Having weathered a difficult few years, the shipping sector continues to face many challenges. Ongoing economic uncertainty and conditions are likely to remain volatile for a number of years. However, overall confidence in the industry is reasonably stable and the sense is that “the worst is behind us”.
CEOs and CFOs in the shipping sector need to ensure their businesses are in the best possible shape to capitalise on future opportunities and any industry upturn. This could mean looking for further ways to improve back-office efficiency and reduce costs – exploring new technologies and alternative business models, including the potential for financial outsourcing.
Some preconceptions may need to be jettisoned. Financial outsourcing has moved on from the well-known ‘off-shoring’ models of the past adopted by many larger institutions across a number of sectors. Now much fleeter of foot and tech savvy, some financial outsourcing providers are implementing advanced accounting systems that make the most of cloud-based technologies and enhanced process automation. This not only improves the service provider’s efficiency, but also offers advantages to their shipping clients.
Firstly, new technologies can improve governance and management insight. Cloud-based accounting solutions allow senior executives and finance officers to monitor their company’s financial performance wherever they might be in the world. This enhances their ability to make informed business decisions and maintain effective control.
Secondly, the move to an outsourced model creates the opportunity to automate routine processes while concurrently improving internal systems and controls. This can not only lead to lower overhead costs and follow-on savings in a wide range of administrative areas, but also help to ensure that the business’s assets are accurately recorded and properly safeguarded. The outsourcing model can deliver benefits for all kinds of businesses. However, it is particularly well suited to certain shipping companies where the management team of the business require a lean central administrative function.