It is not AI vs. Offshoring. How to integrate the two to gain maximum advantage

We are fast moving towards a world where Artificial Intelligence is no longer a “good-to-have” element; it is a “must-have”. Like most other industries, accounting is not an exception. But in accounting, there are other factors to consider – rapid change in compliance needs, persistent shortage of talent, and curated client requirements. Hence, AI, alone will not be able to ensure optimum success. 

AI promises to free accountants of repetitive yet necessary tasks so they can focus on higher-value advisory and analytics work that requires professional judgment. Offshoring takes this a notch further. It can also become your aid in performing more high-value tasks, besides helping you get rid of the repetitive tasks. And that is why the conversation is gradually shifting from “AI or offshoring” to “AI and offshoring”.

But why do firm owners think that these two aspects are pitted against one another? The common questions they ask are: 

• Will AI eliminate the need to offshore?
• If there is automation, why do I need offshoring?
• Should I invest in people or tech? 

To put an end to these concerns once and for all, let us understand why it is important to leverage both of these things.

AI and Offshoring address different things

Offshoring helps you implement AI with ease

AI does sound incredibly exciting. But for a moment, let us think about it from the perspective of a solopreneur or small accounting firm owner. The main problem is that they don’t have the time needed to upgrade their systems; they might not have the capital needed to get a new automation tool or the resources that could be utilized in implementing AI into the existing processes.

The result? They are left behind in the AI race. They continue to struggle with the setup, monitoring of outputs, customizing workflows, training the teams, and integrating with other tools.

That is when you can leverage the offshore teams. The right offshoring partners are often tech agnostic, meaning they can embed into your systems and use the tools that you already use. This relieves you of the added pressure of learning a new tool. Your offshore team becomes instrumental in ensuring nothing falls through the cracks. So instead of your core team spending time wrestling with new tools, they can focus on their performance. 

AI requires smart delegation – this comes with offshoring

While AI continues to be the need of the hour, firm owners and many other professionals continue to be worried about whether AI will replace accountants.

AI won’t replace accountants. But accountants who have learnt to use AI to their maximum advantage will replace the ones who still look at AI as evil. Similarly, firms that deploy offshoring without tech will be at a high risk of being stuck in manual mode. But firms that combine AI and offshoring have the potential to be highly preferred for clients. 

This is how a smart team design should look: 

• Automate everything you can
• Offshore, what you should
• Keep strategic work in-house. Here, you can gain offshore help too if you have a strong team. 

So how do you integrate AI and Offshoring?

Like most other things, this is easier said than done. Creating the right framework that allows accounting firms to successfully integrate AI and offshoring comes in a step-by-step format. Here’s what you can do: 

1. Deep dive into your firm’s workflow and then decide on automation or offshoring:

One of the key challenges that accounting firms face is that they don’t know what they should and can automate and offshore. The reason is that they keep doing work as and when it falls on their plate. But if you have to lay out a strategy that works for you, you have to begin by mapping your workflow. Look at every process – what you are doing, what your team is doing.

Ask: 

• What’s repetitive?
  
• What’s logic-based and automatable?
  
• What needs human oversight or contextual thinking?
  

Once you have found answers to these questions, you will easily be able to figure out what to automate and what to offshore. In the above scenario, use AI tools for the first category, offshore the second, and the third one remains in-house. 

2. Train Your Offshore Team on Your Tech Stack

One of the first things you need to onboard your offshoring team is on your tech stack. Your offshore team is an extension of your in-house team. So they need to own the processes. Preferably, you should look at an offshore partner who already knows your system or can easily embed into it. Having a team that can use the common tools like Dext, Hubdoc, QBO, Xero, Gusto, Canopy, etc, is an advantage. Hire a team who are not just an executioner, but can manage the platforms for you. 

3. Design for Feedback Loops

Accounting is a niche field that deals with heavy, sensitive data. And that is why relying on tools alone isn’t enough. Especially when critical thinking is important. You need a human to close the loop and ensure that all critical situations and exceptions have been addressed. Even with an offshore team, at least initially, you will need to oversee. Your offshore teams should be able to:

• Flag issues in automations
  
• Escalate anomalies
  
• Suggest process improvements
  

The combination of AI and offshoring will work only when there are smart feedback loops in place, and these feedbacks are taken into consideration at the earliest.

4. Scale Thoughtfully, Not Reactively

A lot of times, firm owners start using AI due to peer pressure. Adopting AI or offshoring out of panic is one of the worst things you can do to your business. Your delivery model should focus on long-term goals, instead of short-term ones. Future capacity needs, client expectations and firm growth plans – should be considered seriously before choosing either or both AI and offshoring as a business strategy. 

AI is not your competition. Offshore teams are not your fallback. Together, they’re your multiplier. The right question to ask is “How do we combine both to grow faster, serve better, and work smarter?”

If you’re still thinking in trade-offs, it’s time to reframe the question. AI and offshoring aren’t rival solutions. They’re two sides of the same growth coin. Still unsure about how to leverage offshoring to your advantage? Book a free consultation: https://finsmartaccounting.com/free-consultation/