Common Doubts About Outsourcing Which Actually Work In Your Favour

Business process outsourcing is when you use an external firm (not necessarily overseas) to run a segment of your administrative business activities, such as payroll, accounting, legal processes, bookkeeping, and human resources. Many business owners are trapped by outsourcing concerns involving reliance on staff in foreign countries. After all, we are talking about your livelihood. You want to ensure that you are making reliable, cost-effective decisions that enhance the overall quality of your business.

Let’s consider 8 common concerns, and how you can manage them, and in many cases, turn these to your advantage.

1. Is the employee skill set good enough?

This is a valid and important question. Can workers in a foreign country understand our laws? Do they know how our GST works, or even what GST is? Is there level of education up to the same standards? Can an overseas or online accounting firm actually support my business?

The answer is yes!

Clearly there are always risks involving other people in your business. This is true regardless of whether the people will work in-house or form part of an outsourced provider. To help alleviate your concerns, consider the following:

• Knowledge process outsourcing and business process outsourcing are growing industries in specially developing countries, with many accounting firms already well adept at providing services overseas.
• There are many foreign return students and expats who have obtained degrees and/or post degree qualification and experience while overseas e.g. CA/CPA of Australia, CPA of US, CIMA/ACCA of UK. This means that they often have not just equivalent, but the same education as in house employees.
• Thanks to the advantages of technology and the growing prevalence of online education, there is increasing opportunity for overseas residents to complete the same qualifications as in-house employees would.
• In fact over half of the graduates of recent Australian accounting degrees are foreign students (The Good Universities Guide, 2015).
• All of this means that there is already a large pool of skilled resource readily available, with over 6.4 million graduates each year in India alone (Ministry of HRD report – All India Survey on Higher Education 2015-2016).
• Finally, and perhaps most importantly, as part of the growing trend towards globalisation, the International Financial Reporting Standards (IFRS) Board is providing a common language for businesses. The common language ensures that business reports are understandable and comparable across international boundaries. With the move to standardisation of accounting processes, professional bodies are also increasingly moving towards international affiliation and knowledge sharing.

So not only are workers in an overseas office providing you with the same level of quality education that an in-house employee can, a quality outsourcing firm will help reduce the risk of bad hires. You save time and money on administrative overheads, screening, training, and monitoring in-house employees, while having access to a pool of dedicated, skilled and experienced staff.

2. Will working in different time zones negatively impact turnaround times?

Since workers overseas may come from different time zones some people have concerns around managing turnaround times.

This can actually be a distinct advantage for your business. Different time zones mean that your office essentially has longer working hours, which can improve your turnaround time. There are even some businesses who ensure they have strategically placed offices around the world so that they are literally continuously open and working. This is known as chasing the sun or a follow-the-sun support model.

By engaging good time management skills you can take advantage of the overlapping hours to allocate tasks, discuss expectations and deliverables, and conduct one on one reviews. During the non-overlapping time you can review their work and they can independently complete tasks. You are less likely to get stuck micro-managing their roles, which helps ensure that everyone focuses on their own function.

3. It wouldn’t work with our processes

Perhaps your processes are not streamlined for outsourcing, or you think they are too complicated for outsourced employees to understand. Whatever the issue is, you don’t see how outsourcing would work with your business.

In the modern business environment, many workers are seeking the advantages of flexible work arrangements, including the ability to work from home. If you already have employees who work from home then you’re already set up for outsourcing. If you don’t, then outsourcing can help ensure you work in the processes required to enable staff to work from home. This will help ensure your business becomes a more desirable and satisfactory employer for in-house staff as well.

Furthermore, by outsourcing, you will be required to streamline and simplify your processes. As you undergo process improvements, and increase your use of cloud technology, you will be improving your overall business functionality and ensuring you keep up with the times.

4. I’m concerned about communication difficulties

Of course you are! The key to success or failure of any project is effective communication.

The advantage of living in an English speaking world is that English is a world language. However for many people, both inside and outside of English speaking countries, English is a second language. A little bit of patience may be required to explain jargons, slang terms, or focus to remove any ambiguity or misunderstandings.

Regardless of whether business processes are in-house or outsourced, there is a need for regular focused meetings, feedback, and training. Having an outsourced centre can actually force you to become more efficient in ensuring that your communication is clear, transparent, and appropriately regular. When communication issues do arise, just be ready to jump onto a quick call or video conference.

Having an outsourced team working with you means that you need to ensure that you have a very clear Service Level Agreement (SLA) with set and measurable Key Performance Indicators (KPIs). This ensures there is no confusion about who is responsible for what, and how performance will be measured. When working with in-house employees it can be too easy to become slack with clear expectations and to create an overlap of job requirements that puts undue burden on some staff. By utilising outsourcing your office can become a less stressful and cleaner working environment.

5. What about the Culture Gap?

While this one may be a little tricky to resolve, especially if you branch out to a provider who doesn’t yet have experience with your culture, keep in mind that cultures can be different not just from country to country, but even between states or territories, local communities, and business to business.

In a world that is embracing global technology, information exchange, and an appreciation for different cultural norms, bridging the gap between cultures is a laudable enterprise. Your business can even be enriched through insight gained into a culture other than your own.

That said, when you want to outsource to people who will readily fit in with your culture, there are plenty of providers with the necessary experience to relate to your culture. Seek an experienced firm and when necessary use an intermediary agent who understands both cultures. An intermediary can help fill any gaps and provide a mutually beneficial flow of information and idea exchange.

Finally, as always, regular training with staff and contact with relationship managers will help ensure that any culture gap is not an undue burden.

6. Will I see an instant improvement in my business?

A common misconception about outsourcing is that there should be an instant cashflow reward. While there can be some immediate cash savings, when compared to alternatives, we’re not talking about investing in a commodity or futures market with a fast turnover.

Outsourcing your business processing needs is an investment. Think along the lines of investing in blue chip of a fundamentally strong company, which will generate strong returns in the long term.

7. With outsourced workers living in another country, aren’t distance, control and privacy laws a concern?

The distance factor can easily give the impression that you have no control, that there are privacy or loss of data concerns.

The fact is that we are living in a world that is smaller than ever before. Globalisation has removed the physical barriers that once required proximity between a business and its employees. The technology of today means that we can use Skype, FaceTime, screen sharing, phone calls, CCTV cameras, Citrix, and other communication devices to both connect with and monitor workers at any distance.

There are tight privacy laws in place to help protect our sensitive data, just as there are laws in place to protect data from leaving the local office.

In fact, streamlining your processes for outsourcing can help you identify and strengthen any weaknesses your business has with data security, privacy, and control. You will be backing up your data on the cloud, which reduces the risk of losing data stored solely in-house. Furthermore, you will have the expertise and experience of a team who manage these concerns as part of their daily living.

8. I’d rather do things the same way they’ve always been done

Perhaps one of the biggest barriers to outsourcing is a general aversion to trying things a different way. Whether it’s a matter of things going pretty ok as they are, or a fear that trying to use outsourcing will cause additional problems, there can be a general hesitancy to running business in a way that you’re not familiar with.

Without risk, there is no reward.

Outsourcing can provide a uniquely tailored solution to your business processing problems. If you’re intrigued by the possibilities of outsourcing then don’t let fear of what is unknown stop you from trying. When we try, we learn. As we learn we improvise, improve, and succeed. The advantages of outsourcing are right there for the taking.

Conclusion

While there are definitely challenges to work through when it comes to utilising outsourcing, they are not dissimilar to the regular challenges involved with hiring any employee. Furthermore, there are distinct advantages involved in outsourcing. Apart from cost savings, you are gaining the skill and focus of a dedicated team, as well as being required to improve your internal processes and increase the efficiency of your business in the process. Now is the time to stop thinking about what is holding you back, and start taking advantage of the opportunities that outsourcing presents.

Written by: Darshak Shah (EVOURCE Co-Founder )