare. Now we see that reduction of the share of “shadow business” promotes popularity of business processes outsourcing as an instrument of cost optimization. I believe that results of the study which we are planning to sum up and announce at the end of September will be interesting not only for people who take decisions on transfer to outsourcing, but also for representatives of the public and mass media.
Reference
BDO Group of Companies
BDO Group of Companies is an audit and consulting group with 100% Russian capital operating in the Russian market since 1989. In 2002, it joined BDO Global, one of the largest international organizations in the world, which unites independent audit and consulting firms in 115 countries. Today BDO Group offers its customers overall support in the following fields: audit, tax and legal consulting, financial consulting, management consulting, implementation and support of business applications. Over half of the companies constituting the TOP-100 of the Russian businesses are our customers. Over 2000 people are employed in offices of the group located in all federal regions of the Russian Federation. In 2008, the turnover of the group exceeded 4.1 billion rubles.
BDO Outsourcing Department
The department specializes in outsourcing of business processes in finances and accounting of companies having different types of organization of labor and different organization structures. It was awarded with the first prize in “Outsourcing of financial functions” nomination in the 1st All-Russia Award in outsourcing “Business Atlantes” organized under the auspices of International Association of Outsourcing Professionals (IAOP). We have successful experience in development and implementation of processes of settlements with personnel for outsourcing customers. Around 200 specialists, more than 200 customers. Professional risks are insured in OJSC Insurance Company “Rosno” and in united global system of insurance of professional liability BDO Global.
RBC.Rating
RBC Rating is a rating mass media company. The project proposes regular publication of ratings and rating scores for various branches of economics and business. One of the tasks of the RBC Rating project is to accumulate all information on ratings and rankings devoted to companies, financial organizations and markets in Russia and developed countries. As an on-line project, RBC Rating can create and maintain ratings changing on the real time basis; it gives them special privilege as compared to printed ratings which become outdated already in the process of making-up. RBC Rating is focused not only on the stock market. Customer ratings occupy a special place in the project.
