Offshore Staffing is the practice of hiring employees overseas to take up some part of your business operations. Offshoring is a method of outsourcing that has been around for a long time. Its origin dates back to the 1960s, when developed nations offshored manufacturing services to other countries. Lee Kuan Yew, the then Prime Minister of Singapore, who is widely known for his economic legacies, said, “If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.”

offshore staffing benefit

Offshore staffing as an effective business strategy

Today, large companies like Amazon, Apple, Ikea, and American Express depend on offshoring for functions like customer billing, inventory management, supply chain, and more. It can do wonders for your business too. Here are five key benefits of offshore staffing which will compel you to consider implementing the offshore model of staffing as an effective business strategy.

1. Addressing the Talent Shortage

A recent study by Korn Ferry predicts that there will arise a global talent shortage of more than 85 million people by 2030. As a result, economies are estimated to lose about $8.5 trillion annually in unrealized revenues!

The skill gap is evident in the US as the number of jobs exceeds the number of workers available to take them up. This is where offshoring presents a viable solution. By sourcing competent candidates from talent-rich countries, offshore staffing helps you address the talent shortage and optimize your business functions for improved efficiency.

2. Scalable

Offshoring is undoubtedly the most scalable business model. Offshore staffing ensures maximum returns on your investments by helping you save up on many expenses (as mentioned later in this article) while providing the highest work standards.

A global workforce introduces you to new markets and helps you establish yourself as a global brand. Not only that, but it also ensures the continuity of your business functions as each team member alternates between time zones. This helps you stay awake for a client call 24×7, thus increasing your credibility in the market.

3. Highly cost-effective

Providing best-in-class services or top-quality products need not require big bucks. Here’s how offshore business processing offers extensive opportunities for cost-saving at each step.

  • Employee salaries

Offshore employees can be hired at wages much lower than those in the homeland. Countries like India, China, Mexico, and the Philippines, are some of the world’s best offshoring destinations. They offer abundant opportunities for hiring skilled talent at a reasonable remuneration due to the modest cost of living at these places.

According to livingcost.org, the average cost of living in the US is about 79% higher than that in India. So, if you were to hire an IT professional from the US, it would cost you a lot more than that from India for the same work.

  • Cost of Infrastructure

Offshoring helps you significantly reduce the real-estate costs since your offshore employees work remotely, and thus you need not maintain any office space for them. Alongside, you also get to save on the cost of buying and maintaining equipment in the office.

  • Hiring & Training costs

Offshoring usually involves hiring skilled professionals who already have years of experience to their credit. You need not spend anything on their initial training or orientation. They can start contributing to your organization right from day one onwards.

4. It comes with the Assurance of Quality Hiring

Quality hiring is one of the main concerns recruiters have on their minds. But with the offshore model, you need not worry. Offshoring staffing benefits you by helping you access a global pool of professional talent ready to match your work’s quality standards. By bringing on board the hard-to-find skills of your offshore employees, you set yourself up for sure-shot success.

But how and where to find such competent candidates? After all, your search is not limited to specific geography, the entire globe is your potential talent pool! This is where the expertise of an offshore staffing company comes in handy. With access to a vast pool of skilled professionals, offshore staffing services can help you hire smarter, faster, and better.

5. Facilitates Round-the-clock Business Operation

The time zone difference between your offshore and in-house teams offers a major advantage in business continuity. While your team in one country retires to sleep, the one across the border gets up and running for the day’s work. This helps your business operate round the clock and achieve as many as 24 hours of operation.

This not only helps you take up more work but also reduces the turnaround time for existing projects. Additionally, this enables you to be available 24×7 so that you can support your client whenever they call you out.

6. Opportunity for going global

Having a network of employees across borders establishes you as a global brand. You hold the potential to touch the lives of people across diverse geographies. With an excellent opportunity to market your brand internationally, you gain the attention of clients to whom you might have otherwise not been able to connect.

Apart from that, having global employees lets you leverage resources that might be unavailable in your area- be it technology, raw material, or even some services available only locally.

7. Allows your In-house team to focus on Core Competencies

By offshoring some of the mundane tasks like payroll processing, cold calling, data entry, and more, you can free up your in-house team to carry out core tasks. They can then focus their time and attention on tasks central to your business, including marketing strategy, growth strategy, business development, and more.

Offshore staffing benefits you by off-loading your in-house team of repetitive tasks. This helps your team work smartly, thereby improving their work efficiency, thus a win-win for everyone!

Conclusion

Offshoring is one of the must-adopt intelligent strategies for business growth, expansion, and diversification. Having a team of reliable offshore workers can take your business efficiency and profits to another level and help you stay ahead of the competition.



A  2021 report by McKinsey & Company reveals that 87% of the companies worldwide are skeptical of a skill gap within their organization. While 43% of the respondents believe they are already faced with a skill shortage, 22% said they anticipate one in the next two years.

As a result, many companies rely on overseas talent to compensate for the skill gap in their homeland. Two main components of this trend are engaging offshore staff and outsourcing. Let’s take a closer look at them and understand their differences.

What is Offshore Staffing?

Offshore staffing involves hiring employees from different countries and having them carry out all or part of your business functions. 

What is Outsourcing?

Outsourcing is when you deploy a third-party service to complete work for your organization. 

Offshore staffing Vs. Outsourcing- What is the difference?

Although both methods are used for increasing the efficiency of business functions, there lies a fundamental difference between the two. Your offshore team is an integral part of your in-house team, except they work from a different location than yours and are not required to be in the office. In this case your team is still responsible for the deliverables. On the other hand, outsourcing service providers are third parties and own the deliverables, meaning they get the work done on a project-to-project basis.

Consider an example. Let’s say you want to set up an e-commerce store to sell products online, but your company is running short on the required skill set. Now, you have two options: contract the entire project to a third-party firm or hire competent candidates from another at minimal rates. The former strategy is outsourcing, whereas the latter is offshore IT staffing. Offshore staffing agencies help you find and recruit skilled talent from across the globe with minimum hassle. 

Offshore staffing Vs. Outsourcing

Benefits of Offshore Staffing & Outsourcing

Outsourcing and offshoring present excellent opportunities for businesses to improve efficiency and maximize profits, Here’s how:

1. Opportunity for massive cost-saving

Outsourcing- Deloitte says that about 70% of the companies outsource part of their business operations to save on significant expenses. Outsourcing helps companies cut back on costs like employee benefits, training, equipment, and other resources that would’ve otherwise been needed if work was carried out in-house.

Offshoring– Developing countries like India, the Philippines, Mexico, and others are some of the most sought-after locations for offshoring due to the lesser cost of living and favorable government policies. Hiring offshore staff helps companies employ skilled talent at much lower wages than the homeland and leverage tax-related benefits offered by respective governments.  

2. High-quality work & improved efficiency

Outsourcing– Some projects may require specialized skills for their execution. However, it may not always be possible for you to have those skills in-house. This is where outsourcing services come in handy. They are well-equipped with the human resources and latest technology to carry out your work efficiently and deliver high-quality results. 

Offshoring– Some companies consider engaging offshore staff a strategic necessity when filling up skill gaps and maintaining the quality of work. The offshore staff brings a new set of skills to your organization, raising the efficiency and standard of work. 

3. Access to new marketing opportunities

Outsourcing– Outsourcing has always been a powerful tool for globalization. Contracting work to third-party organizations helps you access a vast pool of talent globally. With world-class talent and expertise at your disposal, you can quickly bring in new products and services to compete in the international market.

Offshoring– Almost like a ticket to expanding overseas operations, recruiting offshore staff provides firms access to global markets. Hiring a workforce from different geographies helps companies increase their visibility internationally. Moreover, it allows them to leverage a region’s local resources and research new audiences. 

4. Improved focus on core competencies

Outsourcing– By outsourcing the non-core functions of your business, you can free up your in-house team to focus on more strategic tasks. They will then have the time and resources to invest in brainstorming, scaling up, and carrying out core competencies with full attention.

Offshoring- Similarly, when you employ offshore expert staff for specific business functions, the work gets distributed effectively. Consequently, your in-office team is left with tasks other than those central to your organization’s functioning; hence, they can give their best.

Conclusion

Every organization may be unable to experience the benefits of offshore staffing and outsourcing similarly. As both strategies come with some upsides and some downsides, there is no straight answer to which one is better. Consider weighing all your options before investing your time and money into them. 

Go for the one that best serves your needs and aligns with your business goals. Who knows, a combined approach may be the best where you offshore some part of your operations and outsource others!