3 Tell-Tale Signs That You Need To Ship Offshore
During my decade as a business development director, I have observed that business owners and senior managers engage in various forms of marketing. Right from attending voluble conferences/seminars/networking events, placing adverts in newspapers, overweening appearances in TV commercials, publishing self-promoting articles in relevant industry magazines, to the unaccommodating task of cold-calling, they seem to have employed them all. And many to the desired effect.
Some feel tertiary levels of marketing like cold-calling and email-shots have been done to their deaths. Being a self-proclaimed analyst I’d beg to differ on this. Even if the results are based on the probability factor, I believe that cold-calling and email-shots help gain insights into how the cogs turn in any industry. For me, personally, it has produced excellent insights and statistics.
Over the years, using these insights, I have analyzed why many companies either chose to outsource or dismissed the F&A model with a swift flick of their hands. There have been a number of reasons, and having headed BPO marketing departments, for as long as I can remember, I can say I have heard them all.
Some of our clients chose to outsource for a broad spectrum of business reasons like prevalent economic conditions, reducing the clerical workload, restructuring costs, reduced labour cost available with offshoring, while others chose not to outsource because their business priorities were different, or simply because the decision makers did not think it was the right thing to do.
A survey carried out by HFS Research in 2011, concluded that the demand for F&A outsourcing has reaching unprecedented levels. The current economic climate has even turned the prudent ones to outsourcing. They surveyed the buyers of outsourced services and revealed that 31% of businesses are already using an offshore provider and another 17% were about to take the leap into outsourcing.
What I am trying to imply here is that it is becoming increasingly clear that people are seeking outsourcing to make businesses profitable in these uncertain economic times.
Whatever the reasons to outsource or not, here are 3 tell tale signs that your business case is in need of a major overhaul.
1- You want to focus on business growth over operations
We have delivered benefits that go beyond the scope of cost savings. Outsourcing has brought about massive innovation as new resources are made available to strategize. It functions as a rung which allows you to take the next step towards growth. This is very important as your resources give you the competitive edge over others.
When you team up with QX, it’s not merely a provision of our services. You partner with us and we develop a long term relationship with you. Additionally, outsourcing also reduces the overheads that come with recruiting, retaining and training your own team. It frees up office space, purchase of technology and the investments that go with it. So don’t get entangled in the cumbersome chores of buying and maintaining, and free up your time to go out and do what you do best: get more business.
2- You want to slash costs
I have gathered that cost cutting is one of the top three reasons why any company would choose to outsource. In terms of cost reductions, our clients, initially, had set a target to cut the cost by at least 30% when they started with us. In comparison to their in-house cost, we were able to deliver reductions close to 50%. One of our clients asserted that the savings acted as a jumpstart and he was able to use the savings to raise his portfolio of clients.
I understand that saving money is not everything for large and medium sized companies. I think the top two reasons why companies choose to outsource today are:
a) Freeing up internal staff for value added initiatives
b) Focusing on core competencies of the business
3- You are reeling under the burden of recession
It’s a given that a businessman wears many hats. And there will be a time when he has to weigh the circumstances and analyze the impact the recession has had on his business. There is a lot of research evidence that suggests that the recession is here to stay. Without trying to sound like a naive pessimist, I want to affirm that the times are slow, the drought seems never-ending and the roots of recessions have dug in deep. Reducing costs/overheads has become a top priority with many businesses.
Today, businesses need to look at ways to maintain revenues. At the same time you might be compelled to keep your roots down. Businesses are torn between choices - to outsource and increase revenues or to remain local? At the same time, the world is becoming increasingly global and this has had a dramatic influence in virtually every person’s life. We are more connected to each other than we ever were. There is a constant flow of global capital between countries, technology can now be easily transferred between nations, and international trade is on an all time high. It’s imperative that we confront this opportunity rather than shy away from it.
Food for thought
As the world moves towards a global economy, the path to success lies in excelling at things which differentiate you from your competitors. Whether you choose to reduce operating costs, or focus on the core competencies of your business, outsourcing is about achieving the next level of benefits. It is the means to hold your own in this highly dynamic business environment.