Hidden Costs of Offshore Outsourcing
- Time Zones: Having an outsourced team of employees on the other side of the world means shifting all business to do with that team to the early morning or late evenings. It means having as much as a 12-hour gap between consultations with team members, and that equals a huge cut in productivity. If problems arise offshore and the team needs to consult someone in the home office, there is often nothing that can be done for several hours.
- Cultural Gap: Language barriers and cultural divides are real issues. Miscommunications are a constant danger in any business, but they can be especially frequent with team members lacking a common language and cultural context. Additionally, offshore outsourced workers do not always learn a task the same way it is taught domestically, leading to very different ideas of how a project should be completed or when it can be considered finished.
- Travel Costs: Few outsourced teams can work on their own indefinitely with no face-to-face contact with the hiring company. Meetings and visitations to the offshore location are bound to happen, and sending people across the world is expensive and exhausting. It costs money in pure expense, and it costs money in productivity lost by tired employees.
Nearshore outsourcing means:
- Similar time zones. By remaining nearshore, the business hours will be very similar or the same. It is much easier for teams to contact one another and get timely responses when work hours are similar.
- Smaller cultural divide. Most nearshore countries have friendly ties with the U.S. With the prominence of trade and tourism between the two countries, there is more familiarity with each other’s culture and language barriers—while still present—are less common.
- Easy travel. Most U.S. airports have direct flights to the best nearshore locations, such as Costa Rica. Instead of spending most of a day or two on a plane, travel takes only a few hours for face-to-face meetings.