Outsourcing has long been seen as a solution to these challenges, enabling firms to focus on transactions, structuring, and strategic finance while gaining access to specialized expertise, technology infrastructure and economies of scale. However, many now question whether outsourcing is delivering the expected cost savings and operational efficiencies. Service providers have struggled to become a true extension of the fund manager’s finance function, often operating in silos rather than fully integrating into the fund’s operating model. A more functional approach to outsourcing aims to address this by aligning outsourced services more closely with the fund’s strategic and financial objectives, ensuring deeper collaboration and greater long-term value. 

Despite advances in outsourcing, finance functions remain fragmented, weighed down by inefficient process-driven models, unintegrated IT systems, and a focus on compliance rather than performance. As AI and automation increasingly threaten to replace transactional roles, outsourcing must evolve or risk becoming obsolete. 

For years, outsourcing models have primarily focused on transactional processes at the SPV level or have been structured around geographic segmentation, leading to fragmented operations. The dominant approach has been process-based outsourcing, where tasks such as Procure-to-Pay (P2P) or Record-to-Report (R2R) are outsourced in isolation. While this has provided some efficiency gains, it has also resulted in duplicated efforts, inconsistent reporting, and a lack of fund-level oversight. Finance functions remain disconnected, with service providers operating in silos rather than contributing to a cohesive financial strategy. The failure of this approach has highlighted the need for a more integrated and scalable alternative, where outsourcing aligns with the fund’s overall financial objectives rather than being driven by individual SPVs or regional setups.

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