With the changing landscape of the employment market, execs and business owners are forced to change the way they fill talent gaps in their organizations. The first places you might look is recruiters and recruiting agencies, then to BPO Business Process Outsourcing) companies, Freelance consultants, and outsource staffing companies.
However, if you have little to no experience with outsourcing, you may have questions or be influenced by outdated information. Today, we are discussing some of those myths and hopefully helping you to understand outsourcing options before you consider that an as option to fill any talent gaps you may have.
In this article we will look at myths involving individual or small team placement, where you manage the team directly, or BPO options where they manage a specific line of business.
Let’s discuss some myths!
Myth #1: Outsourcing means you give up control of your business!
Myth! It is your business; you are in control!
Just like your in-house employees don’t take over your business, an outsourced team member works within your guidelines, has access to what you allow, and more importantly unlike an employee an outsourced team member has one more layer of monitoring and management keeping an eye on performance through the outsourcing company.
As for a BPO example, a company might want to outsource bookkeeping and accounting for their day to day bookkeeping, sales tax, payroll, or receivables. When companies outsource bookkeepers or accountants, these individuals would only work on the specific outsourced tasks – no more and no less. They are not given any significant authority for matters not concerning the assigned tasks. Keep in mind, they only have the access you give them, they should only have the access to tools that they need to complete the task you have hired them to do. Additionally, if you are using a cloud-based software, that software will have security and you can monitor activity.
But we are getting off point, they do not control your business, they work on the tasks that take the time away from you doing your business.
Myth #2: Outsourcing only should be used to cut costs
MYTH!: Outsourcing doesn’t just save costs
Cost reduction is just one of the many benefits. Yes, it is true that typically an outsourced staffing solution will save approximately 70% of the cost of an in-house employee (particularly true when choosing an offshore teammate) .
Additionally, companies can outsource individuals or teams that are specialized or use a BPO who has a reputation for solving a particular issue. This is known as filling a talent gap. Outsourcing staffing companies are skilled at finding high quality team and BPO companies gain business by building their reputation via successes.
Thus, the cost advantage is not the primary driver as to why outsourcing is popular. They can also fill talent gaps, expedite growth, or solve major issues!
Myth #3: Outsourcing guarantees reduced skill levels, reduced market or product knowledge, or language barriers.
MYTH! The world has changed, and technologies have made access to worldwide talent a possibility!
The days of outsourced talent being housed in terrible work environments, the individuals being poorly educated, unskilled, and even hard to understand language barriers is ancient history. Admittedly, there are still some providers that we will say are less than ethical, but overall, the business of outsourcing has evolved dramatically. For example, most candidates we provide have a minimum of a bachelor’s degree and at least a couple of years of experience in the field. (Qualifications any employer would be glad to see on a resume).
Today’s remote working environment and technology has paved the way for highly educated and well-trained team to be made available from all over the world, just as if they lived in your backyard! And, with worldwide experience in the role you need to fill.
As to the language barrier issue. We know where this stems from and we all have had the customer service experience that comes to mind, but again, this is not the type of service we provide. We will provide recorded calls and/or video interviews so you can experience the quality of speech for yourself.
The point is, we believe the facts around this myth are the exact oposite of what is rumored, there are exptremely talented people who now can be a part of your remote team seemlessly!
Myth #4: Outsourcing is too expensive for small business
MYTH! Outsourcing staff and BPO services is a HUGE advantage to small to medium companies.
First, outsourcing staff (particularly offshore) can allow small to medium business the ability to hire team that, if they looked locally for the same qualifications would be way too expensive to afford. A couple of examples of this are: A social media manager in Seattle based on Salary.com median incomes are approximately $70,571 per year and in Chicago $68,473 per year and in Boston $72,721 per year (and this does not include benefits, employee-based taxes, and office costs) but for the same qualifications leveraging off-shore outsourcing the total cost ranges between $20,000 and $24,000 per year depending on experience total, all in, no additional costs.
Another example, A graphic designer, call it level 2, in Seattle based on Salary.com median incomes are approximately $67,283 per year and in Chicago $65,283 per year and in Boston $69,333 per year (and this does not include benefits, employee-based taxes, and office costs) but for the same qualification leveraging off-shore outsourcing, again, the total cost ranges between $20,000 and $24,000 depending on experience level. We can provide dozens of examples, but what is little known is how many different roles can be filled!
Another reason small to medium business are served well by outsourcing is the ability to scale quickly! Working with an outsourced staffing solution give you all the power of a big recruiting firm, but a fraction of the cost. The power of big business, but the maneuverability of the small company! Winning!
Myth #5: Outsourcing will compromise your company’s privacy and security
MYTH! Company security particularly financial data when working with a BPO is just as important to the BPO as the company.
In business relationships of all types, trust is the key to a success and maintaining relationships. BPOs operate by earning the trust of their clients, which can then be reinforced by validating with past and present clients. The security and safety of a company’s data is the top priority of any reputable BPO. If they mismanage the data of their clients, companies will lose confidence in the BPO industry, and more importantly, if their reputation is destroyed, they will be finished in the arena. One of the major aspects of competition in the BPO world is data protection and security. Choose a reputable company and this concern goes away.
As for individuals and small teams who are outsourced staff and managed by the business owner or manager, the risk is the same as it is for any employee relationship with one major difference, there is an additional layer of security with the outsourced staffing company monitoring and managing the teammate as well. Does it guarantee the integrity of an individual, of course not, but the outsourced staffing company is bound by the same laws as any contract in the US, so their interests align with yours. Again, is it bulletproof, no, but it isn’t any different than if you have the person sitting in your office.
Myth #6: Outsourcing means we weaken the economy
MYTH! In fact, from an economist’s point of view, outsourcing strengthens the economic status of our country.
Why you say? Outsourcing can be a cost advantage for companies. Because of that companies can use those savings to accelerate the important goals that would lead to the company’s growth and development. That winning combination increases the companies need for staff, increases the companies spending with their vendors, and this cycle of growth is exactly how small companies become big companies, which in turn employ more people both in-house and outsourced, put more money back into the economy!
A healthy and growing company creates more investments, more spending with vendors, and more employment opportunities. Outsourcing becomes a tool in the arsenal of business, extending the longevity of businesses which in turn creates more tax revenues and employment opportunities and so on and so on.
Myth #7: It’s hard to manage outsourced staff
MYTH! With Remote work force becoming the new norm, managing outsource team has never been easier!
BPO companies are self-managed, so they immediately counter this myth. Individuals and teams are managed no different than if you were to direct hire remote staff. There are arguably challenges to managing remote staff that you do not have with in-house staff, but when you weigh all the pros and cons you will find that the extra effort required to manage a remote team is well worth the time.
The biggest hurdle to overcome is onboarding an individual if you have never hired a remote team member, but never fear, we will help there too.
Myth #8: Outsourcing is unethical
MYTH! Offshoring provides opportunities that otherwise would not be available!
In the past offshoring has brought up concerns for the welfare of the outsourced workers. Conditions outsourced teams are working under and the belief that the comparable pay is so much less. This is a common misconception of outsourcing, and it could not be further from reality or the truth!
First, we need to make is clear that Outsourced Staffing Solutions only works with providers who go above and beyond to ensure that their workforce is exceptionally treated and well paid. We also only choose to work with providers who work in countries who have protections in place; for example, our teammates in Sri Lanka are paid very well when compared to other people in their community in similar but non-outsourced roles. They can often be paid 100%-200% more per hour. Additionally, the Sri Lankan government is very protective of their labor-force, and very pro-labor when it comes to regulation and policy. That is why we require that all our providers have a substantial presence in the country where the team is located.
The outsourcing industry creates a win win situation that offers people a great environment to work in, safe and pleasant facilities, training, and opportunities to grow in their careers! The money that they earn is a good and sometimes a great salary, relative to their costs of living.
Myth #9: Outsourcing is only a short-term solution
MYTH! We are only really interested in helping companies to fill long term solutions to talent gaps!
This is an area where freelance workforce and outsourced solutions significantly diverge. Freelance and even some consulting contracts are by nature project based and a short-term solution. But outsourced solutions are designed to be exactly that, a solution. The team we place only gets better as they grow with the company, just like an in-house employee, they learn the nuances and skills to be more and more efficient at their role, they learn the culture of the company, they want to keep their job just like an employee so they learn to be the best at the role they can!
Whether a BPO solution or an individual, they want to be the solution and to contribute to the company’s growth no different than an in-house employee!
Myth #10: Outsourcing a specialty role is way too complicated for small businesses
MYTH! If you can train or hire an in-house employee to do the task, you can outsource the task.
Technology today has made it possible to outsource even the most complicated and technical of roles. This includes IT Support, Design, Marketing, Social Media Management, Editing, Assistants, and even C level staff! The list goes on and on.
For example, small businesses can reduce fixed salaries expenses if they hire IT outsourcing companies or even a multiple person offshore technical support team. Tech support outsourced to a BPO with on-the-line or on-call billing allows companies to only pay for the actual services or the time consumed.
Hiring an offshore team can create the same opportunity and still allow for 24-hour availability at a fraction of the cost when compared to in-house service at the same level. Just so you can see the difference, a single in-house IT specialist according to Salary.com will run approximately $75,000 to $90,000 per person depending on the area of the US (not including additional employee costs), where an offshore teammate with the same skillset will cost approximately $30,000 per year.
Myth #11: Outsourcing sales team hurts company branding
MYTH! With today’s technology customer facing activities are nearly seamless, including sales and customer service with outsourcing.
It is understandable why small and even medium size business owners believe and are arguably the best salespeople for their products. However, whether you hire in-house sales team or outsource the sales team, at some point if you have to grow, you need more people selling your product than just you. Not to mention that if you are the only rainmaker, how are you keeping an eye on all the other areas of your business?
But the question is not whether you hire salespeople, the question is whether the brand is hurt by outsourcing. The reality of today’s market is that a huge number of companies are moving away from in-house teams and moving to outsourcing. Why? Because technology has made it seamless regardless of where the individual is in the world, the transition from the customers point of view is uninterupted just as if the individual was in your offices. Your brand is not harmed, because you trained the individual or team, provided the branding and the scripts, you can even be the point for escalation if you choose.
The reality is that outsourcing your sales nd customer service teams can exponentially grow your business!
We know it is a lot of information and we hope that it has been helpful and informative, but we also understand that every business is unique in its needs, so for your specific situations, talk with one of our consultants. Deep dive into what we do and how it can impact your business!
Click here to set an appointment with a specialist: https://www.outsourcedstaffingsolutions.com/schedule