How to avoid offshore disappointment

 

Scott Linden Jones – Offshoring Consultant

 

 

To be open with you, the majority of businesses who try offshore outsourcing are disappointed the first time;  I learned that while I was researching my book in 2010.  Those ten main failure reasons that I found in my research formed a core of the consulting methodology that I subsequently used to guide many companies to success.

 

I’m not telling you this to discourage you from trying it. As I detailed in my book, I think there is a much bigger risk is not adapting your business to match the realities of the new world of business, with its hyper-connected work force, automation and shrinking margins.

 

But if you want to get offshoring right, it really pays to have a strategy that is proven, and to set your expectations according to the evidence of those who have gone before you. If you have a faulty strategy or no strategy at all then it’s just a “crap shoot”.

 

For those without adequate knowledge, expectations are rarely met by the services that they purchase or the staff they hire. Perhaps you have had this experience already. Or perhaps you are looking to avoid a painful learning curve.

 

Below are some of the ten damaging gaps that businesses experience with offshoring, and how your advisors need to lead you through such issues.

 

Poorly Designed Roles

If you create roles in Philippines the same as at home, they will often fail.

Combinations of skills are different offshore. Your advisors need to explain HOW your roles are different BEFORE you begin recruitment.

 

  • Tech Elite consults to clients on the structure of the roles before we begin.Approximately 60% of the time a new client will structure a role that has serious flaws. Our first job is to correct that.It’s very clear from browsing jobs advertised by many other facilities that they do not properly consult with clients to adjust roles before recruitment begins. If not fixed, this results in drawn out recruitment, incorrect matching of candidates to roles, paying too much to find a unique person, and staff that are very hard to replace.
  • If your strategy relies on finding “unicorn” staff that have a unique combination of skills, then your strategy is flawed and your facility doesn’t have the courage or the knowledge to tell you how it’s flawed. We can show you how to design roles that leverage your local staff, while building a scalable and reliable offshore team.
  • For us to do this, we just need about a 2 hour session with you to understand your business, the bottlenecks, and the key senior staff. What always comes out of those sessions is that the client better understands what is simple to offshore (phase 1), a bit harder (Phase 2), and near impossible (pursue as a bonus not a core strategy).

Resumes & Interviews Don't Find Winners

The vast majority of time that you can’t find highly skilled staff, it’s because the recruitment process is flawed. Often the client doesn’t realise the facility’s flaws and becomes convinced that offshore staff are not skilled enough.

 

  • In the Philippines you simply can’t consistently hire good people based on interviews, resumes and references like in Australia or similar countries. Why?
    1. The resumes are… optimistic to say the least. (wall-to-wall nonsense is another way to say it). There is no cultural expectation that resumes should be factually correct. Everyone looks like a genius on paper.
    2. Referees wont ever say anything bad and neither will previous employers. This again is part of the culture – people won’t deliberately cause loss of face to someone else.
    3. Interviews – this tends to work the other way. Filipino candidates are often so painfully shy or nervous and so bad at interviews, that they can barely communicate. A week into the new job and they seem like a different person.
    4. So the end result is that you shortlist people who are terrible, and rule out people who might be great but interview badly.
  • At Tech Elite we eliminate this gap via an obsession with skills testing. So you say you’re competent at this list of 300 things? Ok, sit this exam and prove it. You say you have great attention to detail? Ok, find all the errors in this document. You say your written and spoken English is 5/5? Great, let’s do some testing and we will objectively measure it.
  • One of our key differentiators is that we spend most of our recruitment time analysing candidates to uncover why they WON’T succeed. Finding the top 5% is our mission. This is also far more efficient with your time. We aren’t presenting you with a horde of applicants who passed some largely pointless “screening”, and then suggesting it’s up to you to use your magic skills to get through the cultural barriers and the needle in the haystack.We don’t hide behind some replacement guarantee – it’s OUR problem to find you the right person, not yours.

Poor management / strategy by the client

There’s nine kinds of “outsourcing”. Only some of those will work for your business. Some will not work because of your management structure or available time.

 

  • With our unique multi-shoring consulting, it will become very clear to you and your management team what you need to do in order to succeed.

  • Because there is a great deal of accuracy with our recruitment, the next biggest weakness in the typical multi-shoring strategy comes from the client. It might be for example that you have no suitable local manager who can properly manage those people. 

    For example, an accounting firms asks us to hiring a couple of software developers to build them an app. Sounds feasible to them – the developers cost one third to one fifth the price of back home, so $50,000 goes a long way.

    Getting great staff is no problem, we can do that. But with our model of offshoring, your new offshore staff will run YOUR processes and be managed by YOU. That is a god-send for the core processes in your business that you excel at.  But if you have no software development processes, no way to guide the team daily, and no suitable manager, your software will NEVER get built and it’s probably a waste of your money even trying. In this case we would help you find an outsourced software company that won’t rip you off and has a proven track record.

  • We hate to fail more than we love your money. We want a raving fan who WASN’T a client more than we want bums on seats. So when the consulting uncovers that we are not a good fit for your organisation, we will tell you and make some alternative suggestions that will work better for you.

Poor Communication and Collaboration

If you don’t know how to adapt your organisation’s communication methods then multi-shoring to the Philippines will cause you headaches or make your local team revolt.

 

  • The first consideration is the “internal sell” to your local staff. The way you present what you are about to do offshore makes a big difference to how supportive they will be of the changes. Some will feel threatened if you handle it badly, some will be outright saboteurs. Let us help you craft the “internal sales pitch” so that your existing staff see it as an opportunity for them, not a threat.
  • Your local team needs to appreciate that your new staff will be speaking English as a second language. And that Australia’s 23 million people speak funny compared to 105 million Filipinos (and the 320 million Americans who share the same version of English!) Some simple tools we give your team (on both sides) will help everyone communicate more effectively and get your Filipinos up to your standards quickly if they will work directly with clients.
  • You should also adjust the way in which you share information with your staff, now that you are about to have offshore staff that don’t see and hear what else is going on in the organisation. Once again, our consulting shows you how to do this effectively with the minimum of effort.
  • If you plan on building your offshore team to be core to your business (you’ll end up in that mindset anyway after you see how well it works with us), then there are also some ways we will show you to bring your company culture into the Philippines team.The people we hire for you are YOUR people, running YOUR processes, and taking pride in YOUR organisation. The more you help them feel your culture, the more connected they will be and the better your results will be.

Unreliable infrastructure or attendance

Businesses who hire staff to work from home are frequently disappointed with productivity. Similarly, some facilities spend a lot to ensure reliability, while others spent all their money on a glossy website.

 

There are many impacts to offshore team productivity aside from finding the right staff. Some of the others are:

 

  • Internet connections. Skilled offshore staff without great internet is a waste of time at best, and damaging to client relationships at worst. (Call drop outs, expired deadlines etc)
  • You’d be amazed how many facilities skimp on internet speed and quality. Why? Typically in the Philippines Internet is 5 to 10 times the price of Australia and the quality is still lower!

  • Not only does Tech Elite have TRIPLE redundant internet (including the lowest latency product in existence), we also have our routing designed by our Australian sister firm who has 15 years of experience designing networks and IT security for Australian companies. Result: fast connection to remote servers and cloud, high call quality, and high productivity.

  • Training and documentation is a challenge, particularly for very small businesses. But don’t worry about making things perfect before you begin. We can show you how to make the first 2 weeks of you new staff member involve improving documentation.
  • Performance metrics and performance management – we will be the ones reminding you it’s been 12 months since you team member’s last performance appraisal, and giving you a process and salary packaging guide if you don’t have your own processes.Performance management and rewards (salary packages and benefits) must be completely transparent between us, you and the employee, so that we are all on the same page as to what your business values and how to excel.

No Sense of Urgency

  • Have you ever worried that your staff aren’t responding to your clients fast enough?  Of course you have – it’s a key driver of success in nearly every business these days.  So what is your strategy for getting your offshore staff to have a sense of urgency and respect customers’ timeHave you seen how slowly a plane loads with passengers in the Philippines or noticed that a Filipino taxi driver’s standing rate in traffic is mere cents per hour?   Your cultural expectation of the value of time is NOT the same in other countries.
  • Even the most skilled staff can still let you down in this area. Expecting hundreds of years of cultural influence to vanish the second someone puts on your uniform is unrealistic.  Our consulting will show you how to address this important point.

Continuity & Retention Problems

There is nothing more frustrating than training someone, and then they leave and you have to start from scratch. This is a common problem for other facilities and with work-from-home arrangements. Not with Tech Elite.

 

  • Long before our management team started Tech Elite, we each had offshore teams in the Philippines, and went through the hard lessons of staff retention. We know your pain, and we have the cure.
  • It starts with our outsourcing model (called “Transparent Specialist Staff Leasing”). This model gives you control of key the elements that matter to staff retention (such as control over salary, tools and benefits). You need to stay in touch with what is important to them.Some facilities talk about how important THEY are. How much your staff love working for THEM.  We see things a bit differently – yes it’s important we give them a great work environment, but study after study shows that salary and office environment are secondary reasons for staff satisfaction and retention.It’s really important that these staff feel like they are a part of YOUR organisation. They should feel connected to YOU as the boss. They should have a sense of pride about what YOUR company does for its customers.  We help you and them achieve this connection – from our initial staff induction through to our regular staff progress meetings.  Staff that feel connected and appreciated will stay longer.

    We help with the face time, team bonding, fun events and a great office environment.

  • With years of intel and experience, we put together the perfect system for retaining staff; a system involving elements of location, environment, salary, benefits, and family loyalty. It’s a bit of a “secret sauce” , but it’s the first thing you’ll learn with our kick-start consulting. Our staff retention (at time of writing) is an industry-leading 98%. When our staff succeed, our clients succeed, and we succeed.

Scalability Problems

STARTING an offshore team is easy – just say ‘yes’ to any random solution and start paying. But having a strategy that allows you to scale to 3 staff or 300 requires more consideration.

  • Your strategy for scaling will be unique to you. Even if your business sells the same services as one of our other clients, your business goals will be different, your management capacity will be different, and so the issues hampering scale will be different.

  • Importantly, we have built Tech Elite to scale as well.  Many facilities have IT infrastructure that they don’t realise is a ticking time bomb.  They have an office that is bursting at the seams (or so empty the rent is killing them).  With the insight that decades of experience brings, Tech Elite will maintain its service quality as it grows, so that we are never your bottleneck to growth.

 

  • When one of our founders was writing his book in 2012 , his research uncovered two important facts. Firstly that around half of (Australian) businesses trying offshoring were failing to get what they wanted. And secondly, that almost all of the failures were due to poor strategy (or no strategy). It was crap-shoot.
  • Even today, there are almost no staff leasing facilities that offer consulting to clients on how to perfect multi-shoring. They hire some staff, and leave it up to the client to succeed or fail. Unsurprisingly, the failure rate is still high.
  • Tech Elite gives every new client consulting to ensure that they have a strategy to deal with the ten most common causes of offshoring mistakes and failures. The information is practical and efficient – it’s a crash course in offshoring and if you follow the simple (but important) advice, you WILL succeed and you WILL be able to scale your team.

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