Startup Outsourcing: 4 Signs You Should Be Considering It

by admin | Jun 12, 2024 | Pages

Startup Outsourcing: 4 Signs You Should Be Considering It

If you’ve ever built a startup—or any business, for that matter—you know that resources are always limited, there’s never enough time, and you have to do the job of multiple people by yourself. Every entrepreneur and startup founder knows that the road won’t be easy, but the obstacles can still surprise you and throw you off-course. Obstacles can spoil your plans because they weren’t anticipated, you don’t have the resources to address them, or you’re unsure of your next steps.

Money will always be a concern, especially at the onset. It’s a delicate balance: pinch your pennies and your business might not grow at the rate you expected, but spend too much and it might not grow at all. Ironically, trying to cut costs aggressively when you’ve barely launched your startup can do more harm than good. Instead, focus on the aspects of the business that will help sustain it and push it forward, like marketing, which is an oft-neglected part of the startup planning stages.

Manpower is also something that should be considered during the early days of your startup. The nature of startups require specific skills and talent, and getting the right people can mean the difference between an up-and-coming player and a startup that would have made it. Staffing requirements should be considered while you’re just starting because, as your startup grows, any talent gaps and staffing issues are also magnified.

“I Can Do It” vs. “I Can Do It All”

A startup is a very dynamic organization by nature, and this can affect the roles that people play in the organization. Specifically, roles will overlap and you may find that you and your staff may be doing more than what’s in the job description.

As a founder, you may be tempted to do everything yourself, but this isn’t a sustainable solution. If you do the job of several people by yourself, you won’t be able to give 100% to any single task and you’ll be decreasing your productivity by as much as 40%.

Hiring the right people will prove to be a smart investment despite the process taking up a lot of time and effort, especially for small teams. Realizing that you made rushed decisions during the recruitment process can prove to be major hurdles down the line, as staffing issues are magnified as your team grows.

Startup Outsourcing: When to Consider It

Startup outsourcing is a solution that helps new businesses bridge talent gaps while also keeping costs at a minimum. If you’re wondering if outsourcing can help optimize business processes or fill talent gaps within your startup, it may be time to start looking for a startup outsourcing company. Below are a few signs that may indicate your need for one.

You Have Very Specific Skill Requirements

Versatility is key in hiring for your startup, but this doesn’t mean that you’re hiring a single person to do everything for you. Some businesses or processes require expertise or extensive experience in a certain field. Unless your startup specializes in a certain field, it’s best left to the professionals.

Startup outsourcing will help you with your staffing requirements by expanding the talent pool from which to get the people you need. Whether you’re looking for a finance expert, a web programmer, or a digital marketing professional, Outsourcing ensures that you get the right talent that fits your specific needs. Broadening your search also helps cut down costs and provides more options.

You Need a Cost-efficient Solution

For many startups, outsourcing is a solution that helps significantly reduce overhead costs. Aside from staffing, you get access to an outsourcing company’s resources and services. This is comparatively less expensive than hiring a full-time employee in-house. It’s also easier to hire people for freelance or project-based tasks if you have seasonal staff requirements. Outsourcing companies also offer back-office services like payroll, accounting, and office management, to name a few.

You Need More Time

If 24 hours in a day doesn’t feel enough to meet your deadlines and you feel like a candle burning at both ends, it’s time you asked for help. Startup outsourcing companies can provide the help you need by helping you hire people—plus onboard, train, and manage them if need be. As a founder, you should set the direction of your startup, but it doesn’t mean you have to steer by yourself.

You’re Looking for New Ideas

Startup teams start with good ideas, but you can’t expect them to have new, innovative ideas all the time. Often, even weekly brainstorming sessions don’t help, and only a fresh set of eyes can help you and your team get a new perspective. Viewing the business from the outside looking in can provide valuable insights that you may not have considered. Ideas from someone who is able to distance himself or herself from the business can help you identify areas for improvement and processes or strategies that you can double down on.

Key Functions to Outsource

While any part of a business can be outsourced, certain functions are particularly beneficial for startups to delegate:

IT support and software development: Leveraging the expertise of tech professionals can ensure your digital tools run smoothly. These experts bring fresh ideas and ensure you’re using the latest technology, providing both innovative solutions and cost savings by avoiding the need to assemble an in-house team.
Customer service and administrative tasks: By outsourcing these areas, startups can ensure that customer queries and paperwork are handled professionally and efficiently. This allows startups to provide round-the-clock support, enhancing customer satisfaction and loyalty across different time zones.

How to Achieve Startup Outsourcing Success

Startups looking to outsource effectively need a robust strategy. Here’s how to ensure your outsourcing venture thrives:

Define your objectives clearly. Think of your outsourcing goal as setting your GPS. This clarity will not only guide but also empower your decision-making process, ensuring alignment with broader business goals.
Maintain open communication. Regular and transparent dialogue is essential. It minimizes misunderstandings and helps keep projects on the intended trajectory, much like a steady navigation system.
Establish clear expectations. Articulate your needs and timelines early on. Defined expectations act as a roadmap, helping to avoid potential pitfalls and conflicts down the line.
Embrace diversity. Welcoming diverse perspectives can be a catalyst for innovation, offering fresh ideas and enhancing creativity within your projects.
Prioritize quality over cost. While budget constraints are real, compromising on quality can be detrimental. Quality work should always mirror your startup’s core values and standards.
Foster a collaborative environment. Treat your outsourcing partner as an extension of your team. Strong relationships can yield exceptional results, turning collaborative efforts into mutually beneficial outcomes.
Select the right partner. Opt for partners who align with your startup’s ethos and ambitions. A shared vision can be pivotal in nurturing a strong and sustainable partnership.

By implementing these strategies, startups can navigate the intricate outsourcing landscape seamlessly, transforming collaborative efforts into fruitful successes.

The Future of Startups is Outsourcing

Startup founders should look beyond the negative connotations about outsourcing and focus on strategies that will make their business thrive. There are advantages and disadvantages to startup outsourcing, but with proper planning and delegation, it will more than pay for itself in the long run. Diversifying your organization ensures that you have the necessary competencies and a healthy mix of perspectives that can help take your business to the next level.

Schedule a call with us today to see how startup outsourcing can optimize your business for easy scaling and healthy growth. Focus on the more important things like strategy and business direction and leave the dirty work to us.

Startup Hiring in the New Normal

by admin | Jun 12, 2024 | Pages

Startup Hiring in the New Normal

As a startup founder, there’s nothing wrong with looking ahead and making projections about your business and what it may need down the line. There will always be a roadmapping and planning stage that can take a couple of days to a few weeks, depending on project or business size. This is also the time when you figure out the right kind of talent you need to run your startup and start building relationships with potential candidates.

Now, more than ever, every company should be more careful and intentional about how they hire. The landscape is very different, and can be quite challenging if you don’t rethink your approach. Hiring more people doesn’t necessarily result in a more robust organization, especially if you don’t hire people with skills complementary to your business.

4 Tips for Startup Hiring

Projections made in the early stages of a startup are rarely accurate, and the same goes for startup hiring. Rather than hiring based on expectations, you should hire in response to demand. This isn’t to say that you shouldn’t be building a pool of candidates, but you should be careful when it comes to actually appointing someone for a specific role.

Below are a few ways you can improve your startup hiring process to ensure that you assign the right person to the right job.

Leverage Digital Tools

The talent market has changed drastically due to the pandemic. With most people in a remote or hybrid working arrangement, startup hiring has taken the same direction. Interviews are now done online, and although video conferencing tools help in putting a face to a resumé, it’s still a limiting interaction compared to an in-person interview.

Embracing digital means going where the candidates are: reaching them through their preferred media, talking in their language, and making an impression online. Using social media is a two-prong approach: you can use public social media profiles to get an idea about the candidates you’re looking to hire and you can use it to create a public company profile to help you put your best foot forward.

There are also software available today that can help you with screening and selecting candidates. Ultimately, the decision should be made with the help of these digital tools, but you should be careful of unconscious bias and use your better judgment when it comes to hiring candidates for your startup.

Build a Strong Brand and Online Presence

Building a brand is now mostly done online, and it’s vital because a strong brand lessens the need for active recruiting. Research shows that over 75% of professionals are passive candidates, widening your candidate pool and opening up opportunities to talk to those who are already hired but looking for greener pastures.

A strong brand and online presence puts you in front of these candidates and increases the chances of them and other actively applying candidates to interact with you and consider applying for your open roles.

Continuously improving brand reputation also has its long-term benefits, as it reduces employee turnover by as much as 28%.

Craft Conversational Job Descriptions

Job descriptions shouldn’t just be a rundown of responsibilities and requirements, it should be a description of the overall employee experience while working for your startup. It should communicate directly with your target audience and show them how working in your company can contribute to their career and personal growth.

Presenting a list of responsibilities without proper context will alienate candidates and discourage them from pursuing their application. You already know what you want your hires to do; show them through your job descriptions what your company can do for them if they become employees.

Be Your Own Salesperson

If you don’t believe in your own product, no one else will. In this case, your product is your startup; as a founder, you should be your own biggest fan. Potential candidates do their own research before applying for a job. They will only pursue an application if they like what they see about your startup.

Being the most active salesperson in your organization sets the tone for the rest of the employees and ingrains in them the organization’s and your brand’s best and most notable features.

Aside from the information from your website, candidates will look at social media, review sites, and information from current and past employees. If you have some negative reviews online, see if these issues can be addressed and take a look at how to further improve your company culture. Happy employees result in positive reviews and will help you land the right talent for the open positions in your organization.

The Start of a Startup

In the early stages, startup founders will find themselves performing a number of important tasks that will vary from strategizing to negotiating with potential partners or hires. In between all these, they should also be constantly “selling” the startup to customers. Active selling can help develop resilience in the face of challenges and objections, and will help you identify what works and what need to be improved.

Ultimately, Your growing startup will need the dedication of a capable team. It can be a challenge to hire people based on early projections, but hiring in response to demand will ensure that you bridge talent gaps and hire the best people for the job.

Talk to us today and find out how you can get the best talent in the Philippines and why you should consider offshoring your workforce during the startup hiring process.

nXscale Turns One

by admin | Jun 12, 2024 | Pages

Offshoring Challenges and How to Prepare for Them

by admin | May 31, 2021 | Pages

How to Prepare for

Offshoring Challenges

In a pandemic-driven business landscape, doing business can be challenging if organizations don’t find a way to adapt to the current situation. The business landscape has changed through the years, but with the current state of affairs, it has been in a constant state of flux. Businesses have found it necessary to be innovative and find ways to circumvent obstacles—both old and novel. While offshoring or business process outsourcing isn’t a new approach by any means, it has become a go-to solution, especially now, as businesses navigate the challenging landscape brought about by COVID-19. It helps reduce labor costs, which is arguably one of the largest expenses of a growing business. Offshoring also expands your talent pool and provides greater availability by tapping regions in different time zones. The IT industry is one of offshoring’s biggest markets, and the estimated value of the global IT outsourcing market by the year 2026 is $425.19 billion, a 4.5% growth (CAGR) from $318.5 billion in 2020.

While offshoring helps maximize a company’s resources, the process can be a challenging one, especially because you need to build a strong relationship with a supplier or third party. Before transferring business processes and knowledge to another organization, you must ensure that expectations are aligned and that communication lines remain open in case any issues arise.

The Common Pitfalls of Offshoring

Today, even small businesses outsource at least one of their business processes to increase overall efficiency. Startups have also resorted to offshoring or outsourcing business processes in an effort to cut costs and fast-track growth. However, it’s not as simple as hiring freelancers or contracting with a third party. There are several things to consider first before taking the offshoring path. Below are the common challenges of offshoring.

Not Choosing the Appropriate Location and Supplier

Before signing a contract with an offshore service provider, first consider the location. There are several other aspects tied to a physical location, including skill availability, attrition rates, legal issues, geopolitical issues, and currency fluctuation, among others. Culture compatibility should also be considered; this should be attained at a corporate, process, and day-to-day interaction level. To bridge cultural barriers effectively, organizations can implement several strategic solutions:

Cultural training programs: Equip teams with cultural training to understand and appreciate different communication styles. This can pave the way for smoother interactions and mutual respect.
Consistent communication: Establish clear and consistent communication protocols. This helps in building a strong working relationship and ensures that everyone is on the same page.
Open lines of communication: Create open channels for dialogue by planning regular video conferencing meetings. These meetings foster familiarity and help team members become accustomed to each other’s language nuances and communication patterns.
Regular interaction: Encourage frequent interactions. Over time, this will lead to a deeper understanding of each other’s cultural contexts, enabling teams to read between the lines and collaborate more effectively.

By integrating these practices, companies can enhance cultural compatibility and foster a more harmonious and productive working environment across borders.

Loss of Control Over Processes and Knowledge Transfer

This should be discussed and agreed upon at the onset; there will be a perceived loss of control over processes as some of them are handed over to the service provider. This and the consequent transfer of knowledge can present internal challenges that are better addressed before contracts are signed and agreements are finalized.

Not Considering Cost Overruns

The reason why most offshoring ventures fail is because they fail to assess and realize the overall total cost of the process. It’s a mistake to focus solely on the wage cost arbitrage when taking your business processes to an outsourcing company. Consider all costs and expenses—both direct and indirect—to avoid perceived cost overruns.

Underestimating the Transition

The most challenging period when offshoring is the initial transition process, especially when offshoring for the first time or with a new outsourcing company. As with any new venture or transformation effort, this process should be rigorously planned, flawlessly structured, and should have the full commitment of senior management. This would help in the procurement of the resources necessary to make the initiative successful.

Non-existent Data Security Protocols

Business process outsourcing and knowledge transfer entails providing access to certain critical data to a third party. There should be strict data protocols that your chosen provider adheres to unconditionally. This is vital because a data security breach can lead to more serious problems that could affect both your business and your customers.

Mismatched Expectations

Expectations should be aligned even before considering a partnership with an outsourcing company. The misconception most companies have is that they are offshoring roles or personnel, which isn’t the case. In an outsourcing venture, they are offshoring processes, services, and activities.

Mismanaged Communications

Communication is an oft overlooked but vital aspect of offshoring, and mismanaging it can lead to catastrophic consequences. Every aspect of communication should be managed to the littlest detail; the timing and level of communication is very important. Providing information too early raises apprehension; providing it too late could run the risk of misinformation. You should also ensure that you are talking to the right person regarding certain aspects of the offshoring venture to save time and make communications more efficient.

Effective communication and expectation management with offshore teams can make or break a project’s success. To achieve this, businesses need to adopt good practices, including the following:

Document everything
Always ensure that every piece of communication, especially instructions, is documented. When you put all directives in writing, it prevents the loss of crucial details during translation. It also provides your offshore team with a reliable reference while working on the project.
Encourage confirmation
During meetings, particularly virtual ones, don’t just rely on non-verbal cues like nodding. Ask your offshore team leader to repeat the instructions in their own words. This practice can unveil misunderstandings early, allowing you to clarify and ensure everyone is aligned with the project’s requirements.
Schedule regular alignment meetings
Frequent meetings are essential to keep both onshore and offshore teams synchronized. These sessions not only foster stronger relationships but also help verify that both teams share the same objectives. Regular check-ins can prevent misaligned goals and help track progress effectively.

By adopting these strategies, businesses can build a robust framework for clear and effective communication, reducing the risk of mishaps due to mismanaged expectations with offshore teams.

Avoiding Pitfalls and Addressing Offshoring Challenges

Who does what from where is not as important as how it’s done and how the outcomes are measured. As such, there needs to be a clear and specific process that can be followed by both the client and provider before the offshoring process begins. The specific processes may vary depending on the organization, but they can be summarized into the following:

Prepare meticulously.

Offshoring requires that an organization have clear financial targets and defined outcomes so that priorities can be set. These priorities should then be validated constantly throughout the entire offshoring process. The reasons for offshoring and leveraging global delivery should also be clear to everyone in the organization, especially senior management. Below are a few key activities that should be done before proceeding with an offshoring arrangement:

Secure buy-in and support from senior management.
Craft a clearly defined strategy that specifies objectives.
Define areas and processes that set the scope of the offshoring arrangement, specifically core (business-critical) and non-core (non-business critical) processes.
Establish KPI’s for both the transition and steady phase.

Overcoming common offshoring challenges can yield significant benefits. By preparing meticulously, you create a foundation for a strong team culture, ensuring everyone is aligned with the company’s objectives. This alignment fosters open communication channels, which are crucial for maintaining productivity across borders.

Get to know your service provider.

Talking with your provider over the phone or via a video call isn’t enough; you should visit the provider’s offices and get a feel for their processes and see how they work. Seeing the process firsthand will allow you to audit the provider and make some tweaks into certain parameters like HR processes, working standards, and compliance with local regulations. In return, you should also allow your provider to get to know your organization. During the planning stages, providing them pertinent data about your processes, tools, and applications will help them during the transition phase.

Building a relationship with your service provider not only helps in ensuring compliance and quality standards but also strengthens collaboration. This relationship is key to overcoming initial challenges and achieving a highly engaged workforce that feels connected to your organization’s mission.

Manage the transition process.

Startups shouldn’t underestimate the transition process when engaging with a third-party provider. It’s advisable to have a dedicated program management office or platform that both parties can use in fulfilling requirements and dealing with issues and challenges along the way. Both parties should be represented in said platform to ensure effective reporting and solutions that are in the interest of both the organization or client and the service provider. Managing an offshore team can also present unique scheduling challenges, but with the right strategies, these can be effectively navigated.

Anticipate Key Dates and Holidays: Understanding important dates and holidays in your offshore team’s region is crucial. By familiarizing yourself with their calendar, you can plan activities and deadlines in advance, minimizing unexpected delays. It’s essential to consider both official and informal holidays. Engaging with your offshore counterparts about their local traditions and typical holiday activities can help you gauge their availability, setting realistic expectations.
Implement a Robust Scheduling Process: A structured scheduling approach is vital for seamless operations. This involves strategically planning meetings and project phases within flexible timelines. Establish clear communication about how much preparation time your offshore team needs for meetings and important tasks. By marking these dates on a shared calendar, both onshore and offshore teams can stay synchronized and avoid last-minute scrambles.
Optimize Overlapping Work Hours: Identifying overlapping work hours between the onshore and offshore teams is key to efficient collaboration. For instance, if your local team operates from 9:00 AM to 5:00 PM and the offshore team from 3:00 PM to 10:00 PM, utilize this common timeframe for crucial discussions and collaborative tasks. This overlap ensures real-time communication and faster problem-solving, enhancing productivity.

By employing these strategies, companies can effectively address scheduling issues, creating a more cohesive and responsive offshore collaboration environment.

Ensure smooth operations after the transition.

Even as the offshoring venture moves into “operational mode,” you should still make an effort to ensure that established processes run smoothly and without a hitch. Learn from your experiences during the transition period and ensure that everything is clear-cut when it comes to incident management and change requests. You should also consider reducing worker turnover in offshore teams, which requires strategic and thoughtful human resource practices. Here are some effective ways businesses can tackle this issue:

Develop strong team dynamics: Foster a sense of belonging and cohesion within teams. Implement team-building activities and encourage collaboration across all levels to create a unified work environment.
Implement an attractive incentive system: Offer competitive salaries and diverse incentive packages that include benefits such as performance bonuses, health insurance, and career advancement opportunities. Recognize and reward outstanding performance to motivate employees to stay.
Enhance communication: Establish clear and open lines of communication. Use real-time chat and private messaging tools to ensure consistent connectivity between team members and management, enabling a smoother workflow and quick resolution of issues.
Provide career development opportunities: Encourage continuous learning by offering training programs and professional development courses. There are several online webinar and educational platforms that can provide the necessary skills to keep employees engaged and invested in their roles.
Ensure cultural sensitivity and inclusion: Respect and embrace cultural diversity by organizing cultural sensitivity training. Foster an inclusive environment where all employees feel valued regardless of their background or geographic location.
Regularly gather and act on feedback: Conduct regular surveys and feedback sessions to understand employee concerns and address them promptly. Utilizing online survey platforms can help streamline this process. Employees who feel heard are more likely to remain committed to their organization.

Focusing on these areas can effectively reduce turnover in your offshore teams, resulting in a more stable and productive workforce.

Successfully managing offshoring aspects will lead to a workforce that is not only efficient but also highly productive, driving the success of your offshoring initiative. As with any change, there will be an adjustment period as you try to find the balance between doing things in-house and offshore. Having the right partner will help make the transition smoother, simpler, and quicker.

Explore how nXscale can help you build your team and scale your business while avoiding the pitfalls listed above.

Next Entries »