If two words describe the modern business landscape, it’s competitive and fast-paced. With businesses embracing trends and executing strategies to stay relevant, it can be tough to keep up, especially since costs, efficiency, and quality of work can make or break your goals. Outsourcing, of course, can ease the load off your shoulders.
While we have the traditional nearshore, onshore, and offshore outsourcing models, there’s another model to keep an eye on — hybrid outsourcing. Hybrid outsourcing is not just a buzzword, it’s a new outsourcing norm taking companies by storm. This article explores the ins and outs of hybrid outsourcing teams, including how companies leverage the hybrid model for their needs and goals.
The Rise of Hybrid Teams
Companies have continuously relied on traditional outsourcing methods. While onshore outsourcing promises tighter quality control and deeper local knowledge, companies invest more resources in overhead and hiring. This makes onshoring a costly investment in the long run.
The edge of nearshore outsourcing is proximity, allowing companies to work with BPOs in countries closer to their local time zone. However, economic or political issues in your partner country can disrupt business continuity and affect your daily operations. Offshoring may give you the cost savings you need, but language, cultural, and time zone differences can hinder forming an effective partnership with an outsourcing company.
So, how can companies balance out the pros and cons of these outsourcing models? The answer lies in hybrid outsourcing teams. In this context, hybrid teams don’t necessarily refer to hybrid employees working remotely and in the office, but to an outsourcing team that combines onshore and offshore employees.
Hybrid outsourcing is a product of the dynamic, fast-paced changes in the business world. As customer needs evolve and industries become competitive, businesses step out from the comforts of traditional outsourcing models and need the right blend of cost-effectiveness, risk management, qualified talent, and operational efficiency — all of which are offered by a hybrid approach to outsourcing.
More than the competitive nature of industries, local talent shortages are also a driver of forming hybrid outsourcing teams. Employees leave their jobs for higher salaries or a healthier work-life balance. Additionally, high labor costs — while beneficial for employees — can hurt a company’s profits.
In the United States, attracting and retaining talent is a losing battle as businesses grapple with prevailing social issues such as poor childcare access and an aging population. These companies also compete with the rise of digital commerce and entrepreneurship, which promise a higher salary ceiling than employment.
With hybrid outsourcing teams, companies need not scrimp on talent, as they can retain their in-house employees and hire offshore employees to supplement existing skill sets and manpower. Offshore resources are also cheaper, so business owners can still utilize the specialized talent that outsourced teams bring without significant financial investment.
Not only do hybrid outsourcing teams prime your business for success and evolving market trends, they also help foster diversity and innovation.
What’s the Appeal of A Hybrid Team?
Hybrid outsourcing is the sweet spot of onshore and offshore outsourcing, synergizing the inherent strengths of both models to optimize efficiency and cost without sacrificing the quality of work. If your company is planning or transitioning to a hybrid team, take a look at the following advantages of this model.
1. Promotes Better Division of Labor
Not all tasks have to be outsourced. Onshore teams often handle complex and critical job functions. Let’s say your business wants to launch a new product or service. This involves creating buyer personas, identifying the target audience, and knowing potential competitors.
As a business owner, you’ll want to delegate these functions to your in-house staff since they already possess an in-depth knowledge of the local market and provide deeper insights into your target demographic’s psyche. This helps position your business for competition and success.
Likewise, non-critical or time-sensitive job functions such as content creation and social media management can be delegated to offshore staff to free up your onshore team’s workload. When work is evenly distributed, onshore and offshore teams can leverage their strengths to produce high-quality outputs and improve efficiency.
2. Improves Collaboration and Operational Control
Hybrid teams are inherently collaborative. With the help of messaging and video-conferencing software, it’s now easier than ever to schedule weekly meetings and feedback sessions. Through these sessions, business owners can monitor performance, meet project requirements, and ensure the timely submission of deliverables.
Virtual meetings are also a great avenue for embracing diverse yet innovative solutions from your offshore staff. This facilitates better camaraderie and mutual respect between your in-house staff and offshore remote employees.
3. Increases Access to Global Talent
Hybrid outsourcing paves the way for a global workforce. It does not limit hiring to a single city or country. This means exploring a wider talent pool of specialized and highly skilled individuals from different countries. This way, you can quickly close talent gaps and provide the skills your onshore team needs at the moment.
Additionally, hybrid outsourcing teams help reduce expenses due to cheaper labor costs in some countries — especially in developing countries such as India and the Philippines. By employing offshore staff, you get the best of both worlds of cost-effectiveness and specialized, in-demand talent.
4. Helps Ensure Business Continuity
Opting for a hybrid workforce means diversifying your teams. In a perfect world, every day is business as usual. Unfortunately, the world is unpredictable. Whether it’s natural disasters, political instability, or a local health crisis, business owners need to be armed with contingency plans.
The best contingency plan is, of course, building hybrid teams across different locations. A hybrid workforce is your backup plan for when things go awry in your area, allowing your hybrid employees to pick up the pace and continue business operations as normal.
5. Lets You Take Advantage of Time Zone Differences
Time zone differences may appear as a hurdle, but they are a huge advantage in your business. That’s why a hybrid model of outsourcing works so well here. Let’s say you’re a US business building an offshore outsourcing team in the Philippines. The time zone differences between the two countries are around 12 hours.
Hence, when it’s night in the US, it’s morning in the Philippines (and vice versa). Because of the significant time differences, you can outsource customer service or other non-critical tasks to the best Philippine BPO companies for post-US hours support.
While your in-house employees are asleep, your offshore team handles the day’s tasks in their local time zone and submits their deliverables on the dot, ready to be processed and evaluated by your in-house team.
Companies That Have Implemented A Hybrid Outsourcing Model
Believe it or not, but some businesses in the US already have hybrid outsourcing teams — and our round-up is proof of that. Check out how these companies integrate hybrid outsourcing into their operations.
1. Slack Technologies
Slack Technologies is the developer behind Slack, a workplace communication software. This company owes its success to hybrid outsourcing. Slack Technologies has an in-house team composed of talented staff members as well as nearshore and offshore teams in Canada and India.
The collaboration between the American company’s hybrid outsourcing teams was seen during the development of Slack’s Enterprise Grid. The in-house team handled complex job functions, which included security compliance, whereas the outsourced teams dealt with less complex tasks such as addressing bugs and product testing.
The synergy between Slack’s hybrid teams drove more revenue to the company, catching the likes of Oracle, IBM, and other enterprises. Thanks to their efficiency, Slack Technologies streamlined operations while optimizing costs and ensuring faster project completion, which led to a 30% reduction in development time.
Slack’s success with hybrid outsourcing shows how utilizing the strengths and specialization of in-house and offshore teams contributes to increased efficiency and seamless collaboration between diverse teams.
2. WhatsApp
WhatsApp is a messaging app and company founded by Brian Acton and Jan Koum in 2009. Before WhatsApp became a well-loved name today, the success of its development was all thanks to hybrid outsourcing. Back then, the company only had five part-timers and 30 full-time in-house employees.
WhatsApp outsourced the application’s development to a Russian developer, Igor Solomennikov, helping the then-start-up save on labor costs. At the same time, offshore outsourcing allowed the US-based company to focus on what they do best: business and user base growth. This way, the founders and their in-house staff don’t have to hire costly onshore staff or learn mobile app development from scratch.
As Solomennikov developed WhatsApp’s features, Acton and Koum served as testers and quality control staff, making sure the app was high-quality and easy to use. Because of the company’s hybrid outsourcing model, the app became a huge success, with a global user base of over 2.9 billion as of this writing.
3. Microsoft
Microsoft is a key player in the IT industry. As one of the biggest IT companies, it has relied on outsourcing for manpower and resources from Eastern Europe, India, and the Philippines. Commonly outsourced job functions include customer care, internal support, software development, and IT services.
The American company has an in-house team of engineers responsible for software architecture and innovation. These require specialized knowledge, so Microsoft has decided to outsource customer service, software development, and testing to offshore teams. This creates a harmonious balance of strengths between hybrid teams, eliminating the need for resource allocation.
Because of the company’s hybrid outsourcing model, operational and cost efficiency are guaranteed. Software and product updates are rolled out faster, too. Best of all, users of Microsoft’s products also enjoy round-the-clock support, making troubleshooting accessible to those outside US time zones.
4. Cisco
Cisco Systems, or Cisco, is an American tech company known for its security solutions, routers, and network systems. Despite the economic turmoil of the 2008 recession, Cisco relied on outsourcing to get by during this period, demonstrating its resourcefulness and resiliency. Beyond surviving economic instability, the company has elevated its hybrid outsourcing efforts for scalability and effective partnership.
Cisco’s outsourced software development services involve partnering with outsourcing firms in Eastern Europe, a region with a robust IT industry. The company does have in-house IT staff and software engineers, but building hybrid outsourcing teams enables Cisco to access talent with readily available skills in network automation or the Internet of Things (IoT). This encourages scalability and reduces the need to redistribute in-house resources.
Interestingly, Cisco even went as far as to utilize the Entity Support Model (ESM) for global integration of processes. With this model, the company’s finance and accounting functions are split between the Accounting Services and the Global Operations team, with the former handling local compliance and support and the latter handling operational delivery.
Cisco worked with Ernst & Young, PriceWaterhouseCoopers, and even Accenture for tax filings, external audits, back office support, and many more. These partner companies work with each other, too. For example, Accenture can consolidate data for filing by Ernst & Young employees. Cisco’s role, though, revolves around calculating adjustments as well as reviewing and approving tax filings and audit adjustments.
Cisco’s case is a clear testament to the hybrid approach to outsourcing. With the company leveraging the innate strengths of its global partners, it can pool its resources on key job functions without delay. Its ESM model integrates complex functions into one seamless global network, driving operational efficiency and cost savings while minimizing risks.
Build A Hybrid Team With KDCI
Hybrid outsourcing is like working in a group, where each member brings their strengths and skills to the table to complete a project. Or in this case, boost efficiency, adapt to ever-changing business needs, and reduce overhead expenses. If you’re still stuck in traditional outsourcing methods, think again. Project needs are becoming increasingly complex, and competition is stiff. But with the right outsourcing provider, they can take your business operations to the next level.
KDCI Outsourcing is a trusted Philippine BPO company with a solid track record of providing offshore outsourcing solutions to SMEs. Since its founding, KDCI Outsourcing has worked with clients from a broad range of industries, solidifying its experience in tailoring outsourcing solutions to a business’s unique needs and complexities.
Building offshore hybrid outsourcing teams is easy with KDCI Outsourcing. Our recruitment team vets candidates based on their skills, qualifications, work experience, mindsets, and portfolios. As a reputable outsourcing partner, we understand the repercussions of a bad hire, so we make sure our shortlisted candidates are trained in your software and can work seamlessly with your internal team.
Ready to slash operational costs and leverage the skills of Filipino talent? Contact us now, and our outsourcing expert will clue you in on forming your ideal offshore external team.
