More and more companies are looking towards outsourcing and offshoring as cost-effective options to start or expand their business. Offshore staff leasing is one type of staffing that merges the two concepts. It allows owners to lease or rent professional services from a third party provider. These services range from locating and setting up an office space in the Philippines to recruitment and payroll management. The employer can also ask the provider to train the employees or to find employees that have the proper qualifications.
This setup, however, still poses several business risks. One is failure to establish a good business relationship due to cultural differences and communication barriers due to distance. Another is potential breach of intellectual property. Sharing too much of your business practices to a third party can leave you vulnerable to intellectual property theft. And lastly, failure to meet project requirements and ensure smooth business transaction. Hiring an inexperienced provider and being unable to properly communicate business requirements are common causes of project failure in offshoring and outsourcing.
Mitigate risks with proper planning and coordination
You can avoid these risks by choosing the right goals, conducting research about the country or company you will be hiring, and selecting which processes you would want to outsource. Here are some of the things to consider before jumping into offshore staff leasing:
- What is the main goal of your company?
Do you wish to increase sales margins and decrease operational costs at the same time? Hiring people with lower professional rates could help you achieve this, however, this option can also cost more in terms of setting up the office space and recruiting the employees. Conduct a cost comparison analysis to find out if leasing employees is the best option for your company. This can also help you see if the savings you would get is worth the effort of moving or expanding the operations in a different country.
- Which parts of your business would you outsource?
You wouldn’t want to lose your competitive edge because you outsourced services which your new employees are not yet ready to take on. Perform a test run with your third-party provider — start by assigning them minor tasks and then observe how they perform before assigning the entire project or business line.
- What are the skill levels of the people you need to hire?
Bear in mind that Filipinos are smart employees, but most of them do not have some of the skills and experiences needed for some tasks. Make sure you provide room for training to ensure that their performance meets your business needs and expectations.
KMC Solutions can help you decide if offshore staff leasing is something that your company needs. Contact us today to know more about expanding or moving your business in the Philippines.