Picture this: You run a very successful real estate company and have more clients than you can handle. You must hire more people to grow your capacity, but if you do, you’ll be adding a ton of overhead that will negatively impact your profitability. What should you do?
There is a solution to your dilemma, and it’s not even new. It’s called outsourcing, a business strategy that began in the ‘60s and ‘70s but was officially coined into existence in 1989.
Specifically, you should consider outsourcing in the Philippines.
The Business Advantage of Outsourcing in the Philippines
Whatever your business, outsourcing to the Philippines is an excellent solution if you want to expand your capacity without severely inflating your overhead. Enterprises in English-speaking countries like the United States, United Kingdom, and Australia are in a particularly good place to take advantage.
In the Philippines, English is widely spoken and is, in fact, one of the country’s official languages. Institutions and government entities have adopted it as their primary language for business communication, while schools and universities use it as their medium of instruction. Thus, most Filipinos are conversant in the language, and a significant portion (especially those in the top tier of the country’s talent pool) are fluent or nearly fluent English speakers.
Another potential block to outsourcing, the time zone difference, is not an issue. Employees work within the client’s preferred time zones. Need your offshore accounting team to be on Eastern Standard Time? Say no more; it’s done.
However, the best benefit, which should be enough to outweigh any minor objections you might have (e.g., cultural differences), is cost savings. In the United States, an accountant’s annual pay is more or less $54,000, but in the Philippines, the equivalent salary is approximately $20,400. That’s a savings of $33,600 per head. For a team of 30 accountants, your total savings is $1,008,000.
How about your office and administrative expenses? Yes, you’ll have to add them to your costs, but these costs are not specific to outsourcing. Even if you hire people in your business domicile, you’ll still have to provide office and equipment, learning and development, and other benefits.
Outsourcing to the Philippines offers the perfect balance between expanding business capacity and keeping costs down.
Different Strokes for Different Folks
Outsourcing has never been a one-size-fits-all strategy. There are many outsourcing business models, and the following are three of the business models available in the Philippines.
Dedicated Managed Team Outsourcing
This involves building a team in the Philippines that works exclusively for you. It is like having full-time staff in the Philippines, working in your time zone and solely on your projects. You’re responsible for assigning tasks to your offshore team and keeping them accountable for their deliverables.
However, you don’t deal with the day-to-day operations in your Philippine offices. It’s not your concern which employee is on leave (and why), and you don’t have to manage your office yourself. You’re not responsible for ensuring it doesn’t lose power or internet connectivity, keeping morale up, renewing the staff’s health insurance plans, and paying out salaries and incentives.
In dedicated managed teams outsourcing, you and your offshore staff have a direct relationship and regular interaction. However, your outsourcing partner is your offshore team’s employer on record.
The outsourcing agency takes care of logistics. It ensures your team is connected to your headquarters, there are enough people to answer client calls, and service or output quality is on par with your expectations.
It is also responsible for taking care of your offshore staff, keeping them engaged through the human resources (HR) department’s initiatives, designing training programs around your business to develop your staff’s competencies, and guaranteeing your team is adequately compensated and provided with all promised benefits.
Depending on your needs, your outsourcing partner can also fulfill the role of an offshore staffing agency. It can build your offshore team for you, recruiting job applicants for your open positions and screening them for fit and suitability; however, you are in charge of interviewing shortlisted candidates and making hiring decisions.
Do you need to augment your in-house staff and increase resource capacity quickly? This is the answer. Like the first option, this lets you delegate business processes and functions to the Philippines, but this time, you do it to a third-party service provider, not a team of your choosing.
In this business model, you deal directly with your outsourcing partner. This third-party provider is responsible for fulfilling your service availability requests, per the terms of your contract, and has complete discretion about the staff it’ll hire or deploy to meet them.
To illustrate, imagine you’re a subscriber identity module (SIM) provider that recently launched an embedded SIM (eSIM) cloud management platform and provides, among other services, eSIM tech support for telecommunications companies. Consequently, you must quickly augment your in-house customer support team. In this scenario, you can look for a call center in the Philippines with expertise in telco support and outsource your tech support division to it.
In this scenario, the call center has a pre-existing staff, which it may also augment to fulfill your service availability requirements. You don’t have any say about the people it will hire or deploy to handle your customer support calls. Still, you can hold it accountable according to agreed-upon key performance indicators.
Turnkey Office Solutions
Suppose you already have full-time contractors and remote employees in the Philippines and wish to gather all of them in a private workspace dedicated to your employees. In that case, you will require an office configured according to your needs (e.g., your brand, business size, etc.), furnished with ready-to-occupy workstations, and fitted out with everything your people need (e.g., internet, appliances, seating areas, etc.), including backup internet connectivity and uninterruptible power supplies.
In this case, you have two options. You can lease office space from a real estate developer or an office tower. Alternatively, you can turn to an outsourcing company and settle in a spare workspace in their network of offices.
The first option will give you more control over your space. However, it will also need more capital investment and work before you can render it usable. Such an arrangement also usually comes with a long-term lease.
The second option is more convenient and will get you up and running faster. Relying on an outsourcing company for your offshore office needs will get you a workspace suitable for a remote workforce, one with multiple internet connectivity and power supply backups, enterprise-grade data security protocols, and appropriate furnishings. It should also come with an on-site tech support team to quickly resolve connectivity and other technical issues.
Essentially, in the second option, the outsourcing company will do everything required to provide your team with a safe, secure, comfortable, and functional work environment. All you’re left to do is turn the key and move in.
Outsourcing in the Philippines: Scale Up but Keep Costs Down
Outsourcing in the Philippines — which can take various forms, including dedicated managed team outsourcing, standard outsourcing, and turnkey office solutions — is an excellent way to save on business expansion costs. In the Philippines, you have an English-speaking workforce that can work in your required time zone, and the best part is that the talent doesn’t cost as much as it does at home.