The top 7 reasons why outsourced teams fail

The top 7 reasons why outsourced teams fail
Nick Ogden
Nick Ogden
    5 minute read

There’s plenty of information out there about how great Philippines based outsourcing is and the positive benefits it can have on your businesses. If you haven’t heard the latest about outsourcing to the Philippines, then Google it or jump on Beepo’s blog. But, the outsourcing successes are only half the story. If you look at the entire outsourcing industry, we know that, anecdotally, 50% of businesses who try outsourcing fail in finding any business benefits. But why does this happen when the other 50% reap great rewards from going offshore with Philippines-based real estate virtual assistants?

In this article we have compiled the top seven reasons why outsourced teams fail.

  1. Superhero

    When you start to think about the cost-savings associated with an outsourced team, I wouldn’t blame you for getting really excited - and for good reason - you can hire someone in the Philippines at about 30% of what it would cost you in a country like Australia or the U.S.. The trick here is not to get carried away with that savings to the point where you look for even more savings by cramming as many unrelated tasks as possible into one job description. The labour market in the Philippines is similar to many western countries i.e. if you don’t think you can find someone who can do the job in Australia, the US or the UK what makes you think you could find this person The Philippines?

    I remember talking to a customer years ago when I first started at Beepo. We were scoping out a marketing position for their business and trying to nail down the tasks that position would be responsible for. The list included things like managing social media posting plans, loading lists for email campaigns, and pulling together reports on marketing analytics. I thought to myself, ‘This is great! What a perfect digital marketing position’. Then the customer turns to me and asks:

    ‘Do you reckon we could find someone who could do all this and do graphic design as well’?

    This combination requires two completely different skill sets and you’d struggle to hire a person that can do this in Australia or the U.S.; so why would you think you’d be able to hire someone like this in The Philippines? We call this Job role “The Superhero”, because that’s what you’d need to be to fill the position.

    I like superhero movies as much as the next person, but unfortunately they are fictitious. Superheroes don’t exist in Australia, or the Philippines, or anywhere!

  2. It’s true because it is in the resume

    Often when you engage with an outsourcing provider you can choose to participate in the recruitment process, so you can screen resumes, interview candidates etc. If you are faced with recruiting your own offshore employee (whether it be on a project basis, home-based or office-based) don’t take what’s on the resume as gospel. We learnt very early on that basic aptitude testing and job specific testing was crucial in candidate selection.

    A few years ago, I interviewed a candidate for a Team Leader role and they had on their resume that they were Six Sigma Qualified. Although I am not Six Sigma trained, I am a former Business Analyst and am very familiar with the methodology. Basically, there are 4 certification levels - Yellow belt, Green belt, Black belt and Master Black belt. So I asked the candidate what level of Six Sigma training had he attained? He straight out told me ‘Blue Belt’. Needless to say he didn’t get the job.

    I should say that after all my time working with a Filipino team, I’ve come to understand they have different motivators and drivers. The Philippines is classed as a ‘developing’ country and as such many of the people who live there have very different day to day struggles to us. It is always useful to keep this in mind when working across borders and cultures.

  3. Yes = ?

    One thing Australians are well known for is our blunt communication style. Culturally, we’re not backward in coming forward. The downside is we expect everyone else to be like this. The simple truth is not everyone is.

    You would think that ‘yes’ and ‘no’ are pretty straightforward words with one meaning each. This is mostly the case, but in The Philippines people are generally very grateful for a job and never want to disappoint their boss. So if you ask your Filipino staff member if they understand something often they will say ‘Yes’, but not really mean it; this is the “passive yes”. This means they do not fully understand what you want, or may have some questions; but, think it a poor reflection upon themselves if they ask for help - so they don’t. There are two lessons in this:

    • Try not to ask closed questions;
    • Always check for understanding.
  4. No feedback

    During my time working with cross cultural teams I have learnt that Australians are generally terrible people managers. We don’t manage people to tasks and I’ve rarely come across an Australian manager who has a framework they use when managing teams. On the other hand, I have found Filipinos love being managed through feedback, KPIs and other performance measures. This means the idea of building an offshore team and then putting them on ‘set-and-forget’ is doomed to fail.

    To address this, make sure you:

    • Implement a reliable, repeatable management framework that your whole team understands and uses;
    • Develop SMART KPIs and performance measures for your Philippines team;
    • Check-in regularly with your outsourced team to assess task progress and offer your assistance when needed;
    • Do whatever it takes to make your outsourced team feel part of your business.
  5. The time poor entrepreneur

    If you read point four then you should understand that managing an Outsourced Team takes time and you will need to shuffle some resources around to properly integrate local and outsourced teams. With this in mind, if you are flying solo and in the start up stage, you will need to find the time to manage your outsourced team effectively. This may mean giving up some of the day-to-day work that is bogging you down, giving away some control, or hiring someone in Australia or the U.S. to look after operations and your outsourced team while you grow the business.

  6. Technology

    At work, we practice what we preach. Our Australian team works remotely, and we’re all 100% comfortable using web conferencing to meet with each other and the growing team in The Philippines. It is today’s technology that has made Philippines-based outsourcing such an effective option for businesses. Your computer probably already has everything you need to work with remote teams. All you need is a webcam, headset and web conferencing software; all of which is inexpensive and easy to set up. From a tech point of view, the only thing stopping you from running an offshore team is a closed mind.

  7. Process

    Having well-documented processes is a must have for building an effective outsourced team. This is always a massive sticking point for many agency owners considering outsourcing. That is why it is especially important to go with a real estate focussed outsourcing provider. Beepo already has staff ready to be placed as well as trained in industry-best practice across all appropriate aspects of property management, sales, marketing and accounting.

Are you after more information on how Beepo can help you in your outsourcing journey? Take a look at our Outsourcing toolkit part one to find out everything you need to know on how to get started.

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