Why outsourcing doesn’t work! (and when it can).

Are you thinking about outsourcing some of your work to a cheaper market? Perhaps one of the many outsourcing sites? Perhaps to India, the Philippines or Malaysia? As someone who has teams in other countries, I know a thing or two about outsourcing and managing people in remote locations. Outsourcing can be fantastic, but it can also cost you a lot of time and money. Here I explore a few things to consider before you waste time and money outsourcing only to leave yourself disappointed.

Will there be considerable cost savings?

To be honest, probably not. The reason your cost-saving won’t materialise is that you’ll need to spend time training, managing and up-skilling your outsourced person. Why? Because they often don’t have this training or have not worked for an overseas company before. Why will it likely cost you more? It will cost you more because you probably don’t have a training programme, you probably haven’t managed people in a different culture or countries or timezones.

Surely there are some cost savings?

Of course, there are! The direct cost is usually labour. You’ll find each market has different prices. Some have trouble with internet connections, some it’s hard to find the right equipment. If your worker needs a printer, don’t be surprised if they need loads of consumables. Why? Because they’re running a side-hustle; printing documents for friends and family for a few extra dollars. Do you have systems to supervise the person? How do you measure their output? These are all considerations that you need to think about. Jane in the office next door is easy to monitor if she’s watching YouTube all day. Martha thousands of kilometres away, not so easy. Was the issue with her internet connection, or was there a typhoon?

What about the process?

Having clear processes and training programmes are vital to success. I’ve heard many people tell me they hired a virtual assistant only to find they were doing everything themselves anyway. Doing things themselves because the company did not establish a process, or the process was not followed, or it was way too complicated or took too long. This is an issue we’ve had, and it often takes some creative thinking, a bit of sleuthing and time to find out where the problem is. Often instructions that “work just fine here” doesn’t work anywhere else! Not only does this frustrate your virtual assistant, but it also frustrates you and your team here too. All those cost-savings, wasted!

Do they have all the tools or skills?

You can easily see Mary next door struggling with a job. It’s not so easy seeing George struggling in a timezone a few hours behind you late at night when you’re exhausted. Sometimes an offshore team is fantastic, but sometimes, they’re an absolute nightmare, especially when you’re tired. Often you’ll find they don’t know how to do something and won’t voice it. That can be very frustrating. Sometimes they don’t have a tool but don’t know what to ask for. That, too, can be very frustrating.

Checking on completed work

You’ll need to increase your QA (quality assurance) as well. Just as expanding your team at home, it’s easy to miss checking things over as you’ve usually added someone to your team when you absolutely need them, rather than before you need them. Checking over a new staff members work is time-consuming, but doing this remotely can be even harder!

Can outsourcing be a success?

Absolutely, as long as you have sound systems and can manage the challenges. Outsourcing (even locally) can be a big win for saving time and money. Outsourcing can help deliver more skills on an ad hoc basis. You can scale up easier (for contractors that aren’t full time), or it can give you more capacity for a lower per-hour basis. We have had people working for us overseas for a decade, and it’s been great (many are still with us), but it’s also had its challenges.

If you’re looking for cost savings or help to manage your software or e-commerce project or work with an overseas team, have a chat with us. We usually couple local management in New Zealand with management and a solid team overseas to give you the best of both worlds. Less frustration and cost savings.


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