Offshoring Pros and Cons

There is a particular immediacy to being aware of offshoring pros and cons. No business venture is perfect as there will always be risks and disadvantages that come with adopting new strategies. Offshoring certainly isn’t exempt from this as there are some characteristics to it that people may not find appealing.

While Diversify does champion the process, we also want to be certain that potential clients know what they will be getting with offshoring. Presenting offshoring pros and cons will aid in making what could be a very important and informed decision that could shape your business in 2017. Although it is often closely associated with outsourcing, there are aspects to offshoring that make it a different process.

Offshoring Pros

The advantages that offshoring brings revolve the massive savings that it brings. However, companies that adapt an offshoring strategy are also made aware of how it promotes better office culture and transparency between yourself and your remote team.

offshoring pros
Offshoring Pros

• Access to a vast, talented pool of candidates.

Offshoring to countries like the Philippines means being able to work with some of the best people they have. The BPO industry in the Philippines is particularly strong, which means that many of their talented people can be found.

• Greater transparency as you manage your team members directly.

The biggest difference between offshoring and outsourcing is choosing the right people for the job. Offshoring functions require a very meticulous process that will result in finding very talented staff members you will work with. You will have direct selection and control of who will come on board with you. A good offshoring provider isn’t content with people who are “good enough” and will go the extra mile to help you find those who can help make your business succeed.

• Employees become long term, value adding members of your team.

Outsourcing is often seen as viable for short-term solutions with staff that can change on a whim. While outsourcing puts more importance on the process, offshoring is much more people oriented. By closely working and engaging with your remote team, they are given a chance to show their skills and how they can help your business grow. This results in having dedicated team members that are loyal to you and your business despite not being there locally.

• You won’t lose control of your data or intellectual property.

Your team members will be operating remotely – they’ll be accessing your server to perform their task; this means they are governed by your local IT security settings and cannot do anything outside of these settings. Diversify also has a range of security protocols in place including no phones in the work area, no local saving functionality and the locking down of certain sites in consultation with you.

• More affordable over the long term.

One major outcome that an offshore team can deliver is assisting your business in growing without expanding your overhead and fixed costs. Outsourcing may seem like the cheaper option between the two but in the long run, offshoring gives your business more bang for its buck as you help cultivate staff members instead of constantly rotating between new ones.

Offshoring Cons

Although a beneficial strategy for businesses, offshoring is something that is not for everyone, especially if you are looking for immediate and short term results. Compared to outsourcing, it takes time to implement an offshoring strategy in order to ensure the quality of service.

offshoring cons
Offshoring Cons

• Implementation usually takes longer than with outsourcing.

This is very particular issue when talking about offshoring pros and cons. Because offshoring requires plenty of managerial and direct control from you, implementing it may take some time. After all, offshoring isn’t a “set and forget” process but rather something that will need your full attention and care. Remember that you not only oversee your staff’s management but their development as well. Ultimately, you need to consider if the juice is worth the squeeze – if you’re looking for short-term gains from an offshore program, this strategy might not be for you.

• You need to provide the business process which ideally requires you to have functional and well-documented process and procedures.

If you have specific requests and objectives from your offshore team, it may require additional training. Your business may not have this luxury or may not want to go through with the process of documenting and refining processes and procedures as it can be arduous. Businesses that need more short term and immediate results may refrain from considering offshoring. It is important to note that undertaking a full assessment of existing processes and procedures can deliver many tangible benefits to your business.

• Service quality remains at the clients’ risk.

When talking about offshoring pros and cons, it often boils down to what clients feel is comfortable for them. It’s understandable that people feel apprehensive about working with an offshore team because of their distance. Most feel comfortable working with local staff as they are easier to reach and the quality of work can be quickly assured. On the other hand, if you believe in the skills of the offshore team that you selected, this may not be a considered a risk.

Overall, offshoring will depend on what objectives you are looking to accomplish. Understanding offshoring pros and cons will then help you know what you need to consider. It may not be what your business needs if you want more immediate results that don’t require your full attention. However, if you see yourself wanting to collaborate with a team that you will develop to function like a well-oiled machine, then offshoring is something to consider.

Interested in getting started? You can drop us a line today to see if you are ready for to take on offshoring.


Your Offshore Team and You

Bringing the best out of the people you see every day can make coming to work plenty of fun and be rewarding for your entire company. This is true whether you are working with your local staff or with an offshore team. As is the case when you start working with new people, there are still a few things that you need to work out initially once you have gotten to know them on your first day.

Closing the distance between you and your offshore team is already an immediate problem that is solved thanks to current technologies. What was once a complicated task, communicating with an offshore team has become a seamless experience that it almost feels like they’re in the same room with you. Regardless of this, there are still a few delicate intricacies that face to face communication brings that you cannot emulate over services like Skype and VSee. It is, therefore, important that you communicate with your team as frequently and as clearly as possible to assign tasks properly, plan your objectives and meet other challenges working with them poses.

Change management

Transition and change are always major issues to discuss in any workplace. Resistance, whether active or passive, should be expected especially if it means talking with your local staff about functions that will potentially be sent to an offshore team. A poor implementation of change strategy may bring uneasiness and uncertainty to your office, which may also result in a number of good staff members leaving for a more stable job.

This highlights the importance of maintaining constant communication and engagement with your offshore team. Everyone that will be affected by changes in management should be communicated with and personalised depending on the level of each staff members. Issues and questions that are raised need be addressed while also giving your staff the floor to be heard as well.

Cultural Differences

When looking to secure an offshore team for your company, cultural differences are bound to arise. Behaviours that are considered norms in Australia may not be the same case for countries in Asia or America and vice versa. From a Filipino point of view, there are some cultural dynamics which are part of our everyday life that while we don’t notice them, foreigners, on the other hand, may be surprised by them. We’ve touched on the significance of being aware of cultural differences previously and it is important to note that aside from this, there are also particular corporate differences you need to also keep in mind.

Corporate culture in Asia puts a much higher premium on respect and understanding within the workplace. In an effort to minimise any confrontation, politeness and clarity are second nature to many people based in Asia so as not to lose face in front of others. This is also especially prevalent in the Philippines, where the concept of being “hiya” or embarrassed is something that is actively avoided. Australian and American workplace cultures have an approach that Asian cultures might feel is too aggressive for them and being unaware of this may cause plenty of friction among your team.

Tempered Expectations

It may sound tempting on the surface to let your offshore team handle a bulk of your functions in order to free up more local opportunities. You want to expect plenty from your team since, after all, they were through a very extensive screening process. However, if you raise your expectations too high for them, the results may not be what you were looking for in the first place.

You need to be aware of what your offshore team can bring to the table as well as potential risks that may come. It is easy to brush away how managing these expectations aren’t a difficult task but it is also an often overlooked one that leads to even more problems that need confronting. Tempered and properly managed expectations not only become beneficial for the company but also further develop the relationship with your offshore team.

Cultivating the right offshore team for your company takes some time, but it becomes incredibly beneficial in the long run. Diversify prides itself in being able to provide highly skilled and dedicated members for your offshoring staff. Drop us a line today if you want to learn more about offshoring.


Why Offshoring Is Like Eating Ice Cream

Whether as a child or as an adult, eating ice cream has always been something to look forward to. People, regardless of their age, find simple joys in those short moments having it especially during summers, as a dessert after meals or as go-to “comfort food.”

So what does it have in common with offshoring?

When you think about it, eating ice cream has many similarities to choosing the best offshoring provider for your company. For one, there are different flavours that many may not be aware of like wasabi or salted caramel. For people that love these particular flavours, they often want to recommend that others try it to dispel preconceived notions about it (“Why would ANYONE want to put salt in their ice cream?”).

In the same way, there are people that may not be aware of the benefits offshoring brings and have only some initial views of it that may be negative. Companies that have adopted offshoring want to let others know how beneficial it can be for them, especially in the long run.

The similarities don’t end there as well.

There are many different flavours to choose from

There are different flavours of ice cream that you can try. There are some big name brands you can choose flavours from or you can get ice cream from a smaller, more local outlet. Just like selecting your preferred flavour, there are many different offshoring providers that you can choose from. Each of them provides different roles and functions for your company.

Ask yourself what you want

When you’re about to buy ice cream, you ask yourself questions like “Do I want my choice to go with anything else?” or “Am I in the mood for something fancy like Rocky Road or do I just want simple like plain vanilla?”

The same works for offshoring. What your business is looking to get accomplished will also depend on the offshoring provider you need. If your company requires plenty of back office functions that need to be offshored, it is encouraged that you seek out more complete providers rather than cheap ones.

There is always a preferred spot to go to for ice cream

You make it a point to always go to your favourite spot for ice cream even if there are other places that offer the same flavour. Maybe you get along with staff that serves you and often want to engage in conversation with them. You may also find a particular location much closer to you than other branches, making it more convenient and accessible to you.

This is why location matters in offshoring. Even if you manage to choose a provider that offers the functions that you need, it is also essential to note where they are based as they can be a much better option for you. Offshore staff in the Philippines for instance are very articulate English speakers compared to other countries and are much easier to get a hold of due to minimal time zone differences.

It doesn’t matter if you want ice cream in a cup or cone. Everyone can have it

Historically, ice cream was once considered a very costly dessert that only wealthy people could have. By the early 20th century however, ice cream became less expensive and was starting to be sold by street vendors and at fairs. With the advent of cones sometime in the 1920s, ice cream became a very accessible dessert to more people. While there were still those that preferred to have it in a dish or cup rather than a cone, ice cream was now no longer limited to just being eaten on one platform by a select group of people.

One of the biggest concerns people have about offshoring is its cost and that it is only something that bigger, more established companies can afford. While this was true for awhile, current technologies and faster Internet speeds have made it possible for small and medium business owners to make offshoring work for their company. No longer limited to just big businesses, offshoring can now be embraced by any business of size in the world.

Premium ice cream is available too

Of course, if you’re looking for something that will provide you with the biggest satisfaction, ice cream companies have different premium flavours available. While they may cost more than average or cheaper ice cream, you know that what you are paying for an extra “kick” or richness in flavour that these companies want to guarantee you will have.

Diversify is an offshoring company that is just like a premium ice cream flavour. We’re not content with providing you just average services or very basic staff members. We want our clients to be highly satisfied with the services we offer. With a premium standard that great, it means we are committed to hiring the best and brightest for your offshoring staff and offering top quality services at the best rates. If these are the services that you want out of an offshoring company, feel free to reach out to us so we can help you get started.


The key ingredients for successful offshoring

Planning

For any major project to work well, it is very important that it fits in with the business’ overall strategic plan and is well thought through. Offshoring initiatives need to be driven top down through the business if they are to be truly embraced and the potential benefits fully realised.

Pilot

Those businesses considering using offshore labour for the first time should consider first running a pilot program to fully understand the considerations which will arise. To have an effective pilot program, it is important to document at the outset what success will look like, agree how long the pilot program will run for and fully review and evaluate the results of the pilot once completed. Incorporating the learnings from the pilot program into future plans will be very beneficial.

What to start with?

It is best to start offshoring with simple internally facing functions. Ideally, functions that will free up existing bottlenecks or otherwise make life easier for your current staff will help greatly with staff buy-in. Initially, avoid client facing functions as you want to ensure that things are running very smoothly and that you have thought through you clients’ likely reactions before you make the decision to expose them directly to your offshore team. Marketing and accounting support roles are easy ones to begin with, some examples of roles to consider beginning with might include data entry, bookkeeping, paralegal support, graphic design and search engine optimisation.

Staff Communication

Once you have made the decision to use offshore staff, you need to consider how you will communicate this to your local team. In the absence of any formal communication, they will assume the worst and this may lead to local staffing issues. If you don’t plan to make any local staff redundant but are merely looking to add resource and replace people as they leave through natural attrition, you should let your staff know. Even if you are planning to make staff redundant, letting everyone know in advance who is likely to be affected and who isn’t will help a lot with your internal change management.

Take your time

The most important thing of all when thinking about moving to engage staff offshore is to take your time. There will almost certainly be issues which will arise and by starting small and growing as you learn, you will minimise any likely impact and allow you the time understand how to make offshoring work for your business. In addition, you should let your staff know from the outset that there will be teething issues and ask for their patience in working these through. Expectation management is very important to ensure that they give you the time to make the offshore staff strategy work for your business.

Treat your offshore team the same way you would treat your local team.


What can my business offshore or outsource?

Business owners who have considered offshoring or outsourcing in the past, or have had a poor experience with it, are no doubt curious as to how other businesses have made it work so well. This is particularly so now with the development and uptake of cloud-based technology has made it easier than ever for businesses to develop, implement and effectively manage an outsourced or offshored workforce.

The rapid development of technology, increasing sophistication of offshore and outsourced service providers and availability of different delivery options mean that businesses can now select a solution tailored to their specific needs. Although having a wide selection of service providers and a variety of service delivery options is great for businesses, it may actually create uncertainty around what option may work for them and what functions can and should be outsourced or offshored.

The success or failure of an offshore or outsourced workforce depends on a business having a good idea on what components of their business can be successfully completed offshore. Many of the stories of an unsuccessful implementation stem around businesses trying to offshore roles that should be maintained locally or trying to roll out an offshore or outsourced workforce too quickly. Either of these scenarios will likely result in failure. Understanding that not everything can be offshored or outsourced is critical to success followed by a measured, strategic and project-based roll out.

This poses the question as to what can your business effectively offshore or outsource.

A key element in the planning stage is how to strategically select which roles to outsource or offshore. The best way to start this approach is to consider the functions that are important, but not critical elements to a business’ success. These are usually core roles that support the more critical functions of the business. Examples of roles that can (and have) been successfully offshored or outsourced include:

Administrative Services

Virtual assistants are capable of handling routine administrative tasks such as checking and answering emails daily, managing a director’s personal schedule, organising and managing a database, travel arrangements, data entry and documentation.

Customer Support

Offshoring or outsourcing of customer support has been occurring for over a decade. Many large organisations have been using offshored or outsourced workforces to provide customer service in the form of phone or online support. A major benefit of offshoring or outsourcing customer support is the increasing importance of being responsive to customer queries on a 24/7 basis.

A number of US-based companies have transferred some of their customer support responsibilities to different outsourcing companies like those in the Philippines, where employees have a high proficiency in American English.

Accounting Solutions

Most, if not, all companies require assistance in accounting or finance. Whether it is for recording financial statements, payroll, bookkeeping and other accounting tasks. Businesses, especially start-ups, tend to neglect this task as they are focused on running their core operations. As a result, they end up struggling to keep up with compliance requirements when they are about to undergo auditing. This is where outsourcing comes to the rescue.

Creative Solutions

Businesses outsource or offshore their visual and content requirements for branding. This includes graphic design for both offline and online marketing purposes. This can include logos, banners, flyers, brochures, magazines, and posters. Creative solutions also include content development such as blogs, articles for press releases, scripts, and web content.

Legal Process Services

Law firms have been utilizing offshore and outsourced resources to reduce the administrative burden on local resources. Tasks that can be undertaken offshore include simple documentation development, precedent and workflow development, legal research, word processing, and data entry.

Marketing Support

Businesses have ventured on to boosting their marketing efforts through outsourcing, especially in the digital marketing field. Executing search engine optimisation activities, rolling out email marketing campaigns, social media management and online advertising are just a few of the marketing support services that can be offshored or outsourced.

Outsourcing and offshoring can be an effective way to grow your business and increase competitiveness in your industry.

Although this is the case, it is important to understand that there is no ‘one size fits all’ way of doing so. Diving into the process without investing any time or effort in determining what you can offshore or outsource will result in a less than desirable result.

A measured, strategic and planned approach to offshoring and outsourcing will provide positive results. Start small and identify roles that can easily be offshored. Achieve success, secure organizational buy-ins and then scale-up as your understanding and knowledge base increases. This is the benefit Diversify provides. We work with you right from the beginning in growing your understanding before you jump in.

It is important to remember that the tasks you should consider outsourcing may vary depending on your industry. For companies planning to use offshore labour, it is advisable not to pass on tasks that are highly critical to the company’s main strategy, especially at the start. Create a plan, budget the costs and document what success will look like before embarking upon your outsourcing or offshoring journey.