Why Offshoring is Like Hiring Locally (But Better)

27 Nov 2017

A recent survey done on the state of offshoring in Australia highlighted the quality of work produced by offshore teams. It also delved on the issue of staff turnover and how much savings were experienced by companies that offshored. The survey concluded that while hiring an offshore team is no different from hiring locally, companies that do experience better benefits.

The Quality of Work Provided by Offshore Teams

57% of the respondents believed that turnover between local and offshore teams were similar. This was mostly in part due to strong offshoring programs that create engaged and involved employees. Rather than being just another team working overseas, they’ve become long-term team members that syncs well with the local workforce.

Turnover is similar
Local turnover is greater
Offshore team turnover is greater

Offshore teams are an extension of the local workforce

The respondents also debunked the common misconception of the quality of work provided offshore labour. More businesses are realising the real value provided by skilled workers from offshore locations like the Philippines, making them comparable to local labour. 64.86% of respondents called the work provided by offshore teams “comparable” to local labour, a figure that is likely to increase in the coming years.

Comparable to local labour
Inferior to local labour
Superior to local labour

The quality of work remains the same

Different factors can attest to this. Easier digital communication has traditionally inaccessible roles to now be accessed. Companies are also acknowledging the skills high literacy rate in the Philippines. These companies are now hiring workers with the same qualifications as local workers.

Cost savings from offshoring is the most common reason companies have adopted it. According to the survey, there is a unanimous response to the “significant” savings it brings to companies. For them, if cost savings were not possible or significant, offshoring would not be viable. Over 70% of respondents say they had achieved significant cost savings.

Realised significant cost savings
No cost savings

Offshoring always brings big savings

Although these savings were not immediately recognized in the first few months of implementation, it brought about great returns once it did.

Big Savings with Offshoring

The correlation of cost savings, quality of work and low staff turnover show how efficient offshoring is. With nearly similar impact and approach to hiring locally, adopting an offshoring strategy brings big savings without sacrificing the quality of work.

Offshoring continues to be favored by more businesses for its cost saving strategies that do not affect the quality of work produced. Download the report on the State of Offshoring in Australia today to learn more.