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Offshoring Insights From David Warne – a Co-managed Solution Is the Key to Success

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Offshoring Insights From David Warne – a Co-managed Solution Is the Key to Success

An interview I conducted for my upcoming book was on the topic of Offshoring with David Warne, the founder of Cornerstone Business Solutions. David is an Offshoring expert who founded Sydney Harbour Tall Ships, an iconic Australian tourism and events business. After years of struggle, he transformed this business with an offshore team in the Philippines, which led to him founding a specialist, offshore, solutions for Australian businesses.

If you’d like to access the full interview, you can find it at http://www.engineeryourbusiness.com.au/blog/.

Freedom through outsourcing.

David in this business had the business vision, to create ‘Freedom Through Outsourcing’, which is achieved in three main areas:

  1. A lower cost position, to reduce your costs and use that money to fund projects, ideas or growth.
  2. Deliver remarkable customer experiences.
  3. Marketing – use your team to grow your business, get rid of the things you don’t want to do and create time to do what you’re great at and love to do.

The terms Offshoring and Outsourcing are often used interchangeably. Outsourcing generally means the entire job lot or role is handled by a company who are then responsible for delivering an outcome, whereas Offshoring generally means the client is more in control of their business and processes and is working closely with their offshore team.

A key term to understand in the offshoring world is ‘BPO’, which stands for Business Process Outsourcing provider, i.e. the organisation that provides the service to the client.

A range of work can be offshored, such as inbound calls, social media, marketing, emails, calendars, client communication, paperwork, web design, coding, bookkeeping, data entry and more.

David’s experience shows that base labour costs can typically be reduced by 50% to 80%, along with the significant added bonus of reduced on-costs such as telecommunication, internet, office space, taxes, recruitment, etc.

One challenge that can arise with Offshoring is that of written English. David says that businesses should not expect their Offshore team to write niche content and understand your style quickly – it takes time for a professional content writer to really get your world, your style, your message and be able to do that consistently without errors in language and communication.

With regard to spoken English, David advises that careful staff selection and recruitment is the key to ensure they find people with the best attitude, tone and accent and then work with them to ‘Australianise’ the accent with focussed training.

The key to success is a co-managed solution.

David says the key to success in Offshoring is to have a co-managed solution. Build a long term, dedicated, loyal team. Their secret is in the first 120 days, when they put the Offshore team on an incubator program, covering Australian culture, communication, professionalism and expectations with one-on-one training. David has found this is the first step in taking out the stress and heartache of onboarding and aligning staff members.

In David’s experience, many Australian businesses believe that they need to have good processes documented, or Standard Operating Procedures (SOP’s) in place before going offshore, but he says that’s a waste of time. The approach they use instead is to teach the client and the Offshore staff members to build and document their business processes as they go, then make them better and more efficient, so it takes away key person dependency and provides certainty in what is happening offshore.

Their co-managed model means the resources, training, business processes, desk, computers, internet, video and all the different components for the offshore team member are provided by the BPO, but the client’s business is still responsible for the outcome, the standards and what they want delivered.

David firmly believes that this co-managed solution is the key to success in Offshoring.

Top tips.

David’s top tips for a business considering Offshoring some of their work are as follows:

  1. Look at what might be possible in your business. The competition will be looking at it, and if you don’t move, you’re going to be in a higher cost position than your competitors.
  2. Seriously think and expect great things from your offshore team, and you’ll get what you expect.
  3. Work with a great BPO that has the infrastructure, the people and the Australians on the ground to create a high-performance offshore team.

We live in a big, flat world – make the most of it!

David says he just happens to live in a big, flat world. Asia, America and Europe are all expected to buy Australia’s resources, coal, food and other things, so Australians should return the favour and make the most of what the Philippines has to offer – amazing people. He also believes that Australian business must become globally competitive. Otherwise, someone else is going to come in and do it better and cheaper, so we should make the most of the resources, skills and talent from around the world.

Personally, I haven’t thought before of international people being a resource similar to iron ore – it’s just a question of in what form do you add value? Iron ore adds value to steel, and people add value to businesses. I believe leveraging that is a very powerful tool.

David’s final piece of advice to someone considering offshoring was they should simply get started!

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