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How to Increase Productivity with Offshore Outsourcing

Author: Gretel Digo

Posted: November 21, 2014

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Productivity is the ratio of output to input.  Given the same amount of resources, company A is considered to be more productive than company B if company A creates more products or services than company B.  According to the U.S.  Bureau of Labor Statistics, outsourcing services or production to local providers can change the distribution of production.  Offshoring can also affect business sector productivity if offshore workers are more productive than local workers, or vice versa.

Most companies outsource because they save big money on labor, overhead and related costs.  Other benefits of outsourcing are improved quality and productivity.  You get better quality when you partner with a company with extensive experience in a particular area.  You also gain access to the latest technology and efficient processes offered by outside experts.

But how does outsourcing increase company productivity? When you outsource to a competent and skilled professional or third party, it's like cloning your in-house team.  You double your resources (particularly if you outsource to an overseas provider) for way less than if you hire full-time workers, and you free up time to focus on what you do best.

Why You Shouldn't Do Everything

Some entrepreneurs and small business owners feel a loss of control when they are not managing every aspect of their business.  But if you are spending precious time trying to perform every single task, you risk being underproductive.  Remember that productivity is doing more with less, not simply "doing more."

For example, if your hourly rate as an app developer is $90 per hour, and you spend five hours a week on paperwork and payroll, you are an overpaid clerical worker.  If you outsource these necessary but grueling tasks to someone who charges $60 for the whole thing, you save $120 a month! Besides the savings, you can increase profit by making new apps instead of working on non-revenue generating activities.  And because of the lower rates, you can hire large number of people, multiplying productivity even further.

Outsourcing is much more than a cost-cutting tool; it is increasingly seen as a strategic tool.  By outsourcing certain activities, you minimize risk.  When problems arise, the third party provider share accountability with you.  You don't need to invest in expensive equipment, infrastructure, technology, office space and maintenance; the provider takes care of these.

If you're stressed out from trying to juggle multiple things at once, and it's taking a toll on your productivity, consider outsourcing.  To find out if outsourcing is right for your company, identify your strengths and weaknesses, and tasks that you don't enjoy doing.  The key is to determine whether a non-core task could be performed by a third party at a lower rate, more quickly and efficiently.

Offshoring and Improving Productivity in Key Areas

Can't decide which tasks to outsource? Ask yourself why you went into business in the first place or your mission as a company.  Then list activities that you need to do but don't generate revenue.  This can be answering emails, website design, updating social media, making presentations and reports, HR, payroll and IT support and maintenance.  Tasks that you hate doing can be outsourced as well.  When you and your staff enjoy the work and you are fully immersed in it, you are more productive.

Here are some key tasks that can be outsourced to improve productivity:

  • Payroll
  • Payroll is one of the most obvious tasks to outsource.  It is far too labor-intensive and grueling, and requires specialized skills.  Even if you enjoy tracking attendance and doing taxes, your time could be better spent on growing your company.  Outsourcing payroll could also improve employment regulation compliance and minimize HR issues.

  • Human Resources
  • Like payroll, HR is not something most companies can claim as a core competency.  Instead of hiring full time staff and building an HR team (very expensive), partner with an experienced HR and recruitment company that serve businesses in your industry.  Outsourcing HR processes increases productivity by speeding up the recruitment process.  The sooner you fill an open position, the more productive your company will be.

  • Information Technology
  • Information technology services range from infrastructure to management to support.  Instead of overseeing IT process, partner with an experienced IT provider to keep your in-house staff focused on the essentials.  Outsourcing IT also boosts productivity and efficiency by giving you access to the latest software, hardware and processes without worrying about upgrades and maintenance.

  • Healthcare
  • The healthcare sector is in for a big change with the upcoming ICD-10 implementation.  Many businesses are investing in healthcare IT outsourcing for a smoother transition from the old system to the new.  Consider outsourcing IT and healthcare services to better prepare for ICD-10 and help you focus on your core business.

  • Design and Creative Services
  • You could probably learn to design your company logo, letterhead, promo materials and website, but it would take much longer and the final look may not be as polished as a professional's work.  Outsourcing to website and graphic designers will save you both time and money.

  • Social Media
  • We all enjoy connecting with our customers or fans via social media channels like company blogs, Facebook and Twitter.  But updating and targeting content and converting followers into customers can be time-consuming.  Outsource social media management, content creation and related tasks so you can do what you do best.

    Boost Productivity by Outsourcing to the Philippines

    Few locations in the world have the right mix of cultural compatibility with the West, a growing labor force that communicates in English excellently, and the lowest prices in the industry than the Philippines.  It is second only to India as a global outsourcing hub, and both small businesses and large corporations have established operations in the country to improve productivity and cut costs.

    Philippine IT-BPO companies make it easy for clients to get started with minimal risk.  You have maximum flexibility when it comes to pricing, the number of people you want to hire and the kind of services that you want to outsource.  Partner with a company that offers custom solutions to make sure you are meeting your objectives.


    IS OUTSOURCING RIGHT FOR YOUR BUSINESS?

    Getting Started is Easy and Risk-Free is a step by step guide that can help you learn more and get started on the outsourcing process.  Or you can have a free, no-risk consultation with an expert .  At Sourcefit, we'll help you explore the possibilities and opportunities.

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