Common offshoring mistakes to avoid
Offshoring is not an uncommon practice in the business world. With the many advantages it has to offer to businesses, companies have been relying on offshoring to gain a competitive edge in the market for years. Its promise to offer efficient services at a cost-effective price is like a beacon to many businesses. Small and medium-sized businesses are especially known to benefit immensely from offshoring. Yet, like any other business practice a company decides to incorporate, offshoring too requires careful consideration and strategy. In the midst of the many success stories you will find about offshoring, you will also come across certain businesses that could not capitalize on it.
While each business is unique and requires its own strategy regarding offshoring, there are some ways that can help a company succeed in offshoring services. By learning from the success and failures of other businesses, there are some mistakes that should be avoided if you are considering offshoring. Below we list a few common offshoring mistakes to avoid.
Choosing money over quality
As the primary goal of any business looking to offshore services is to cut down on costs, it is understandable why you may think picking an offshore service provider with a low offer is beneficial. But it is one of the biggest mistakes a company could make. Offshore service providers are an important factor in the success of your offshoring endeavor. They are the ones that will be managing the services you offshore to remote employees; they are your eyes and ears on the ground. They are the other half in this business partnership, and you need to ensure you can rely on them to have your back. A vendor’s ability to provide services at a low price is likely to reflect their poor quality services. When you pick them as your partner, you essentially choose money over quality. It may be gratifying at that moment, saving money right at the beginning, but it can really hurt you in the long run. So, it is essential to carefully consider your offshore service providers, scrutinize them, and choose the one that provides you quality services and shares your vision.
Not analyzing your business needs
Offshoring gives you the benefit of hiring labor at a significantly less cost as compared to hiring locally. Therefore, it can be tempting to offshore a significant part of your company’s services overseas. You may see a rival company offshoring their such and such functions, and are now wondering whether you should be making that call too. But that’s not how offshoring works. Offshoring is very specific to your business and the needs of your company. It requires a careful analysis of your business. Before you even begin looking for vendors, you should have a clear picture of your needs. You have to know the processes that you can move out of your company to a country miles away. Identify the processes based on their complexity, frequency, and importance. Once you have an idea which processes are your core business operations, you are that much closer to selecting the processes that you can benefit from offshoring.
Lack of communication
Communication is key in business. Your employees should be able to interact and collaborate for any project to succeed. But communication becomes that much more imperative when you have two teams miles apart working for the same company. The distance can be a challenge, especially when there are time differences involved. But in order to achieve the level of quality you expect from your offshore team, they require all the information that is central to the project. Emails are not always the answer. You need to set up various communication channels that include audio calls, video calls, and instant messages. Keep your offshore team informed of any new information and any recent updates by an appropriate communication channel, and ensure that you are available if they need to contact you. Effective communication is how you keep your offshore team involved and on track.
Too little or too much involvement
When you have a team of employees that are working for your company from miles away, there are two likely outcomes. Since they are not where you are, you either forget that you have an offshoring team and barely interact with them. Or since they are not where you are, you are constantly in touch with them, demanding updates and overseeing their work. Neither options yield positive results. Micromanagement and no management are both harmful to your company. Your offshore team is an extension of your onshore team. They exist to supplement the employees in your office, so they need to know everything that happens in the office related to their work. Keeping them in the dark negatively impacts the work that they do for your company, and your business suffers. Similarly, continually checking up on them and overlooking each move they make can translate to a lack of trust in your employees, which never helps. It is also counterproductive as offshoring is supposed to save your time and energy. The need is to strike a balance between the two. Ensure that your team is provided with the required information. Ask for regular updates, but without being overbearing. Your offshored processes should not suffer because of inadequate management.
Lack of a backup plan
Be prepared for the unexpected, always. Even when you do everything you were supposed to, sometimes things don’t work out the way you want. So, always have a strategy in place should your offshoring plan not work. Maybe it is because the vendor isn’t able to deliver, or maybe it’s because of external factors such as a natural disaster striking your offshore location. Whatever the reason, it is always advised to plan ahead for any crisis that you may face in the future. It lets you minimize your losses and come out of that situation with a plan in place.
Offshoring is the answer many have been looking for to cut costs without giving up control over their business operations. So, if you think it is right for your company, go right ahead. By avoiding these few common mistakes, you are that much closer to successfully offshoring business processes.