Outsourcing to different countries degrades the bottom line

I get it, it is WAY cheaper to outsource your issues to another country. As a country, we do it all the time. However, no matter where your opinion on that statement may land, everyone can agree it degrades every business at some point. The technology field is no different. Almost every business would prefer to outsource to a different country and does not factor in the years of degraded bottom line it will cause. Also, it will not take a full year to figure out that it was a mistake.

If we look at the obvious stress factors such as time differences, language barriers, and the factor that you are not their only client should already make you get a headache. I know it did for me every time a business decided to outsource a technology project out to another country to save, quite honestly, minimal money. I have also seen it make no sense at all that we paid, in most cases, MORE than hiring from the United States. Matter of fact, according to the website TeamSparq https://www.teamsparq.com/blogs/is-offshore-outsourcing-really-cheaper/ India alone has one of the biggest outsourcing industries making over $100 billion per year. That is BONKERS that we have grown an entire industry just to save a little money. However, let’s go back to the ‘saving money’ argument.

Any business that has been around for a bit understands that the bottom line isn’t just built with the money they have in the bank. The bottom line factors in the amount of time it takes to make that money in the bank. ROI, return on investment, only works if you factor the time and labor it takes to make the next company dollar. I have seen in the technology industry this perception that spending less now on a project or the technology that actually helps grow that bottom line and worry about the fallout from outsourcing later. That is one of, if not the one, issue every technology manager or IT department head gets frustrated about. The savings from a dollar stand point does not make up for the time and the hassle it will cost overall. Let me give you a perfect ‘not real’ example.

Johnny is the IT Manager for a real estate firm. They want to make more sales and want to look at building virtual tours for all the properties in their portfolio. This real estate firm is decent in size but really only has Johnny to take care of anything ‘digital’ in the company. A relatable story for most techs reading this blog. Let me tell you what they already know is coming. Johnny is overworked and slammed with already new requests from the owner of the firm. Johnny, like any other IT Manager, decides we should hire someone or maybe even contract out this virtual tour idea. Johnny does his research and looks for local freelancers on the ‘big three’ (Upwork, Fiveer, Freelancer) as well some local people that may fit in the budget he thinks the owner will approve.

Johnny pitches the idea to the owner and the owner has done some ‘research’ as well. They get on Google, they search for ‘virtual tours cheap’ and see that the pricing his IT Manager gives seem very high and would cost more to get the project done. Johnny explains to the owner that the reason the price is higher is because the quality of work and overall hassle of someone not working in the same timezone is worth it. The owner decides to go with outsourcing and Johnny knows that this will probably be a bigger hassle for him. Guess what? Johnny is correct and the project that had a timeline for three months, which the outsourced company projected for, is now six months in. It cost actually more money because the outsourced company said they ‘underestimated the initial project’ or ‘they had a language barrier issue when the project started’ (literally to real life examples of excuses I have heard). Johnny is now having daily meetings with the owner, costing them both time they don’t have, explaining why the project has gone off the rails.

That example of degrading the bottom line to save a few bucks happens almost every day. It also leads your best technology people out the door. To wrap up this post, I want to say that these issues can be resolved. We can all stop giving all of this money to other countries by simply spending a little more upfront and get a better overall ROI.

As a business owner myself, I understand that time is valuable and even thinking about one more meeting each week sounds dreadful. Luckily, you can have someone like myself and my team be your “go to” technology expert and have me go to those weekly meetings. as I am sure you knew that this blog post would have a pitch in it, here it is. Hireageek.online entire business model is to help our clients focus on the business growth while we take care of the technology needed for that growth to happen. Schedule a 100% FREE forty-five minute consultation and see how much easier business technology can be!