Offshore Outsourcing Services – Technical, Administrative & The Economics
Managed technical and administrative offshore staffing services.
Cost effective, skills based, educated, loyal, full time employees sourced from the Philippines.
Build your business, reduce your costs and administration. Whether you need complex administrative tasks performed or technical development work done, adding qualified staff who reside in the Philippines can be a boon for any business.
If it can be done on a computer via the internet, it can probably be done by a Filipino.
Offshore Outsourcing Services From The Philippines; First Let’s Answer Some Questions
Ever considered hiring off-shore staff for your business? If you have, then here are some of the questions that probably immediately spring to mind.
- What are the economics of hiring staff outside of the States?
- What are the risks of having employees in another country?
- There must be a catch, what is it?
- What are the politics of hiring non-Americans in my business?
- Are there any best practices for managing off-shore people?
- What are the language issues with employees from another country?
- Where do I start and how do I get educated in order to have my own off-shore staff?
- Are certain countries better than others for off-shore staff?
- What are the challenges with having off-shore employees?
- What does Holistic Web Presence’s offshore outsourcing services include?
- What does Holistic Web Presence’s offshore outsourcing cost?
- Why should I use Holistic Web Presence’s services, can’t I do it all myself?
- What are the types of jobs that off-shore staffing work best for?
Below we will attempt to answer all these questions and many more. If you have a question that we have not answered yet, simple call us at +1 (801) 349-8226 or complete our simple ‘Ask a Question‘ form.
Why We Provide Offshore Outsourcing Services and Why We Are Qualified to Provide It
We have been successfully hiring and managing off-shore staff for our own business for more than six years. As some of our clients have learned that we do this, they have asked us if we could provide this service to them. Bear in mind that in a number of cases, they have found themselves communicating directly with our off-shore staff. They have been amazed with the quality of work and technical expertise of some of our staff.
Are there any best practices for managing off-shore employees?
Yes, here are some of the most important aspects of managing off-shore staff. Where we have seen other hiring companies not do well, that failure has commonly been attributable to their inability to follow the guidelines below.
Learnings for Managing Off-shore Staff
- Daily Reports – Set expectations from day one that you will require a short summary of what your employee has been doing at the end of each day. Even if that email is no more than, "I did not receive any work today". They should still report. Usually, all communication is going to be done via email and possibly occasionally by text chat. Given that is true, this is especially important.
- Timely Responses – Make it a priority to reply to questions and requests for resources the same day you receive them. Do not leave your employee hanging, waiting for a response.
- Reviews – Review your employee’s performance on a regular basis. We typically do reviews at 1,3,6 and 12 months in the first year. Thereafter at 6 monthly intervals. From the employee’s point of view, when you are working for a company remotely, feedback becomes very important.
- Busy – Make sure you keep your staff busy. A lot of businesses hiring an off-shore person for the first time are surprised how much work they get through. One client of ours that wanted a full-time employee was stunned to realize that they had completed all the work they had lined up for them in just one week. It took them almost four weeks to figure out what else to give them. By then, the person had gone off and found another job.
- The First Month Is A Test – In the first month of hiring a new employee, make sure you give them a task that is challenging and indicative of the work they will be doing long term. You really want to be able to ascertain in the first month if they are up to the job. The worst thing you can do is to ease them slowly into the work and as a result, not be sure at the end of their first month, whether they are going to work out.
- Training – Provide good quality training on what you want your new employee to do. And encourage them to ask questions.
- Screen Recording Videos – We strongly recommend you learn to create simple screen recording videos so that you can show your employee what you want done and how you want it done. One instructional video is worth 10 emails.
- Feedback – Everyone craves encouraging feedback. Sometimes one little bit of praise will spur an employee to work harder. It will certainly help them to feel good about the work they are doing and improve their confidence in what they are doing. This is especially true for off-shore staff who will not know how you feel about the work they do unless you tell them. Do this often. Filipino staff generally want a secure full time job. Job security is important to them. It is our experience that staff who feel appreciated and secure in their work are very loyal employees. Conflict, insecurity, highly competitive and high stress environments may sometimes be a model for U.S. companies. In our experience this does not work with off-shore staffing.
- Mini bonuses – When a member of your off-shore staff does a good job, solves a problem creatively, or simply gets more done than you expected, a small ad-hock bonus goes a long way. A 2,000php bonus is roughly equivalent to $40. Be generous, these amounts make a significant difference to Filipinos.
Are certain countries better than others for off-shore staff?
We hire staff exclusively from the Philippines. We do this because we have found that the Philippines is the best source for consistently finding staff that:
- Are loyal
- Well educated
- Hard working
- Speak and write good American English
We have not found these attributes to be consistent in some other countries. In addition, each country you deal with will have it’s own set of ways of doing business, a unique culture and practical challenges such as dealing with banks and payroll. By focusing our efforts on one country, the best country for staffing in our opinion, we gain a lot of efficiencies and avoid surprises.
Note, that all our other answers are based upon the assumption that we are exclusively talking about staff in the Philippines.
What are the economics of hiring staff outside of the States?
There are two things to consider here, salary and benefits (loading).
Salaries – are negotiated and vary just like they do in any country. However, in order to give you a rule of thumb here are some typical numbers. For high quality, experienced, degree level, technical people, working full time (40 hours a week), you can expect to pay anywhere from $600 – to $1,000 a month. In the U.S. salaries range $3,000 to $7,000 per month.
In general, you are likely to find that the cost of an off-shore employee will be about one fifth or 20% of the cost of a U.S. employee.
Benefits and Taxes (loading) –
There are none. Yep, you heard me, none! Nada, zilch, zero, one less than one. If you have staff in the U.S. you will be familiar with the need to calculate a ‘loading factor’. This loading factor calculates the real cost of having an employee once you have taken into account several layers of taxes, general benefits and various types of insurance. On average this adds somewhere between 18% to 26% to the real cost of an employee.
Therefore, once we take ‘loading’ into account, the cost of an off-shore employee will be closer to about a sixth or just 15% of the cost of a U.S. employee.
This does not mean you should not look after your Filipino employee; vacation time, sick pay and bonuses all go together to make for a very loyal and positive relationship with your off-shore staff. Given this differential though, we find that it is very easy to be generous in this regard without dramatically impacting your staffing budget.
What are the risks of having employees in another country?
There are of course risks associated with hiring off-shore workers. When you have an employee in another country, your recourse, should the worker do something inappropriate, will be limited and much more difficult than if that person resided in the U.S.
Just as when you drive a car you put on a seat-belt and or choose to drive a car with airbags, there are many things you can do to reduce your risks when maintaining off-shore staff. Developing a track record with a new employee before sharing confidential information, limiting access to only needed systems, a good hiring and management process, are all good and sensible precautions.
Working with an agency such as Holistic Web Presence who are experienced in hiring and managing off-shore workers is a prudent strategy. At Holistic we have been working with Filipino’s since 2010. In all that time we have had only good experiences with our off-shore workers.
Having said that, we have seen a number of other companies have a range of bad experiences that range from just getting poor work output through to staff that have simply disappeared. We have also heard about much more extreme cases were staff were hired from other countries.
- We believe that with good management most of these problems can be avoided
- We believe that hiring workers from the Philippines reduces risk due to the country’s culture
- We believe you too can have a first-rate experience with Filipino workers
There must be a catch, what is it?
We have yet to see one. If you find one let us know.
The closest we can come to suggesting a catch is that your off-shore worker is 100% remote. Also they are usually working when you are sleeping and sleeping when you are working.
To be successful with off-shore employees you typically have to learn to be more organized, learn to leverage technology and possibly learn to communicate differently than you do with your U.S. workers. However, if you can adapt, we suggest that all these things will help you grow generally as a business owner or a manager.
What are the politics of hiring non-Americans in my business?
Believe it or not we have occasionally been accused of putting Americans out of work. Do we? Do we really? Does the process of hiring off-shore workers mean that there are Americans who would have had that job? Good questions, let’s explore the reality.
Business Growth Means More Jobs
Holistic Web Presence as a business owes its existence to off-shore workers. Consequently our U.S. employees owe their jobs to off-shore workers. Since we started seven years ago, we have employed Filipino’s to help us get technical work done as well as content created. We now have seven U.S. employees and have helped numerous clients to grow their businesses. In most cases, those companies (our clients) have grown their businesses and as a consequence hired new people or sub-contracted additional work to U.S. people.
A quick calculation across our client base tells us that there at least twenty five Americans that we know of, that are in work directly attributable to our clients’ growth. While we do not claim 100% responsibility for their growth, we have been, without doubt, a major factor in it.
Very recently I was talking to a web developer, an individual, not a company, who was looking for a job with us. I told him that all our developers are based in the Philippines. He did not like that answer at all and accused us of making it difficult for him to get a job.
On the face of it, thinking about this only shallowly, it might seem like he had a point. But did he really?
Reality – the average growth rate for all occupations 2014 to 2024 is 7%. The average for web developers in the U.S. is 27%, much higher than average. Yet this guy couldn’t get a job…
My suggestion to him was, why didn’t he hire Filipino developers himself and manage a team of web developers? He would be able to offer an extremely competitive service that way.
By being a web developer himself he would be in a much better position to manage the quality and pace of the work his staff did. He could easily build a company without having to do all the work himself. He did not however like that suggestion, "I don’t want to manage people, I just want to code" he said. "Well" I replied, "I don’t want to manage people, I just want to drink beer, problem is, I doubt my clients would pay me to do that!"
Reality – this person was cranky, communicated in a negative way and tended to look at all the problems associated with a situation, rather than solutions. I would not have given him a job even if I was out to hire a U.S based developer!
The reason he could not get a job probably had nothing to do with demand for web developers. Much more likely it was more about his attitude. It was much easier for him to blame external circumstances, such as the fact that we, one small company, have off-shore developers, than to take responsibility for his own problems.
Some People have a Scarcity Mentality, some have an Abundance Mentality
A scarcity minded person might think that there are a limited number of jobs. That each time an off-shore worker is hired, an American is put out of work.
An abundance minded person will likely suggest that there is an infinite amount of growth possible for the economy, for individual businesses and for individuals if they have the will, the creativity and the ability to see the opportunities.
We live in a global competitive economy, if Americans can find ways to get things done more efficiently and creatively than other businesses in other countries, then the possibilities for growth and therefore jobs are infinite, not finite, not limited to a specific number.
Just consider the growth rates of companies such as Google, Apple and Facebook. These companies along with many others, have created jobs out of thin air. The need for the product and services they offer simply did not exist before they invented them.
Google alone employs in excess of 60,000 people Worldwide. Roughly 40% of which are Americans. Yet Google have stated that one of the key’s to their success is foreign workers. This means that somewhere in the region of 20,000 U.S. workers at Google literally owe their jobs to foreign workers.
Making use of the diversity of workers, such as women, people with different ethnic backgrounds and people from different countries, ultimately create more jobs. They do not suck up available jobs from a limited supply of jobs.
Jobs are created, they do not come from a limited source.
There are no limits to the amount of jobs available to Americans. However, jobs are competitive. It is up to every individual to make themselves attractive and to understand what companies need.
Ask Yourself This Question
If you were to make use of our services and gained your first off-shore worker, would that cost saving help you to grow your business? If you are able to grow your business, are you more likely or less likely to ultimately hire more U.S. people?
What are the language issues with employees from another country?
There is no doubt that language issues can cause poor communication, misunderstandings and wasted time. Problems like these will often get in the way of productivity and in general realizing a good result when hiring off-shore staff.
At Holistic Web Presence however, we rarely fall prey to language and communication problems. Experience has taught us how to avoid those problems. In summary, here is how we do that.
- We hire exclusively in the Philippines.
- In general Filipino’s speak and write in good American English. They are taught this in school.
- We hire first for the quality of their English writing skills.
- We hire second for the candidate’s ability to communicate well and follow detailed instructions.
- Depending upon the specific role we are hiring for, we have different tests we require candidates to perform as part of the application process.
- We hire off-shore for the right kinds of work.
- Except under certain circumstances, we do not believe in hiring off-shore for telephone work. This is because most U.S. people get irritated when they think they have gotten through to, or been called by, a person in another country. Practical problems include poor line quality, an obvious delay, heavy accents and a lack of understanding of local colloquialisms. All these things make it much harder to communicate.
- Learn about the types of jobs that work well with off-shore staff – coming soon
Where do I start and how do I get educated in order to have my own off-shore staff?
To get started call us directly +1 (801) 349-8226 or complete our enquiry form. We will start the process for you. We can also advise if you need help to understand whether the job of work you have in mind will work with off-shore workers.
By working with Holistic Web Presence, you are able to bypass the normal trial and error necessary to recruit and gain long term off-shore staff. We handle 90% of the legwork associated with the hiring, payroll and management processes for you.
You can concentrate on defining the work you want your new staff to do. We will provide you with training and support regarding the best way to describe the job for off-shore people, and how best to performance mange them. You will not need to worry about anything other than the work you need to get done.
What are the challenges with having off-shore employees?
Most of our clients are surprised as to just how easy and quick it is to add off-shore workers to their workforce. You will need to learn how to communicate effectively with your new remote staff. We provide full training on the most effective tools and methods we have learned to use when managing off-shore workers.
You will not need to worry about transferring money overseas, currency conversion, changing rates, getting the funds into your staff’s bank accounts on time. You will not need to worry about negotiating competitive salaries, advertising, reviewing hundreds of resumes, local cultural differences, holidays, language competency, equipment purchases, payroll taxes, insurance and many other challenges that normally go into hiring and managing staff.
What does Holistic Web Presence’s offshore outsourcing services include?
Holistic Web Presence provide a full service off-shore outsourcing solution.
- We recruit – help with the job definition and description, advertise, interview, skills test, negotiate salaries and provide highly qualified candidates for a final interview
- We consult – identify nature of rolls that are likely to work well as off-shore outsourced jobs
- We train – help employers provide training for their new staff using up to date tools
- We manage – help employers’ performance manage their new staff
- We budget manage payroll processes – transfer funds overseas, bonuses and raises
In short, we do everything except actually give the off-shore employee the work
Employers are charged one manageable annually set monthly flat fee