Outsourcing, which entails employing remote workers outside of a company’s internal organization, has been used to deploy transitions to a remote and diverse workforce. Numerous companies globally have also developed nearshoring initiatives to build inclusive remote workplaces.
What are outsourcing and nearshoring? What are your advantages and disadvantages? In this blog post, we address these issues.
What is Outsourcing? Pros and cons of Employ Remote Workers
Ionos, a virtual startup guide, explains that outsourcing can be perceived as the “practice of passing individual tasks, subareas, or business processes over to a third-party and thereby receiving the results from outside of your own company.”
Consequently, your company’s services will now be provided by a specialized provider at reduced costs, which will help you deal with inflation payroll increases in the US.
Outsourcing remote employees present various benefits for your company regarding efficiency and saving costs. Moreover, James Bucki describes what the benefits of this hiring practice are. In this Remoto Workforce blog post, we recap these benefits for your information:
Focus on core tasks: if you outsource your remote employees, you’ll be able to focus on your core activities and plan the expansion of your company. A virtual assistant will be of great help in developing the core tasks of your business.
Maintain lower costs: by outsourcing your remote workforce, you can save expenses from purchasing equipment or needing locations. Additionally, you can save costs derived from payrolls and people ops by carefully planning your staffing needs.
Promote growth: Bucki asserts that “Outsourcing can be a good option if expanding to handle those operations yourself is too expensive, would take too long to effect, or would create inefficiencies in your business model.”
On the contrary, Shahira Raineri addresses the cons of outsourcing:
Loss of managerial control and possible quality issues: when you hire remote employees, you will surely deal with the loss of control over their work, which is strongly related to quality. Consequently, we recommend investing in training for your workers and getting technological resources to monitor their tasks.
Hidden costs: hidden costs related to additional fees can emerge when outsourcing remote employees.
Security and confidentiality issues: negotiate with employees to include a non-disclosure agreement (NDA) if you are mainly concerned with intellectual property and confidential data.
In this video, the Productivity Guy explains what outsourcing entails in two minutes.
What is Nearshoring? Pros and cons of Employ Remote Workers
Nearshoring can be understood as a modality of outsourcing that involves hiring employees to delegate tasks in a nearby country. Iris Rangel explains that nearshoring can be more efficient because it allows a company to identify remote employees with similar values and time zones.
According to Rangel, nearshoring reports these interesting pros:
Increase revenue and reduce operational costs: nearshoring allows companies to adjust resource allocation. From Rangel’s perspective, “nearshore provides organizations the ability to manage a high level of control over their production costs by enduring the costs of doing business at a low cost.”
Therefore, small businesses can adequately deal with time lags and variations in local employment practices. You may want to hire a CEO remote assistant to address these issues.
Shared culture and communication: one of the primary advantages of nearshoring is sharing cultural practices and similar communication codes in the workplace. Both businesses and remote employees share equal and common languages, time zones, and holidays, making operations more efficient.
In contrast, nearshoring has a few drawbacks that we want to tell you about in this blog post:
Higher costs: nearshoring remote employees would bring higher costs to your company due to logistics.
In this video from The Audiopedia, you can learn more about nearshoring.