Offshoring has become a buzzword that is often discussed by many business executives, industry analysts, and news outlets in the recent years.

While several studies such as the one published by Organisation for Economic Co-operation and Development have already supported the productivity and economic value of offshoring services to an outside service provider, this term still elicits emotion filled reactions from many people these days – specifically, associating this phenomenon with long-term unemployment in highly developed countries.

In spite of the misconceptions and accusations, the offshore outsourcing industry has been much stronger in the recent years. So, what does that tell us?

In this post, we will look at some of the myths surrounding offshore outsourcing and provide evidence that they have no ground at all.

Offshoring is Only for Large Organisations

While it’s true that offshoring has traditionally been a practice of many large organisations, more and more startup owners are also starting to realise the benefits that it can provide not only to their business but to their customers as well. In the past recent years, there is a growing number of Australian SMEs has already sent many of their desk jobs in the Philippines in order to save cost and achieve equal, if not higher level of productivity.

Aside from helping you focus on core areas of your business, in a broader perspective, offshore outsourcing enables you to compete with the market leader by helping you cut your costs. According to research conducted by Deloitte, 45% of respondents see outsourcing as a key enabler of M&A activity, and 41% use outsourcing to lower operating costs of acquired companies. Some other areas which offshore outsourcing can help you save significant cost are utilities, HR management, equipment’s, and overhead costs associated with keeping in-house employees.

Low Price Means Low-Quality Output

Some people are of the belief that collaborating with an external firm means jeopardising the quality of work. The low cost of offshore outsourcing, in their rationale, is evidence that offshore teams are incapable of delivering high-quality outputs in complex programs.

While employing a full team of in-house employees has been the standard approach ever since, this is often impractical and expensive, especially for small business. Also, employing in-house doesn’t guarantee that quality work will be done. High-quality is one of the facets that the offshore outsourcing provider and client must thoroughly plan prior to starting the project and is only possible in an offshore program where you have critical input for your offshore team.

Also, one should keep in mind that the cost of living, and not wage itself, is the basis that most offshore outsourcing firms use to determine how much their offshore worker will be paid. For instance, the minimum wage of a Filipino offshore transcriptionist is around $500 per month. While this amount may seem small on the international scale, but it is well above the rate in the local job market, enough to attract top-notch talent in the Philippines.

Managing an Offshore Team is Challenging

Yes, it is sometimes difficult to work with a remote team, especially if the time zone difference between your offshore team and your business is significant. However, choosing the right offshoring provider can help you lighten the load.

Offshore outsourcing companies like Global Outsourcing provides outsourcing solutions for Australia-based firms, including inbound sales, customer service, data entry, outbound telemarketing, and admin services. What’s unique with Global Outsourcing is that they have a team located in Australia tasked as your account and project managers to handle your offshore team, and serve as local representatives, where you will have a regular face-to-face meeting to make sure that everything remains running smoothly. In doing so, the hurdles of remote management are easily overcome.

Offshore Outsourcing Is Causing the Rise of Unemployment

If we look at the latest report from Australian Bureau of Statistics, the bulk of the mass layoffs occurred in the mining and resources industry. A big number of layoffs were also recorded in electronics, hardware, clothing and apparel sector, as Dick Smith, Woolworths’ Masters, Pumpkin Patch, and Payless Shoes closed their operations last year and in early 2017, at the cost of thousands of jobs.

That said, there is no solid proof that those mass layoffs were caused by companies relocating some of their operations offshore or outsourcing to skilled workers in other countries. Jobs are lost due to several reasons, not just outsourcing.

In the above-mentioned report from OECD, it is highlighted that even the occupations that were potentially affected by outsourcing even experienced strong growth in the recent years. Many of today’s consumer view outsourcing as a part of business growth strategy. If a business can focus on the more important task, they will become more productive and efficient, allowing them to grow their business and create more employment opportunities for the locals.

And that’s it! The top offshore outsourcing myths debunked by data and valid reasoning. Do you think these points were helpful for you? Let us know by calling Global Outsourcing today on 02 8916 6469, or click here to contact us online.