Enterprises have expanded their outsourcing of finance and accounting operations while demanding more specialized capabilities from providers, according to a new research report published today by Information Services Group (ISG) (Nasdaq: III), a leading global technology research and advisory firm.

The 2024 ISG Provider Lens™ global Finance and Accounting Outsourcing (FAO) Services report finds a growing number of companies are interested in comprehensive sets of services that go beyond traditional outsourcing. They want providers to integrate advanced analytics, strategic consulting and industry-specific expertise into solutions that streamline financial processes and are tailored to clients’ needs.

“Finance and accounting require complete digital transformation to optimize processes and improve data accuracy,” said Robert Stapleton, ISG partner, Business Outsourcing Services. “Service providers are adding advanced tools and industry-specific expertise to help clients grow and achieve operational excellence.”

Enterprises are turning to providers for holistic orchestration capabilities that support unified user experiences, real-time insights and data-driven strategies for higher efficiency and better decision-making, ISG says. Companies also want providers to offer insight into their industry’s best practices, compliance issues and market trends, along with solutions that meet industry requirements.

AI, machine learning, robotic process automation (RPA) and cloud computing are significantly changing finance and accounting processes, making them more efficient and accurate through real-time data analytics, the report says. Generative AI (GenAI) has strong potential to improve data analysis and planning, though most GenAI applications in this field are still in the proof-of-concept stage. If FAO services, SaaS and finance platform providers collaborate more closely, the GenAI trend may accelerate.

The most commonly outsourced financial process is still procure to pay (P2P), but many enterprises are outsourcing more advanced functions, such as record-to-report (R2R) and financial planning and analysis (FP&A), ISG says. AI and advanced analytics are revolutionizing these functions, changing how companies create budgets, forecasts and financial statements.

“Companies are automating R2R with the help of service providers and dramatically reducing manual effort,” said Jan Erik Aase, partner and global leader, ISG Provider Lens Research. “This shortens their closing cycles and cuts down on errors.”

Consulting and advisory services are becoming central to FAO engagements as more clients embrace complex technologies such as ERP and cloud solutions, ISG says. Providers are also expanding services around environmental, social and governance (ESG) practices and sustainability reporting, though companies have adopted these more slowly, mostly driven by regulatory demands.

The report also explores other FAO services trends, including the increasing use of outcome-based models in FAO contracts and co-innovation between providers and clients.

For more insights into the finance and accounting challenges enterprises face, including a shortage of skilled resources, plus ISG’s advice on how to address these issues, see the ISG Provider Lens™ Focal Points briefing here.

The 2024 ISG Provider Lens™ global Finance and Accounting Outsourcing (FAO) Services report evaluates the capabilities of 31 providers across four quadrants: Procure to Pay (P2P), Order to Cash (O2C), Record to Report (R2R) and Financial Planning and Analysis (FP&A).

The report names Accenture, Capgemini, Cognizant, Deloitte, EXL, Genpact, HCLTech, IBM, Infosys, TCS, Wipro and WNS as Leaders in all four quadrants. It names Sutherland as a Leader in two quadrants and Tech Mahindra as a Leader in one quadrant.

In addition, Datamatics, Tech Mahindra and Teleperformance are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.

In the area of customer experience, Accenture is named the global ISG CX Star Performer for 2024 among FAO services providers. Accenture earned the highest customer satisfaction scores in ISG's Voice of the Customer survey, part of the ISG Star of Excellence™ program, the premier quality recognition for the technology and business services industry.

Customized versions of the report are available from Auxis, Capgemini, Cognizant, HCLTech, Infosys, Wipro and WNS.

The 2024 ISG Provider Lens™ global Finance and Accounting Outsourcing (FAO) Services report is available to subscribers or for one-time purchase on this webpage.

About ISG Provider Lens™ Research

The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across Europe, as well as in the U.S., Canada, Mexico, Brazil, the U.K., France, Benelux, Germany, Switzerland, the Nordics, Australia and Singapore/Malaysia, with additional markets to be added in the future. For more information about ISG Provider Lens research, please visit this webpage.

About ISG

ISG (Information Services Group) (Nasdaq: III) is a leading global technology research and advisory firm. A trusted business partner to more than 900 clients, including more than 75 of the world’s top 100 enterprises, ISG is committed to helping corporations, public sector organizations, and service and technology providers achieve operational excellence and faster growth. The firm specializes in digital transformation services, including AI and automation, cloud and data analytics; sourcing advisory; managed governance and risk services; network carrier services; strategy and operations design; change management; market intelligence and technology research and analysis. Founded in 2006, and based in Stamford, Conn., ISG employs more than 1,600 digital-ready professionals operating in more than 20 countries—a global team known for its innovative thinking, market influence, deep industry and technology expertise, and world-class research and analytical capabilities based on the industry’s most comprehensive marketplace data. For more information, visit www.isg-one.com.

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