What confuses me about Outsourcing?

As many of you already know, I do more than post as the #WORLDSWORSTCONSULTANT and work with small businesses to reduce their costs and improve their business operations, I am also the CEO and founder of Ethical Outsourcing (www.ethicaloutsourcing.com.au).

Having working with outsourced suppliers and companies for the majority of my career I felt I was in the perfect position to start making an impact and pushing the whole outsourced services function to becoming a more dignified and human experience for both parties.

When I was working with companies that manufacture products throughout SE Asia for supply to Western Customers, it never ceased to amazed me that despite already getting a significant price advantage, the purchaser would always want cheaper and cheaper goods and subsequently push down the quality to a point where they start the “cheap Chinese crap” mentality.

I remember asking a supplier why I never saw many Chinese branded cars in China, in particular asking about a model that was sold as a budget vehicle in Australia and getting the comment “We prefer to buy the imported vehicles and the brand you are asking about does not comply with the domestic standard so it is only manufactured for export”. So the purchaser decided they wanted a vehicle at a price and continued to press the supplier to a point where they were not able to supply any standard models and needed to produce an “export only” model that was made to a price not a standard.

Then I started to see it a lot more, products that we would buy here were not often available in Asia (expect at fake markets) and it came down to a common theme.. the purchaser wanting to buy at the minimum price regardless of the quality. 

We have become a culture seeking to get cheaper and cheaper goods and services and accepting of the fact that lower price = lower quality.

There is fantastic quality available (if you own any Apple devices you can probably attest to this statement), we just want to pay less for less.

Which brings me to the outsourced services scenario. We have become obsessed with paying the minimum rate for a basic level VA who can do rudimentary tasks (and likely complaining about the amount of times we need to double check their work) but the same applies for services. Not all outsourced employees are the same and at the same level. You need to think of it in the same way you would if you were employing someone locally: if you want to pay the minimum you get the minimum experience. The advantage with outsourced services and VA’s is that you can pay a bit more, still save a lot of cash compared to the local market and get someone truly exceptional.

If you are happy paying the minimum and redoing / rechecking the work, then this is fine and maybe within your current purchasing practice, however consider for a minute what you could truly achieve with someone who is accomplished in many areas of business strategy and management, has perfect written and spoken English and can produce exceptional work with minimal direction. 

And all for a fraction of the price you would pay someone less experienced at a local Australian salary! Isn’t that the real reason you look for outsourced services? To make your life easier and free your time for more important tasks? If you are considering outsourcing or finding a VA, at least do it correctly so you have the assistance and experience you desire, not an ineffective debit on your revenue that you complain about to everyone.

You can already save a lot of money by outsourcing, it confuses me why businesses don’t reinvest some of the savings to get more skill and capability for a lot less money.