Offshoring and outsourcing are often used synonymously because of their similarities. While both work on extended teams in different locations, there are still significant differences between the two methods. Depending on your business goals and the services you need, knowing the differences between outsourcing vs offshoring will help you decide which is more suitable for your business.
Here are some of their key differences
Definition
Offshoring is relocating a business or its processes overseas or outside the country. On the other hand, outsourcing means assigning business operations and other tasks to a third-party provider or a professional specialising in the service. Both processes aim to save cost, but only offshoring transfers a team extension out of the country.
Work Assignments
Outsourcing may utilise services from third-party providers in another country, while offshoring is completed in another country by a dedicated team.
In outsourcing, your business can partner with professionals from external service providers to perform specific work assignments. In offshoring, you can build a team of highly skilled talent and maximise cost-efficient labour in top offshoring locations, such as the Philippines.
Functions
Outsourcing Philippines usually involves hiring a team member who will perform a singular task within a process chain. These tasks are measured based on time, quantity, and quality-based activities.
Offshoring involves more complex functions from an extended team from another country, such as Finance and Accounting Roles, Customer Service, Sales, Digital Marketing, IT Support, or Software Development Roles.
Involvement
In outsourcing, there is little to no interaction in acquiring talent, development plans, and performance management. Outsourced resources are not employees of your business. The external service provider only assigns them to help you.
On the other hand, offshoring allows your company to be fully involved in acquiring talent and integrating your offshore team members. The company directly hires them as an extension of your local team.
This means that your offshore team members are more aligned with your business needs and standards and can work with you to achieve your targets.
Work Quality
With outsourcing, a third-party team is working on specific business processes within your operations. This means that their understanding of your operations is limited to the processes they are handling and not the entirety of your operations.
On the other hand, offshoring allows you to build an extension of your local team. Your offshore resources can seamlessly integrate with your local team, making them more immersed in your business. This means you have more control over the output quality, standards to be followed, and the overall work arrangement of your offshore outsourcing team.
Satellite Office is your expert offshoring Partner
Satellite Office has a proven track record of assisting businesses to leverage the benefits of outsourcing by building a dedicated, highly skilled, and cost-efficient offshore team in the Philippines.
Our tailored offshore outsourcing solutions give businesses full control of their remote team’s productivity, output quality, and targets, while we provide comprehensive support that makes managing offshore employees as simple as possible. Experience a full-service model, including premium facilities, HR, IT infrastructure, account management, and payroll support services, with no hidden fees.
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