Financial Services Present Risk Assessment and Global Outsourcing Challenges

The tremendous global growth that is occurring at present, has presented the financial sector with yet another issue: How to successfully manage and assess the risks associated with sourcing activity on a global scale.

Until the recent expansion of the financial industry in the global arena, the issues most often associated with risk assessment were in-house functions; strategic, operational, financial and regulatory risks were often difficult to accurately assess, but they were operating under the watchful eye of the CEO and CFO. Today, the situation has begun to evolve into a much more difficult and complex issue.

Manufacturing sourcing that began more than a decade prior, has given the industry the opportunity to create, implement and manage their sourcing operations on a much smaller scale. This has provided manufacturing with the opportunity to mature into the global arena.

KPMG, among other financial firms that are expanding and operating in global markets, published a study that examined the challenges facing the financial sector in the emergence of risk assessment for sourcing needs.

The most difficult task seems to be the financial organizations inability to maintain a clear vision of the end-to-end service and delivery processes. In the financial industry, accountability and verification of information is now a regulatory must. The challenge of managing a supply chain that crosses many geographical boundaries and cultural borders is proving to be a tremendous responsibility, and one that is even more difficult to integrate and manage for a seamless delivery.

The competitive advantage afforded the organizations that can effectively operate, while utilizing sourcing options, boosts shareholder value and allows the financial sector to capitalize on the high-quality skills in lower cost markets. Creating the sourcing procedure needed to assure that quality and competitive costs are equally maintained will be the greatest challenge faced by the financial industry as well as the Big4 Accounting firms.