How To Benefit From Nearshore And Offshore Staff Outsourcing

Businesses and corporations are always looking for ways to grow and compete in different markets. Offshoring was born as a way to compete by lowering production costs. The strategies of?offshoring and outsourcing ?have been used for more than half a century, since the late '60s or beginning of the '70s, with General Electric being one of the pioneers. Large corporations offshored their manufacturing plants to low-cost countries to take advantage of lower wages.

Based on my experience, in the late 1990s and early 2000s, large corporations?found a new way ?to reduce their costs. This time, instead of lowering their production costs, they lowered their service and employee costs. They began to outsource their call centers, as well as back-office tasks such as customer support, to other developing countries. This was a win/win strategy for corporations as they lowered their costs and for the low- and middle-income countries as their employment rates surged.

Outsourcing and offshoring were mainly used to save on costs. Therefore, these strategies were usually reserved for large corporations due to the volume needed to make them economically viable or the cost of building a new plant overseas. But with the rapid evolution of the internet and technology, companies found themselves fighting for the best developers and programmers.

By 2016, technology and science jobs available in the United States outnumbered qualified workers by around?3 million . Companies started looking for top talent abroad, especially in India and some Latin American countries. There was a boom in information technology staffing firms that helped companies fill the talent gap in their home countries and obtain employees who would work at lower wages. Besides the staffing agencies, the biggest beneficiaries of this trend were big tech firms, as it helped them to address tech talent shortages. The movement toward remote work was starting but mostly reserved for technology jobs.

Then in 2020, the Covid-19 pandemic led to new ways of working as employees had to work from home. This time remote work was not just reserved for technology jobs but for all positions. Companies had to find the best ways to have their employees work remotely. In early 2021, a new phenomenon emerged in the U.S.: the "Great Resignation," in which employees voluntarily resigned from their jobs in masse. In combination with soaring inflation rates and the fear of a recession, this forced businesses to find new strategies to get top talent and save as much money as possible. Based on research conducted by my company as well as personal experience, I believe 2022 has marked the start of a trend toward offshore and nearshore staffing, not for technology jobs alone but for all kinds of positions.

To improve communication with their teams, many companies needed to fill positions with people in their time zone as well as individuals culturally similar to those in the main business location. To do so, they turned increasingly to nearshore staffing firms. The benefit of nearshore staffing is not reserved for big corporations; a business of any size can take advantage of this strategy.

In the current market, in which competition is global, every business should explore this trend and see how they could benefit from it. It doesn't matter in which industry your business is or the size of your business; around?1 million employees ?in India alone were working for U.S. companies through offshoring, not counting nearshoring or Latin America, where hiring skyrocketed in the second half of 2021, increasing by?286% .

You can reap the benefits of nearshoring by hiring a single virtual executive assistant or taking on a complete team of digital designers, developers, and call center workers; you can fill any position for which the work can be performed remotely. The most important thing is to analyze which jobs can be done remotely, supply the necessary tools, and have policies and procedures in place.

With these preparations made, you can see success in working with remote talent through a nearshore firm. When you are ready to use nearshore or offshore staffing, you should evaluate what benefits you need the most. For example, nearshore staff will be in a neighboring country that has a similar culture and time zone. Some of the features to keep in mind when selecting a nearshore or offshore firm include making sure the firm shares the same culture as you, ensuring that you have the final word on selecting the staff, making sure you can scale as you need, employee turnover rate of the firm, extra value-added for you and your team, quality of candidates, service and support provided by the firm and ensuring you can manage the team directly and that they will feel part of your company.

Once you have determined the benefits you need, look for a firm you feel comfortable with and that shares your company values.

One must remember some of the challenges that can arise when partnering with a staffing firm, the first one being communication with your remote team. You have to ensure that your company has the right tools in place for communicating and maintaining constant communication. The second is having clear goals, expectations and policies for your remote staff to ensure that they know what is expected from them.

Nearshore and offshore remote teams can give small- and medium-sized businesses (SMBs) the necessary talent without sacrificing their budgets and scales, allowing them to grow quickly. Having a nearshore remote team allows SMBs to expand their team capacities by having staff or talent that in other ways would be impossible due to costs, as well as preventing them from needing to invest in equipment and infrastructure. I think that each year more businesses will be implementing nearshore and offshore as one of their strategies to tap into the global talent pool while becoming more competitive in costs.