The exact strategy to double profit using an offshore team – Part 2
Thursday, January 21, 2016/
Last week I discussed why a strategic plan is so important in initiating offshoring, and outlined how the plan necessarily varies from one business to the next.
Below is a summary of what the Easy Offshore complete strategy report contains. Typically we would develop this strategy with a client over the first one to three months, then execute over 12 months. You can use this as a guide to build your own strategy but be aware that if you don’t have the insight to complete a section, you should anticipate unexpected problems to arise in those areas.
Your strategy report should address all the common causes of offshoring failure. It should also examine your particular situation and scope since every business is different.
Even between seemingly similar businesses, underlying differences can impact the success of global-resourcing. Issues like motivators, company culture, management alignment, management capacity, current quantity of office locations, local cost and availability of talent, current cash flow and current profit and your attitude towards risk. Here is what we consider in our report:
- Initial Discovery:
- Management Readiness: Identify and discuss all concerns, assign a champion.
- Initial Tasks/Roles: Round-table discussion with initial thoughts on tasks and roles.
- Initial workshop on offshore outsourcing theory, including top ten causes of failure.
- Desirable Outcomes: Align the management team on the goals.
- Summary of Philippines Strategy Tour:
- Pre-tour Workshop on the 9 different outsourcing models, shortlist of most relevant.
- Overview of Philippines & BPO sector: key information, demographics and statistics.
- Debriefings of 6-12 facilities inspected, and your completed facility scorecards.
- Insights and value from the tour.
- Analysis and decision on shortlisted facilities, and analysis of facility contracts.
- Strengths, Weaknesses, Opportunities, Threats: SWOT Analysis.
- Risk Mitigation: Addressing all identified risks associated with your business offshoring.
- Costs and Savings Schedule: Expected set-up costs, net savings and cash-flow impacts.
- Comprehensive list of market salary rates for all required skillsets.
- Comparison of overhead/office/seat costs, local versus Philippines.
- The Internal Sell: Recommendations for informing your local team to get their support.
- Phase 1 / Phase 2 Tasks and Roles: Identifying the best tasks to shift; building suitable roles.
- Recruitment, Induction and Training: Building a strong offshore team is crucial to success.
- Technology & Security Analysis
- Infrastructure Control, Data Security and Physical Security
- Hardware and Software
- Phase 1 Planning: Any projects and actions required before commencement
- Technology Role Requirements: what apps, data and security is needed for each role
- Three-Month Progress Analysis: Any changes needed to providers, recruitment, training, tasks.
- Six-Month Progress Analysis: Any changes needed to local management, training, and tasks.
- Nine-Month Progress Analysis: Any changes needed, and preparation for Phase 2 deployment.
All of the above is included within our typical offshoring strategic plan. Of course, planning and implementing are two different things entirely. Typically we will work with a client over three months or 12 months, depending upon the scope, to ensure implementation tracks to the plan. We also provide a valuable 30,000-word implementation manual based on years of compiled research.
What you should also do with implementation is ensure you have weekly management phone conferences, particularly over the first three months. This keeps the strategy on track and also gives us the opportunity to correct mistakes early, and draw attention to key parts of the implementation guides if the content has been forgotten. So a few months into implementation, when the initial lessons are starting to get forgotten, we often have conversations like this:
“Actually Geoff, the way you’re managing that issue with the team is going to cause further problems. There’s a cultural difference at play here – if you crack down on it with an Australian mindset you’re going to make it worse. Family comes first to a Filipino, and it’s best not to compete with that. In fact, the more you support family, and appear aligned with family values, the better team result you will get.
You need to give the team member greater flexibility to take time off over the next month to get the family issue resolved, even though the issue seems trivial to us. I suggest that the entire management team re-reads the Cultural Briefing chapter of the manual again – it discusses this issue, and shows how to merge Australian expectations of productivity and punctuality with a Filipino commitment to family.”
Every hour you spend planning your offshoring is an hour well spent. Your time is valuable and has a cots, but if you were to spend one quarter of your first year’s savings on preparing a strategy that ensured a faster and lower-risk rollout, wouldn’t that be an obvious thing to do?
If you don’t understand the details, offshoring of knowledge-worker roles can feel new and adventurous, so it’s easy to fall into the trap of assuming it’s simple. But if you want great results the FIRST time, then do what great businesses do, and plan to succeed.
Scott Linden Jones is the founder of consulting firm Easy Offshore, which assists businesses with offshoring and outsourcing, from startups through to publicly listed companies.