Employers are increasingly looking for top talents beyond physical locations as the mobility of the global workforce grows. In the modern talent landscape, location limits access to the best employees, and offshoring is fast becoming the standard to get tasks done and goals achieved.
Today, outsourcing is the business strategy for rapid growth, from small businesses to bigger enterprises, and outsourcing is no longer to local specialist firms and agencies but across continents, utilizing real talent for less, and time zones to get work done or customers taken care of while you sleep.
Enterprises and Market Insights
By sourcing talent abroad, businesses broaden their talent pool and discover the perfect applicant with the right skill set.
Successful companies that outsource
Outsourcing occurs on a global scale and with companies of all sizes, many of which you are likely familiar with. Here are some of them:
- Slack outsourced everything from the ground up. Starting from their logo, their brand colors, and their marketing design to the software for their web and mobile apps. Slack partnered with MetaLab to turn their simple prototype into an exciting app today.
- Whatsapp outsourced its entire app development to cater to android and iOS users. Their initial development was outsourced to a Russian independent contractor, Igor Solomennikov.
- Google solves its capacity issues by outsourcing a variety of tasks including programming, email support for products like AdWords, and more. Google is expanding this by adding customer support with global workers. Their outsourcing partners include Arteria, Atento, Cognizant, Concentrix, Regalix, Teledirect, Teleperformance, and more.
- Cisco System rose to worldwide prominence with its company strategy of recruiting top engineers from India and China. Tech Mahindra is one of their partners collaborating with the company to provide IT infrastructure.
- American Express outsourced customer support to India and the Philippines. Their partners include Spectramind, Infosys Ltd., and Tata Consultancy Services.
- Microsoft’s outsourced workers are equal to the number of on-site employees the software company has. They hire freelancers to do work outside their employee’s purview or competence. When testing out the gaming market, Microsoft outsourced to Flextronics to produce systems.
- Apple excels at what they do by farming out the production and distribution of its products to service providers. They partnered with Accenture for IT consulting and IT solutions.
Trends in outsourcing
Aside from permanently shifting the workplace into mobile and digital, outsourcing saw–if not pioneered– positive trends in the job market.
- Global outsourcing increased women and minorities in leadership roles to focus on diversity. This is also a strategy to attract employees.
- Companies add upskilling and innovations in talent programs, flexible work arrangements, and work-life balances to their employee retention strategy. This is to avoid another great resignation.
- Enterprises are outsourcing automation and cloud-computing programs for process efficiency and standardization.
Customer service function is still the most outsourced business operation since 2019. Enterprises outsource due to the lack of self-service capabilities, making waiting lines for customer support quicker, and the inability to resolve some customer issues.
- IT, Finance, Tax, and HR outsourcing revenue grows annually. Reporting and analytics and user-centric responsibilities are also in demand by small businesses for faster turnaround and efficiency.
Companies opt to outsource for many reasons, usually related to growth and cost efficiency. Increased efficiency and capacity while focusing on your business core are a few of outsourcing benefits. Outsourcing has now evolved from its starting push in IT and data security as little as four years ago.
- 2018: Enterprises prioritized data security. The rise of automation and cloud computing slowly changes the methods of marketing. Outsourcing companies are investing in tech to avoid information breaches. Global outsourcing spending reached approximately $170 billion.
- 2019: Companies outsourced cybersecurity for data privacy during automation. Service providers doubled their defenses in data protection. With global outsourcing spending of $178 billion.
- 2020: At The height of the pandemic, enterprises focused on digital to keep their business afloat. Businesses flocked toward outsourcing and remote work for existing and new employees. Global outsourcing market spending reached approximately $185 billion.
- 2021: Businesses looked for flexible and quality services. They outsourced resources- updated technology during the lockdown. Market spending on outsourcing reached $202 billion.
- 2022: Enterprises prioritize quality over saving costs with global market spending reaching $212 billion. Outsourcing became a competitive market with increasing remote agencies. More businesses have increased awareness of global teams.
Outsourcing international talent costs by task
More enterprises, big and small, wised up to the advantages of outsourcing to an international talent pool, especially for tasks with far cheaper rates in other countries.
Here are the most popular, outsourced tasks offshore and their average outsourcing costs.
- Web development: North American web developer rates range from $150-$200+ per hour. European service providers of web development can be bought from $70-$90 per hour. Eastern Europe and Southeast Asian web developers’ rates are between $15-$50 per hour.
- Customer support: Outsourcing voice or non-voice support can cost between $6-$55 based on region. Customer service representatives from the United States or Canada have average rates between $20-$30. In contrast, Filipino customer service reps with their neutral accents have rates ranging from $5-$15.
- Content Marketing: North American content marketing monthly rate can go from $3,000-$10,000. Asian and Latin American content marketers have lesser rates between $10-$30 per hour. They are also easier to outsource to because they have good accents and fewer cultural barriers.
- SEO: You can outsource SEO specialists from the USA for $750-$3000 per month or $50-$100 per hour. SEO packages in India can start from $35-$70. South East Asia you can hire SEOs from $10-$30 per hour, with prices based on the project scope.
Your quotes can vary from your goals and your timeline to your chosen service provider. Rates on other tasks or digital services can be lesser or greater depending on the difficulty of the work and what countries you choose for outsourcing.
Top countries for outsourcing
You can post your job posts online or look for service providers on marketplaces. When it comes to outsourced freelancers and specialized agencies, these countries are trusted, with decades of experience in several industries.
- The Philippines is the ‘call center capital of the world’ and one of the best countries for outsourcing services in Asia. International companies like Microsoft, IBM, and Wells Fargo, outsource to the country. They are extending their reach to other digital services aside from customer support.
- India is the second country on Tholons Top 50 digital nations list second to the United States. The country is recognized for its quality software development, software engineering, and BPO services along with the Philippines.
- Mexico is the nearshoring destination for US-based companies. They have similar time zones and proximity to the United States suitable for outsourcing manufacturing services.
- Ukraine is one of the delivery destinations in 2021. They are abundant with tech graduates and IT professionals. Their most outsourced services are software development and IT-related services.
- Brazil’s most outsourced services are business process and software development services. The country is the top outsourcing location in Latin America with advanced tech infrastructure.
Why an international talent pool is the popular outsourcing option
Outsourcing’s popularity is more than cost-cutting. The BPO market value expects to reach $620 billion by 2032.
The number one reason businesses outsource to specialists in Southeast Asia and other regions. You can keep costs down and pay for exactly what you use. Compared to the expense of hiring and training on-site employees, or hiring local agencies, this is often a more economical option. With hundreds of English-speaking countries to choose from, there’s no language barrier to contend with.
Enterprises can remove overhead costs like an office, equipment costs, talent acquisition costs, and benefits from expense budgets.
Access to target markets for business growth
Alibaba reached their international audience by outsourcing to English-speaking service providers. Similarly, Google outsources for international talents across different countries for customer support catered to natives by outsourcing.
Getting experts in the fields where you need them gets you on the ground and closer to your goals.
International brand image and visibility
Hire internationally and it’s an instant international brand image, effortless and at no extra cost. It’s also a badge of honor, having a diverse employee base without borders.
24/7 coverage and productivity
Work never slows down. Businesses reap the rewards of increased productivity and streamlined processes when they outsource to service providers with opposite time zones or flexible agents to work while you sleep.
When your in-house team is off-hours, your international team clocks in.
Customized solutions from niche specialists
Recent outsourcing trends trace back to companies with higher standards for service they receive. Higher standards in flexibility and communications, which international outsourcing partners provide. Scale up and down as needed, and populate a team with specialists you need, from social media marketing to web development, without having to hire separate agencies and packages for each.
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