While the idea of hiring freelancers may seem like a quick solution to you, it actually involves more work on your part than you initially wanted from outsourcing. If the main purpose of outsourcing is to not worry about the small stuff and trust your service provider to do the work right, then shouldn't you be spending your days meeting new clients and improving your business rather than micromanaging home-based workers in another country? For those new to the idea of offshore outsourcing, consider the following pros and cons of managed services outsourcing and freelancing.
#1 Companies that provide managed services outsourcing usually cover the whole process from hiring and training new recruits to employee and facilities management for their clients.
Offshore service providers usually provide full-service outsourcing to their clients. It's an industry-wide formula for providing "no worries" services that clients wanted. Service providers compete with each other in upping the quality of their services and building a name for themselves in the industry. That's way more added value to work provided by independent contractors you'll often find on websites like Upwork.
#2 Most outsourcing companies provide on-site managed services, which assure clients that their offshore staff will be guided and monitored while doing their work.
One of the main concerns of businesses that outsource is the management of workers. Will they need to assign someone to keep an eye on them through a web cam? One of the things that make an outsourcing company a better option to hiring freelancers is the guarantee that they already have an on-site managerial team whose main focus is managing the employees and keeping clients updated with their work.
This team is a cross between the nanny-slash-governess and your own managerial staff. They report to you, and make sure the work is done according to your specifications. Your outsourcing staff work for you like they're your regular employees, but they're not part of your roster, so you don't need to pay for their taxes and healthcare benefits, among other things. That's the job of the on-site management team.
#3 Hiring home-based workers may seem like it's cheaper, faster and easier to accomplish, but it's not.
Many entrepreneurs think that freelancers are better because they're cheaper and less demanding. And, hiring them through websites like Upwork may seem faster and easier compared to negotiating with an offshore service provider and going into a business relationship that may last 3 to 6 months. The truth is you'll be wasting a lot of time poring over resumes and figuring out whether the candidates were being honest about their experiences or not.
This is why outsourcing companies provide managed services that include recruitment and employee retention strategies. They understand the job market in their own country; they know the quality of labor you'll be hiring. The workforce already has the basics down pat, and companies provide additional training only for specialized work and for using technology that's related to their job.
#4 Hiring home-based workers is a good idea when you only need something done for a short period.
Most businesses hire freelancers when they only need something done for a short while, such as building a website or constructing a new office building. Companies would rather hire customer support staff when the demand for their services increase. This usually happens when the company starts to grow with more and more people becoming customers. Sometimes, additional staff are needed for seasonal ramp-ups.
#5 In truth, most freelancers are not as skilled or experienced as they claim to be.
They may need a little more hand-holding than you expected. This means you're expected to provide a few weeks of training along with video tutorials, PDFs and articles they may need to study while adjusting to the daily pace of work you've set for them.
Micromanagers will certainly love this level of attention vested on a couple of workers. But, when you have more important things to do than guide someone through a step-by-step process doing the job, it's not practical anymore. Your time is more valuable than an independent contractor's, and you need someone who'll immediately understand what to do after you've given him or her instructions.
Outsourcing to an offshore provider takes away the burden of training your staff and making sure they got the steps right. Your partner-provider will also ensure you're updated with the progress of your staff.
Offshore outsourcing in the services sector vastly differ in function, motivation and results than offshoring or outsourcing in manufacturing.
The impact of outsourcing of business processes on the jobs market isn't as devastating as offshoring of manufacturing processes. Many small businesses that outsource choose to augment their internal staff with offshore workers rather than simply replace them.
For companies with deeper pockets, they would rather build captive service centers than hire a third-party provider because it's cost-effective to directly manage a call center under your corporate brand. It also expands their market reach from serving North American customers to those living in Asia, Australia and Europe.