There are some interesting innovation competitions out there and the industry has really developed with online companies such as Innocentive, and IdeaConnection , these business models effectively crowdsource solutions to commercial problems and they prove to be lucrative for both parties involved, the client gets cheap R & D and the innovator wins cash and recognition.

Another interesting permutation of this growing trend to crowdsource is the area of online freelancers; one of the leaders in this industry is Elance. Elance is one of the surprising success stories to emerge from the financial turmoil of the Lehman AIG (read Age). Clients post online details of their project requirements, usually in the programming, design or marketing field and professionals tender for these projects making their track record and customer satisfaction ratings available to the client.

From a management accounting perspective it’s easy to see why this industry has taken off in tough times, managers are eager to trim fixed overheads so culling non-core departments is a favourite target and a contracting economy is simultaneously shedding experienced professionals able to perform these non-core functions, so supply meets demand, companies like Elance make the low-cost match and voile, an industry is born.

Elance have been asking the question "What is the new way to work", obviously they would like the answer to be, online freelancing, which is the model which they are applying to several geographically flexible industries, I would like to attempt an answer for a field that traditionally is very much insourced, management accounting.

Let me indulge you with a role play, factory owner Jimmy is debating replacing his aging machinery, he has 4 options, rent, buy, finance or push it till it breaks, what does he do? This may look like an exam question, which it indeed could be, but it’s a real problem that a competent management accountant has the tools to address.

Jimmy posts his dilemma with a list of documentation available for decision making, he states the price range he’s prepared to pay for the service and awaits proposals.

Young smart underemployed management accountant Andrew, looks at this post and says "hey, I can do that, and I could use the cash" Andrew submits his proposal, Jimmy likes his approach, they agree on payment terms and deliverables and a management tool is born.

Jimmy benefits by not needing to employ a full time management accountant but still has the expertise available and Andrew spent a few nights after work earning some extra cash for his weekend getaway.

…so is this a potential new management tool? Could businesses outsource operational decisions? There’s a long list of advantages and disadvantages to a model like this but I believe the niche exists, at the risk of bastardizing another prefix; we could be looking at a new field called micro-consulting or for those who prefer processing information graphically, the long tail of management accounting.

My major detractor on the subject is the conservative genie on my right shoulder telling me that if this was a profitable model it would have already been implemented but my hip2B² left shoulder genie tells me that the market may not have been cost conscious enough in the past for the model to ignite but perhaps CFO’s with post-market-meltdown-stress-disorder may now be willing to entertain new cost saving opportunities.

I believe with the correct implementation this long tail could start wagging, so if you’re a budding management accountant cum entrepreneur consider this idea as free advice, but as my standard caveat on free advice goes. "You get what you pay for".