When it comes to embracing change, the Business Process Outsourcing (BPO) industry has long prided itself on its ability to adapt and evolve. Despite the impact of COVID, the global BPO industry’s market value is expected to reach U.S. $620 billion by 2032, with a compound annual growth rate (CAGR) of 8.5%.
If you are interested in capitalising on this growth by introducing outsourcing into your business, this blog will take you through the myths surrounding outsourcing, how it works and what impact outsourcing could have on your business.
What is outsourcing?
Outsourcing provides opportunities for your local onshore team to focus on important, value adding tasks that make a real difference to your bottom line. Outsourcing to the Philippines is a strategy that involves hiring a Philippines-based team member who is 100% dedicated to your business, to support your local team in whatever capacity they require. The following video will give you a little insight into the benefits that outsourcing offers:
The myths around outsourcing
Hiring offshore talent has never been easier, but many business owners are still uneasy with the concept and some of the perceived risks involved. As a result, there are some key myths surrounding the offshore outsourcing industry which we explore below:
Myth 1: Outsourced employees have poor English skills
There are many concerns around offshore staff having an accent or having difficulty communicating. This is what makes the Philippines an ideal outsourcing location. English, along with Filipino, are the two official languages in the Philippines.
Generally speaking, the vast majority of Filipinos are fluent in English. Both Filipino and English are used in government, education, print, broadcast media and business which is why the Philippines is one of the largest English speaking countries in the world.
Myth 2: Data security and privacy could be at risk
There is a fear that if outsourced employees have access to important business information, there is an increased security risk to the business. This is where choosing the right provider is important. Data management and information security are important factors to explore when outsourcing to the Philippines. Given the current tightening of regulations surrounding data security, privacy and information management, these concerns are real and legitimate.
Be sure to choose an outsourcing provider that takes data security seriously and look for things like external entrance security, biometric devices, swipe cards and cloud-based program access. Ensure that your provider takes all necessary measures to ensure no employees have access to their mobile phones or any USB/hard drive while they are in the operations rooms. If your prospective provider operates a work from home model - make sure you have them detail their standard data security protocols in this particular setting.
Myth 3: Current staff may feel threatened
If your outsourcing strategy is created and implemented properly, your existing staff will have nothing to worry about and everything to look forward to. There is a common misconception that outsourcing will take jobs away from your local team.
This is simply not true. In most cases, offshore staff handle the repetitive, process-driven tasks so that your local staff can focus on value adding tasks to help your business grow. Instead of eliminating local positions, outsourcing allows your existing team to do more of the tasks they enjoy doing. This will result in increased staff satisfaction and retention.
Myth 4: Quality standards could be compromised
To ensure that the quality of the work provided is of a high standard, it’s essential to develop a long term successful relationship with offshore employees. This starts with the recruitment process. There must be rigorous testing to determine that the employee has the skills to perform the inherent responsibilities of the role. However, it doesn’t stop at recruitment.
Even the most competent employee requires support and training to ensure that they are developed into the role. This is where finding the right provider again becomes important. They will work with your business to ensure that appropriate training and support is provided. They can also offer a buddy system for new employees with existing high performing staff. Where applicable, they can help establish quality checking of work so that errors are picked up quickly and feedback and coaching is provided.
Myth 5: It isn’t ethical
Many business owners are concerned about the significant cost difference between local and offshore teams. There is an ethical concern that they are taking advantage of people in developing countries. The cost of living in the Philippines is 70% less than in Australia.
This means that wages for offshore staff will naturally be less than average Australian wages. To ensure your offshore staff are being looked after, choose a provider that will ensure a fair and reasonable pay structure with the right employee benefits.
Learn more about the misconceptions of outsourcing to the Philippines in our free downloadable ‘The Truths Behind Outsourcing to the Philippines’.
How does outsourcing work?
We often see businesses outsource high volume, repeatable tasks so that their onshore employees have the time to focus on the value adding, income generating tasks such as strategic projects, nurturing client relationships, closing deals and so on. However your offshore staff can support your business in whatever capacity you require.
Contrary to how some people view outsourcing, it doesn’t take local jobs away. In fact, outsourcing supports you and your current team to build a stronger, more viable business - it helps you add value to your product offering and can assist your business in improving customer experience.
There is a vast array of roles and tasks suitable for outsourcing in all industries such as:
Tools to assist you in your outsourcing journey
The following applications are tools we have used and recommend using in order to reap as many benefits from outsourcing as possible. There are many tools that can support an effective operation - these are just a few of our favourite communication and training tools.
- Skype: a telecommunications application that specialises in providing video chat and voice calls between computers, tablets and mobile devices via the internet.
- Zoom: offers communications software combining video conferencing, online meetings, chat and mobile collaboration.
- Snagit: a screenshot program that captures video display and audio output.
- Trello: a web-based list-making application. Trello keeps track of everything, from the big picture to the minute details.
- JIRA: a proprietary issue tracking product that allows bug tracking and agile project management.
The impact of outsourcing on your business
There comes a time for most businesses where they struggle to scale and grow, and with wages increasing, margins are starting to shrink even further.
Business owners are looking for strategies that will enable them to grow without cost-prohibitive overheads - which is often the primary reason they engage in outsourcing. Some of the primary benefits of outsourcing include:
Outsourcing allows additional work to be completed, at significantly reduced costs, especially when outsourcing offshore to a lower cost economy, such as the Philippines, where employment costs are up to 70% less. Hiring new staff is an expensive process.
Beepo’s outsourcing model takes care of all these costs including recruitment, human resources, new office equipment, superannuation, payroll tax, workers compensation, IT and overall management supervision. Apart from the engagement costs, you would only be sacrificing your time to train your new employees, which is a long-term investment for your business.
One of the many reasons businesses struggle to grow is a lack of funds to invest in additional resources to support growth objectives. Businesses often don't have the time to recruit a new employee to leverage potential growth opportunities. On top of this, there are businesses that go through peak periods where there is too much work and then times when there isn’t as much. Outsourcing provides scalability during these times.
There is often a very short lead time to hiring offshore, providing a further advantage in that it can be very quick to scale up a business, depending on the role type. Outsourcing can also free up funds that can be used to reinvest back into the growth of your business. With the additional support of outsourced team member(s), you can increase the capacity for your business to take on more work.
Increased staff satisfaction
Outsourcing can help you to identify roles and tasks that would be best suited to send to an offshore employee. That way, your local team can focus on what they do best and what motivates them, improving job satisfaction for employees in the long run.
Hiring offshore team members can help relieve any unnecessary stress felt by your local team through the provision of additional support. Your staff will appreciate this, job satisfaction will increase and attrition will decrease.
Outsourcing specialists are highly trained professionals who can offer insights, advice and add value to each stage of the outsourcing journey. The process involves recruitment, onboarding, training and ongoing management.
The entire concept of outsourcing is to help drive efficiencies in your business. When preparing for an offshore staff member, there are many steps that need to be taken before your business is offshore ready. Part of this is implementing best practice around communications, technology, managing output and work in progress.
The support you receive from your outsourcing specialists will ensure you make the right decisions throughout your entire outsourcing journey. This allows businesses to hire people with diverse backgrounds, experience and education, allowing businesses to source the best talent to help take their business to the next level.
Improve business flexibility and availability
Outsourcing can provide businesses with the flexibility to meet changing resourcing requirements in response to fluctuating customer or market demands. Hiring offshore staff can help businesses manage seasonal and cyclical changes easily as outsourcing providers can have an outsourced team member or team ready to go in as little as six to eight weeks.
This flexibility can help your business navigate risks, support sustainable business growth and plan for peak periods where additional support may be required. An additional bonus is removing the costs associated with lengthy recruitment drives or setting up contact centres suddenly. Outsourcing providers are experts at both - all you need to do is communicate your needs and let them take care of the rest.
Outsourcing in low-cost economies can also help many businesses extend their hours beyond 9-5 pm, 5 days a week and potentially support 24/7 operations in key areas such as customer service or IT support.
Roles such as administration support, sales support, technical support and customer service are easy for many businesses to outsource to support your customers in an ‘always on’ landscape, thereby improving customer experience, retention and most importantly, your bottom line.
How to get outsourcing right
Whether you are diving into the outsourcing pool for the first time or keen to make changes to your current arrangements to avoid becoming a failure story, check out these top tips to consider when developing your outsourcing strategy.
Last updated on July 15, 2022.