Offshoring has existed for decades and will continue as more skilled manpower is required and the cost of skilled labor and doing business in some countries increases tremendously.
However, offshoring doesn’t ‘just work‘ as some companies think when they venture into this model. All they see is the difference in dollars and think of it as merely shifting work from one location to another. However, there are several complications involved in offshoring, and many companies have failed in this endeavor even after trying multiple times.
Taking projects offshore, finding the right partner, right location, competitive rates, strong team selection, and setting up a working model all of it take a lot of planning and effort. There are dedicated companies that help out in many of these tasks but still, there’s a lot that needs to be done by the company that wants to venture into offshoring.
Even if a company chooses the right location, real estate, amenities, partners, and team, still things can be very shaky until you have a good working model between the onsite and offshore teams. A lot of time and productivity can be lost if both the teams can’t work in tandem and often if this situation continues, companies lose revenue and reputation and start to question their decision to offshore.
For any offshore model to work there are 3C’s that are key to making it successful:
1. Communication
When offshoring in a country where the first language of communication is not the same, then communication becomes the key to the whole venture. Companies need to ensure that the teams on both sides can communicate easily and understand each other well. There could be cultural differences, accents, and behavioral differences that should be understood and worked on. If a company is offshoring then it’s important to understand its offshore team well, doesn’t matter if it’s an extended branch of the company or set up with a partner company. All the things like communication model, language, behaviors, cultural nuances, festivals, topics to ignore, etc. should be ironed out at the beginning of the engagement. The so-called ‘cultural training’ has to be on both sides of the ocean. This is often overlooked by companies and it takes a long time to get for teams to simply communicate in a way that the other one understands. A ‘yes‘ could mean (and does mean) different things for onsite and offshore teams.
2. Collaboration
Collaboration is well talked about and a well-loved word for all leadership speeches. Everyone can collaborate when they are colocated but when it comes to offshoring, the level of collaboration goes down drastically. In many companies, offshoring simply becomes work delegation.
This is not a model that will work (or at least work initially) unless there’s the right team working and working together for a long time. It’s the same as a colocated colleague or team member who can only be delegated or left to work on his own after some time has passed, the initial hand-holding has been done and the confidence level in his work has grown over a period of time. The collaboration has to be executed in different stages and good collaboration tools should be used. A sense of a single team has to be created across the timezones rather than a clinical division of work.
Investment in good collaboration and communication tools is well worth it. Choose the ones that both teams are accustomed to already or the ones that most team members are already using (and train the others on that).
3. Care
Now some might frown upon this one. Why should we Care? We are hiring a third-party vendor to deliver the work and their company should care for their employees. Companies doing offshoring don’t usually want to invest in HR, Admin, and Operational costs or at least save on it. But Care goes much deeper than those cost savings.
It’s often the case that when someone is in front of us we tend to understand their pain, and hardships better and can sympathize with them and support them. With offshoring, it’s usually ‘out of sight out of mind’. Rarely do companies think of offshore teams as ‘their’ teams. Offshore teams are mostly treated as different teams. The same standards don’t apply to offshore teams as they do to their counterparts. Information sharing, training, work hours, quality of work, empowerment, celebrations, etc. are rarely equal. Although leaders will call the offshore teams their ‘extended teams’ or their ‘partners’ in their speeches, seldom it shows in their actions. The thing to remember is that you are interacting with humans. The care you show will be reciprocated in kind.
Offshoring is far more than a cost-saving tactic—it’s a strategic initiative that requires thoughtful execution. Companies must approach it as a long-term partnership that involves significant investment in relationships, tools, and processes. By focusing on the 3Cs—Communication, Collaboration, and Care—businesses can unlock the full potential of offshoring, driving both efficiency and innovation.
In the end, the success of an offshore model hinges on building the right teams and fostering an environment where they can thrive. With proper planning, consistent effort, and a people-first approach, offshoring can become a powerful lever for organizational growth.