Should I Offshore?

20 Oct 2016

Should I offshore? That is a question that many businesses will ask when they first read or hear about it. Offshoring brings with it many opportunities for businesses to save money, enhance capability, increase capacity and also empower local employees.

These are just some of the benefits that businesses consider when looking at the potential of an offshore program. Each of these ‘benefits’ or ‘opportunities’ means different things to each business. What’s important to one business might not be so important to another, and this is where the challenge may lie – businesses must carefully consider why they are offshoring and why it’s important for the business to do it.

Getting the why clearly articulated from the start will guide your offshore journey and also assist you in determining how important it is to your business.

  • My competitors are doing it
  • I want to cut costs
  • I want to remove time-consuming tasks from my local employees
  • I want to become more competitive in a global market
  • I want to add capability but local wages make it prohibitive
  • I want to use it as a part of my long-term growth objectives

Those are just some of the reasons you might have when considering whether or not to offshore. Why bring these up? These reasons why you want to offshore will ultimately determine the path of your offshore journey and the results you will achieve from it.

We find that businesses looking to offshore just to cut costs will usually experience issues initially as there is a significant investment in setting up an offshore program for success. Cutting costs is a benefit of offshoring, but it should not be the only focus.

Businesses that are looking to use offshoring to become more competitive empower their local team members, invest in long-term growth and enhance their capabilities, and they realise the true value of an offshore team. Offshore team members can take on labour intensive and process laden tasks like graphic design, website development, accounting, payroll, administration and much more. By doing this, you can free up local resources to undertake value and growth oriented initiatives aimed at maintaining or growing revenues!

Most importantly, one of the biggest considerations your business must consider when looking into offshoring is if you’re ready to commit to it as a long-term strategy. Offshore programs are not short-term projects; they require an investment in planning, strategizing, testing, optimising and implementing. Getting your offshore team ready and then priming it to run on all cylinders will take an investment of time, but once these initial hurdles are overcome, your business will start to realise the benefits.

My business wants to offshore; what next?

Okay, so you’ve done your initial research, you’ve documented your ‘why’ and you know that offshoring can play a role in your business strategy going forward – what’s next?

Well just like you would choose a prefered ice cream flavour, there are many different options – you can set-up your own offshore operation (which is fraught with danger and risk, you can ‘outsource’ certain projects on a case-by-case basis (which could pose security or consistency risks) or you can engage a third-party solutions provider to assist you in mobilising your own offshore team.

An offshore solutions provider will assist your business in navigating the complex international landscape – they have local resources ready to assist you in setting your team up. These resources know the local regulations, legislation and local business environment to ensure the set-up process is a seamless one. They’ll identify the talent, they’ll present this talent to you, they’ll on-board to get your team ready for work and they’ll provide all operational support to ensure your team can perform the task required.

Your ‘why’ matters in selecting the right offshore solutions provider

Getting the right offshore provider to meet your business objectives is critical. Depending on your ‘why,’ you’ll look at different providers with operations in different countries and locations. If your main objective is to cut costs, you might look at the provincial areas of the Philippines like Clark which are located far away from major urban hubs. Although it’s cheaper, you’ll find the talent pool is much smaller and you’ll have difficulty finding highly-skilled candidates. Most importantly, you’ll struggle to build a long-term, high-performance team.

Locations like Makati City and BGC which are based in major metro-hubs are the other option. Although the costs may be higher, if you’re business’ ‘why’ was to grow with highly-skilled candidates and empower your local team members, this might be the location for you.

Metro Manila boasts a diverse and highly-skilled talent pool. Put it this way: your company is based in Australia and you’re looking for talented developers. To get this talent, you’re going to look at recruiting in Sydney or Melbourne.  You won’t find this talent in rural areas like Gladstone or Tamworth. This is comparable to regions like Clark in the Philippines. To get the best talent, you need to engage service providers with a presence in key locations.

Not only that, the employees are highly-engaged and have access to key amenities and infrastructure, similar to what we enjoy in Australia. Why is this important you ask? Well, consider this; to have an engaged team is to have a high performing team – they’ll work harder for you and provide your internal and external stakeholders with great service. They’ll also stick around for much longer, meaning they’ll become critical components in your extended global team.

Okay, I’ve selected my offshore solutions provider, what’s next?

Once you’ve selected a solutions provider, the real journey begins. This provider will work with you and your team from start to finish; from mapping out and refining processes while also answering the questions “what functions should I offshore?” through to identifying and recruiting talent and on-boarding your team.

Your solutions provider will ensure your team members have all operational support – from the set-up and maintenance of their IT needs through to marketing and human resources support. All that is left is for you to manage your team member’s workflow and ensure they’re completing the tasks required.

Your provider will work closely with you to get the best out of your team members. It might seem like a daunting process but, if you’ve selected the right service provider, this process should be seamless. Always remember that getting your offshore team up and away is not a short-term process, there will be teething pains and there will be problems that may arise, but stay committed… you’ll realise the benefits once these are overcome!

By asking yourself “should I offshore,” you will help determine if it becomes a vital part of your business strategy. If you think you are ready for it, drop us a line today to get started.