Outsourcing is now taking the world by storm. Many, if not all, companies are looking towards outsourcing for a lot of their services. This is most notably seen in the customer service sector. Right now, there are two types outsourcing to note and these are Onshore and Offshore outsourcing. Both have their own merits. Don’t know which one will fit your company better? Read on to know more.
Firstly, let us define Outsourcing in general. It is the process of hiring external or third party agencies to do a particular task for different reasons. For example, you’re a business and you need people to handle your customer service. Instead of hiring, training and coaching people, you hire an external agency to do your customer service for you. A company outsource because they do not have the resources or the manpower to successfully handle a department such as their customer service. Other companies outsource to cut their expenses because it is much more cheaper to hire other people than to train on their own.
The type of outsourcing a company utilizes is mainly dependent on their need and their own resources.
One of the less known type of outsourcing. To define simply, onshore outsourcing is the hiring of an external agency to do tasks for a company and at the same time, they are both located in the same country. This is usually the best option for a company who have to oblige with strict legal and operational requirements. Quality is greatly emphasized in this setup but it is more costly than offshore outsourcing. It is also easier for a company to monitor and go to this external agency. Another pro is that the company’s customers will most likely speak to people with the same cultural background to them. Do you think that this is the best choice for your company?
Offshore outsourcing, on the other hand, is perhaps one of the most popular type of outsourcing there is. It is notably far cheaper for a company to utilize offshore outsourcing rather than onshore. This is because most offshore outsourcing companies are located in countries where labor and technology is cheaper than in most first-world countries where most major companies are located. In definition, offshore outsourcing is the hiring of an external agency outside the country where the main company is located. Hence, “off” shore. A lot of companies opt for this setup since most offshore outsourcing companies produce a high quality of service with minimal effort. Do you think that this is the best choice for your company?
There also businesses that choose to hire both onshore and offshore outsourcing companies. Again, whether you choose onshore or offshore outsourcing, it greatly depends on your company’s resources and need at the moment. So take time to think on what you really need.