Common Offshoring Mistakes and How To Avoid Them

21 May 2018

Like any business strategy, offshoring is not without its challenges and issues. If applied incorrectly, offshoring can result in a negative experience, with companies not realizing what it can fully do. Many horror stories surrounding offshoring mistakes often come as a result of mismanagement or insufficient knowledge about what it does. Awhile back we looked at some common offshoring mistakes that companies often make. Since then, we’ve seen some improvement in some aspects, while also noticing new concerns that should be addressed.

Avoiding Common Offshoring Mistakes

The offshoring of key functions to reliable providers continues to show itself as a proven business strategy. Companies see the real value of sending functions of all levels to teams that they are wholly responsible for. Getting an idea, therefore, of what offshoring means is also being aware of the limitations it can create. Many of these may sound obvious but even some very established companies have overlooked some of these factors on occasion.

Overlooking Due Diligence

Due diligence is important for any professional collaboration, not just with offshoring. Your grand ideas and visions for a more global presence can certainly be helped with an offshore team. However, without making due diligence checks on potential providers, this can have more negative consequences before you even get started.

Companies that want to offshore need to maintain a level of diligence when they consider their provider. No matter how confident companies might be in the integrity and output of their chosen provider, they still need to conduct due diligence to see if they are indeed up to the standards they have set for themselves. From the quality of talent to their chosen location’s infrastructure, due diligence is an indispensable part of the offshoring process. Once in place, companies can begin to look at other factors that could affect their offshoring experience.

Impatience with Implementation

Offshoring’s unique cost saving approach is what many businesses consider its greatest benefit. So much so that some companies want their strategies to get off the ground as soon as possible. However, doing so many increase risks and could become a very costly endeavor in the longer term.

The reality is that offshoring is not something that can happen overnight. We’ve talked about how businesses need to be patient with the offshoring process. It will require a deep commitment that will cover the professional and personal development of your offshore team. In fact, we believe that it takes companies at least a year to see what offshoring can truly do.

Before any company undertakes an offshoring strategy, they need to ask themselves if they are ready for the long haul.

Not Prioritizing Visibility

One of the clear differences offshoring has from something like outsourcing and freelance work is in collaboration. Your offshore team acts as an extension of your local team and is as vital to your success as they are.

Unfortunately, this is still something that is overlooked. Offshore teams are sometimes seen as a group of people working abroad at a lowered cost. They are not closely involved in the company’s strategies and are only engaged with when needed.

This is why it is important that all teams – local and offshore – are kept in the loop on daily operations. Doing so develops team engagement, which is important if you want to achieve success on a global platform. Leaving your offshore team in the dark may cause a drop in production, affecting your company’s overall morale.

Unclear Roles and Responsibilities

It’s often challenging for businesses that offshore for the first time to make a seamless transition into it. What offshoring covers can lead to confusion from people not knowing what their future roles will be. You may have an idea of what roles you are looking to offshore, but your team may not fully grasp the scale of their new responsibilities.

Clearly defining roles will lead to a much stronger working relationship with your offshore team.

This doesn’t just mean your offshore team. Your local team will also be affected by the transition period. If they are not aware of their new responsibilities and collaborations, something as simple as time zones could lead to some initial problems. Good offshoring providers stress the importance of clearly defining roles and working with a set timetable to make sure everyone operates on the same wavelength.

A Lack of Proper Strategy

We’ve made it clear that offshoring is a major business decision that needs to be seriously considered. Given this, a lack of strategy or proper management will result in major consequences. Companies that adapt offshoring without looking at its lasting effects can have a negative on the objectives and responsibilities it set for itself. When properly adapted, a good offshoring strategy will give everyone ample time to prepare for changes, whether major or minor, that are about to happen.

This leads back also to proper management. Even if they are not present locally, you will not get the most out of your offshore team without ongoing management. Sure, it might feel that the work itself might be out of your hands locally, which can lead to some concern. Through proper and consistent management however, companies not only can rely on their offshoring provider, but they also help build stronger working relationships between teams. As we stated earlier, the work that offshore teams do should not be seen as less important in spite of being located in another country.

Collaborating with the right provider

Whatever the size of your business is, there’s an offshoring strategy that’s ready for you. Committing to a major decision like offshoring can seem difficult, but the right providers know how to make it a seamless transition for everyone involved. By being aware of the common mistakes surrounding offshoring’s implementation, you also get an idea of how to ensure you are getting the most out of your teams. As one of the leading offshoring providers in the Philippines, Diversify is committed to ensuring that all current and future clients avoid making common offshoring mistakes that have plagued others.

Want to start your offshoring journey today? Contact us now to get started.