The talent and skills shortage in Australia continues to be a major challenge for businesses across different industries. According to a recent Robert Half study, 89% of Australian employers are concerned about finding top-tier talent for their organisation. It’s no wonder that outsourcing has become a popular option in Australia to secure high quality talent. Ibis World reports that there are 36,428 Business Process Outsourcing (BPO) Businesses in Australia in 2024, with a growth rate of 3.2% from 2019-2024.
With so many Australian outsourcing companies, careful considerations must be taken in selecting the right one to help you achieve your business goals. Making an informed decision is critical as mismatched talent from an outsourcing company can lead to costly business disruptions that will hinder your organisation’s growth.
“If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.”
Offshore staffing or offshoring – a form of outsourcing to a different country – provides substantial benefits in terms of cost efficiency, broader access to qualified professionals, and giving companies a competitive edge in the global business landscape. This is not just a trend but a strategic solution to the talent shortage crisis in Australia. A report by Globalization Partners revealed that 86% of Australian business leaders are currently hiring overseas staff to meet the demand for highly skilled talent.
The Philippines is noted for being a top destination for outsourcing, with approximately 1,000 BPOs in the country employing 1.5-1.6 million highly skilled workers. In fact, there are now more than 300 Australian companies that employ around 44,000 offshore talent in the Philippines.
To help you narrow down your choice of outsourcing companies in Australia, here are some important factors to consider.
Experience and Expertise
Assessing the company’s experience in your industry
Knowing how well an outsourcing company in Australia has worked with other organisations within your field will help you to focus on your choice. They must have an extensive background in building remote teams for Australian businesses in the same industry that you’re in. More importantly, these businesses have scaled successfully and achieved growth with the support of offshore staff.
When making your assessment, here are three points to consider:
- 1Review their projects
Make enquiries about the offshore provider’s previous projects that are similar to what you’re planning to do. Get details on the complexity of the project and the outcomes to assess their level of experience. - 2Evaluate the management team
A quick look at the About Us page of the company’s website will show you information about the management team’s experience and qualifications. You can delve further by checking their LinkedIn profiles for their professional expertise. Ensure they have a solid track record in handling projects that match your needs. - 3
Check references
Contact former and current clients of the outsourcing company for feedback on their experience. Look into the scope, quality of services, and any challenges that they’ve encountered and how they were resolved. Ask around for referrals so they can connect you to the company.
Importance of specialised expertise
“Do what you do best and outsource the rest.”
A recent report noted that 97% of Australian business leaders have expressed that globally expanding their operations is imperative in attaining a competitive edge. With various industries experiencing talent and skills shortages, outsourcing companies in Australia provide viable and cost-efficient solutions by assembling an offshore team of specialists to support the business community.
Australian companies can leverage skilled offshore professionals to perform more complex business functions to accelerate the implementation of their speed-to-market initiatives. Having a diverse range of expertise from offshore talent can offer more opportunities for business innovation without the costly burden of maintaining full-time, in-house staff.
With a skilled team of offshore talent, the internal team can devote more time and effort on their core duties to grow the business. This creates a flexible workforce that can operate more efficiently to make the business scale more effectively.
The Philippines, for example, is renowned for its robust talent pipeline that can fill a wide range of roles across different industries, whether for non-core or specialist functions. Unlike their onshore counterparts, their level of expertise won’t put a strain on your operating expenses.
Reputation and Reviews
How to evaluate the company’s reputation
A reputable outsourcing company is essential for a successful partnership. Here are some best practices to help you assess the offshore staff provider.
- 1
Conduct a thorough background check
Do an online search about the outsourcing company and gather the information you need from reliable sources. Make enquiries within your business network about the outsourcing companies you’re interested in. Check for legitimate business licences, certifications, accreditations, and industry awards. - 2
Visit the company’s website and social media
A well-established outsourcing company should have comprehensive details on their website about who they are, what they do, how they work, and what services they offer. You can also see updated information about their financial standing, the number of clients that they have, headcount of employees, and retention rate. Check other resources in the website that will give you a deeper understanding about the company such as case studies, client and employee testimonials, blogs, and even the job vacancies that they offer to build offshore teams for other clients.You can also tell a lot about the outsourcing company from their social media platforms. If they’re active on social media – sharing photos of industry events, company activities, client interactions with their remote teams, positive feedback from both clients and offshore staff – then it’s a good sign that they are transparent, engaged with their clients, and committed to maintaining a strong, positive brand presence.
- 3
Assess their data security
BPOs handle sensitive data so it’s essential that the offshore staff provider has the capacity and capability to implement high-level data security and privacy protection protocols. This gives you the reassurance that they can protect your data from potential cyber-threats. - 4Understand their hiring process and policies
Find out how they manage their recruitment process, including the screening methods they use to select new hires and how they ensure employees meet ethical standards. It’s equally important to know how they maintain accountability, such as through regular performance evaluations and integrity assessments. - 5
Look for reviews
Check online platforms such as Glassdoor, Google Business Profile, Google Reviews, and Facebook for additional feedback about the offshore services provider.
Importance of client testimonials and case studies
Testimonials provide firsthand accounts from previous or current clients describing their experiences with the offshoring company’s services. They play a key role in showcasing the company’s reputation and expertise, offering valuable insights into customer satisfaction. Potential clients often rely on client feedback as a way to gauge whether the company is trustworthy and capable of fulfilling their outsourcing business requirements.
In evaluating outsourcing companies, case studies provide detailed reports that highlight the strategies and outcomes achieved in past client engagements. They offer concrete evidence of the offshore staff provider’s performance, showing how they handle challenges and deliver on client expectations.
Testimonials and case studies that provide the specific pain points of the client make it more relatable, compelling, and trustworthy. This further demonstrates how the outsourcing company has successfully resolved issues that you may also be experiencing.
Service Offerings
For SMEs that want to scale with the help of offshore staffing services in the Philippines, it’s important to be thoughtful about finding a partner that will deliver successful business outcomes. Here are some recommendations on how to assess and select an offshore services provider.
If you’re short on time, you can always get the help of the provider in working through the below.
Ensuring the company offers the services you need
A key factor that can make the outsourcing process successful is managed services. A professional outsourcing company should provide comprehensive end-to-end managed services to support you all throughout the offshoring journey. This includes the following:
- 1HR Consulting
The outsourcing company must have experienced HR advisors who can provide customised strategies and future-proof solutions that cater to your specific requirements. - 2Talent Sourcing and Recruitment
The offshore provider should have diverse and legitimate sources for securing the right talent to match your business needs. They must also be adept in using Applicant Tracking Systems (ATS) that will optimise the recruitment process. The recruitment team must have a stringent screening process that involves interviews, skills evaluation, in-depth background and reference checks. - 3Onboarding Procedure
This should be carefully structured to ensure seamless integration of new hires, minimising downtime and boosting productivity. The outsourcing firm should prepare the recruits on the work processes and expectations of the Australian client, review industry best practices, conduct cultural immersion workshops, and familiarise them with the company culture. IT systems are set up in compliance with data security standards and regulations, with continuous support to avoid any disruptions. - 4Performance Management and Payroll Processing
The offshore staffing services must be in full coordination with you in evaluating your remote staff. They should provide data-driven assessments using advanced analytical tools, highlighting achievements and noting areas of improvement. They should conduct regular check-ins, perform employee evaluations, and create customised development plans to ensure that your offshore staff will stay aligned to your business goals. The outsourcing agency will also facilitate the payroll process, so you can focus on running your business.
Flexibility and scalability of services
Having an offshore team is a valuable asset that can support and enhance your core team’s capabilities. The outsourcing company must be flexible so you can scale your workforce appropriately to meet changing business demands.
By partnering with a trustworthy outsourcing company in Australia, you’ll have the advantage of gaining skilled professionals who can handle a variety of business functions – from back-end tasks to more complex responsibilities. This helps set the stage for further innovation and faster implementation of your time-to-market strategies. More importantly, flexible services from an offshore provider will enable your internal team to devote more attention to business growth initiatives.
Communication and Support
Importance of clear communication channels
One of the top reasons why outsourcing fails is poor communication. It may manifest in different aspects:
Outsourcing success hinges on transparent and proactive communication. Maintaining clear, open channels from the start encourages transparency and allows for quick resolution of any issues that may arise.
Availability of support and responsiveness
A responsive and supportive offshore services provider should provide you with key point persons and their contact details so you can easily communicate with them your concerns or feedback. Here are proven recommendations to ensure better communication between you and the outsourcing agency:
- 1Set up clear communication platforms
Discuss with the outsourcing firm’s representative on the communication channel that works best for both of you. They must also be consistently available when you need to reach out to them. - 2Clarify expectations
Clearly define the scope of work, timelines, and objectives to ensure both parties fully understand the requirements. - 3
Supply comprehensive instructions
Give clear, detailed, and well-documented instructions to avoid misinterpretations. Encourage your offshore team to ask questions if there’s anything that they don’t understand. - 4Maintain regular updates
Both you and the outsourcing company should regularly update each other on any changes or for tracking progress. Transparency is essential for building trust.
Cost and Value
“I believe in outsourcing. In business, I look for economic castles protected by unbreachable moats.”
Balancing cost with the value provided
It’s a well-known fact that outsourcing can yield savings of up to 70%. But the quality of service should never be compromised.
Due diligence is required to do a detailed cost-benefit analysis. This entails a thorough grasp of your business requirements, an awareness of shifting market trends, and a rigorous vetting of outsourcing firms to discover their strengths and weaknesses.
This data-driven approach will help you to manage your expectations and to make unbiased decisions when choosing the right BPO partner within your allotted budget.
Understanding pricing models and hidden costs
These are the common types of pricing models employed by outsourcing companies. Your choice will depend on your budget, the scope of your project, the goals that you want to achieve, and your specific business requirements.
| TYPES OF PRICING MODELS IN OUTSOURCING | |
| Staffing Model | Clients engage a service provider’s resources for a set duration. In the context of BPOs, employees are equipped with necessary workspaces, computers, internet phones, and other operational tools. |
| Fixed Price Model | The service provider offers a standard rate for their services, with payment options available either monthly or annually, that covers the cost for workspace and tools. |
| Cost Reimbursable Model | The service provider caps their consumable expenses and then adds a percentage of those costs as profit. |
| Time and materials (T&M) model | Common in long-term IT projects, this involves outsourcing providers submitting bids and creating proposals tailored to the client’s specific requirements. |
| Consumption-based pricing model | Cloud-service providers typically utilise this model, charging clients according to their actual usage over a month or year. This offers clients flexibility, as they only pay for the resources they consume. |
| Profit-sharing pricing model | Clients can distribute a share of their profits to the service provider as a bonus for high-quality work that leads to successful outcomes. |
| Incentive-based pricing model | Clients can offer a bonus or commission in addition to the standard pricing to boost their service provider’s performance. This is often applied for seasonal accounts or additional services like 24/7 support and after-hours assistance. |
| Shared risk-reward pricing model | This operates on top of the flat rate, with the client and service provider sharing both risks and the potential developments of the project. |
Source: Outsourcing Accelerator
Be aware of these hidden costs. These can impact your financial resources, affecting your decision in choosing your outsourcing partner.
Cultural Fit
Cultural differences can derail offshoring operations if they’re not handled properly. In fact, “cultural differences” and “intercultural communication” are among the top challenges that companies face when working with remote teams from other countries. That’s why it’s important for you and the outsourcing partner to find common ground through proactive discussions.
Outsourcing companies in Australia and around the world recruit Filipino talent for offshore teams because of their cultural compatibility. Here’s why:
Note that when working with Filipino offshore staff, they may seem shy and reserved compared to Western counterparts who are more direct and assertive in expressing opinions. With patience and encouragement, they will gradually build confidence and engage more actively in the team.
Technology and Security
Assessing technology infrastructure
Secure and robust IT infrastructure is a non-negotiable requirement in outsourcing. Constant malfunctions and data breaches can result in costly delays, poor customer service, and a damaged reputation. Here’s how to assess the IT capabilities of an outsourcing agency.
- 1Evaluate hardware and software
Check the company’s hardware, software, and other work-related applications if they’re updated and compatible with your business systems. - 2Check for scalability
The outsourcing company’s tech infrastructure should be scalable to support your business growth. Enquire if their systems can handle increased workloads or expansions without compromising performance. - 3Assess data security measures
Review the offshore staffing services’ cybersecurity protocols, encryption practices, firewall protections, and how they ensure compliance with relevant data protection regulations. - 4Verify backup and disaster recovery plans
Learn how quickly the outsourcing provider can restore data and resume operations in the event of an outage or cyberattack. - 5Review network connectivity
Make sure the offshoring company has stable, high-speed internet connectivity to reduce downtime and maintain consistent communication between your teams. - 6Inspect IT support
Find out if the outsourcing firm provides 24/7 IT support, how they regularly maintain their IT systems, and how they resolve issues to ensure business continuity. - 7Evaluate cloud-related platforms
Check if the outsourcing provider’s cloud-based infrastructure is safe and adequate for your business needs, including their hosting environment, data storage solutions, and cloud security protocols.
Ensuring data security and compliance with regulations
When it comes to offshoring business processes, data security is a major concern. In the past two decades alone, Australia ranked 15th among the world’s most breached nations.
As an Australian employer working with an offshore team, here are ways to ensure that your outsourcing partner maintains their compliance with your company standards, industry regulations, and international laws.
Conclusion
Choosing the best outsourcing partner to match your business needs may seem overwhelming at the beginning. With the right provider to guide you every step of the way, your offshoring journey can be simplified and customised accordingly to maintain quality standards without being a financial burden to your operational expenses.
At Twoconnect, we recruit highly skilled Filipino professionals to be your offshore staff through our comprehensive, end-to-end managed services that includes HR consulting, talent sourcing and recruitment, onboarding, performance management, and payroll facilitation. We employ a proven four-step method in implementing the outsourcing process that is tailored to your specific requirements. We also provide the necessary resources, workplace facilities, and IT infrastructure with top-notch data protection protocols that will enable your offshore team to work productively whilst maintaining effective data security.
We support the Australian business community in providing a flexible workforce that can adapt to your work culture and your scaling needs, ensuring seamless integration as your business grows. Here are some of our success stories:
Remote team: Sales Support Officer
Outcomes: 20% increase in social media subscriptions and 40% increase in sales
“It’s been a tight labour market coming out of Covid, as we struggled to retain our admin staff. Twoconnect found someone for the admin role – we were surprised at how good she’s been and it’s worked out really well. I couldn’t recommend Twoconnect enough. They made it seamless.”
Brent Vaughan, Director
Outcomes: Supporting desk exceeding targets in ticket responsiveness and resolution
“I previously owned a recruitment company – I understand the time invested in recruitment. Twoconnect takes away all the heavy lifting. A process that would normally take me 30 hours is taking me 2 hours to find the right person. And the quality of staff that we are getting is higher than what we can get in the Australian market. It’s been an incredible team to build and it’s been very helpful with our cultures being aligned. Anyone thinking of starting their journey with outsourcing, Twoconnect is the company to go with.”
Alisha King, COO
Outcomes: 150% revenue growth over a 2-year period
“We tried other avenues of offshore employment, directly engaging with individuals. The issues we had was accountability. Working with Twoconnect has taken that issue out of the way. The passion and expertise of the Twoconnect management team have been absolutely vital in the success of growing and maintaining our offshore team.”
Jerry Kennard, CEO
