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Lessons from outsourcing to India, China and the Philippines

Discussion in 'Human Resources Management' started by Simon Hampel, 10th Nov, 2016.

  1. Simon Hampel

    Simon Hampel Founder Staff Member

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    Very well written and carefully considered article about some of the issues and benefits of outsourcing (predominantly IT work) offshore from Troy Hunt - based on his personal experience while working for a large company here in Australia.

    Offshoring roulette: lessons from outsourcing to India, China and the Philippines

    While I don't have the outsourcing experience that Troy has had, I have travelled to India and China for work and worked with people from all three countries during my time at IBM and have had an opportunity to observe the interesting cultural differences and differences in expectations, which can lead to issues if not well understood.

    I would be interested to hear other people's stories about offshoring their work - in particular I'm very interested to hear the success stories - what worked well, what you think contributed to it working so well, how you would do things differently get an even better result next time - but also, what type of work you have found works best kept in house.

    Troy's analysis indicated he has found that a blended approach seems to work best - don't offshore all the things, pick and choose those tasks or projects which are suited to that type of environment, but keep the others or key elements of the project in house for better control, long term manageability, knowledge retention, etc.
     
  2. RPI

    RPI Well-Known Member

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    I previously had 2 fulltime staff in the Philippines through the staff leasing model (they recruit, get 3 applicants, you choose the one you want, they answer to you and only work for you).

    It worked well but as I grew I needed more phone answering so brought those roles in house.

    The Filipino's were very well educated, very good at English and very willing to please. So willing to please that you can't ask closed questions, the answer will always be yes. So never ask do you understand what I want you to do, you need to ask them to explain it to you.

    Used to cost me about $1200 a month a person.

    Now costs me $1650 a month to have an Australian based trainee - 18 year old school leaver
     
  3. arrowwise

    arrowwise Active Member

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    As said different cultures, values and common understandings is one of the biggest underlying issues. Some cultures are great at over promising and under delivering as standard practice. Its a sure fire way of not achieving much to any original timeline or budget, let alone anything at all. Many things are best left for Aussie workers, particularly when local culture and English factors are vital.
     
  4. trinity168

    trinity168 New Member

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    I have been on both ends of the spectrum.

    I was outsourced to, back in the Phils, around 2000-2001. The network/internet/VPN connections during that time was not great. It was difficult and challenging setting up the instrastructure. I remember a comment my technical manager mentioned tho, "there's always a holiday in the Phils". I think there is one each month!

    Now, I manage a development team in CN, our datacentre is outsourced to IN. Communication for both instances is a challenge. Have to be clear and specific, and a bit of patiece as, culturally, CN folks just always say 'yes'. IN folks never admit to mistakes, which I refer to as learnings but ... it just does not stick.

    What can make it work? Well, I think what my employer did "works", because they don't deal with the CN and IN folks, they slapped a manager title to my role and I deal with CN and IN folks.

    I agree with the last bit of Troy's blog:
    I also know the the CN folks required bonuses each year, and their rates are not as cheap as when my employer signed up to opening an office in CN. Bonuses are expected culturally, and I think the expectation is 10%. I could be wrong, payroll is above my paygrade.
     
  5. RPI

    RPI Well-Known Member

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    Thanks for sharing trinity.
     
    trinity168 likes this.