Productivity is a measure of output relative to input. When two companies use the same resources, the one that produces more is considered more productive. A study published in the Strategic Management Journal in 2016 found that outsourcing can lead to increased productivity if the offshore country has a similar level of development and similar business practices. Outsourcing can also be more productive than hiring in-house if offshore workers are more productive than local workers.

Most companies outsource because they save a significant amount of money on labor, overhead, and related costs. Other benefits of outsourcing are improved quality and productivity. You get better quality when you partner with a company with extensive experience in a particular area. You also gain access to the latest technology and efficient processes offered by outside experts.

But how does outsourcing increase company productivity? When you outsource to a competent and skilled professional or third party, it’s like cloning your in-house team. You double your resources for way less than if you hire full-time workers, and you free up time to focus on what you do best. This is even more so if you outsource to an overseas provider.

Why You Shouldn’t Do Everything

Some entrepreneurs and small business owners feel a loss of control when they are not managing every aspect of their business. But if you are spending precious time trying to perform every single task, you risk being underproductive. Remember that productivity is doing more with less, not simply “doing more.”

For example, if your hourly rate as an app developer is $90 per hour, and you spend five hours a week on paperwork and payroll, you are an overpaid clerical worker. If you outsource these necessary but grueling tasks to someone who charges $60 for accounting tasks, you save $120 a month. Besides the savings, you can increase profit by making new apps instead of working on non-revenue-generating activities. And because of the lower rates, you can hire a larger number of people, thus multiplying productivity even further.

Outsourcing is much more than a cost-cutting tool; it is also a strategic tool. By outsourcing certain activities, you minimize risk. For instance, when problems arise, the third-party provider shares accountability with you. In addition, you don’t need to invest in expensive equipment, infrastructure, technology, office space, and maintenance. The provider takes care of these.

If you’re stressed out from trying to juggle multiple things at once, and it’s taking a toll on your productivity, consider outsourcing. To find out if outsourcing is right for your company, identify your strengths and weaknesses, and tasks that you don’t enjoy doing. The key is to determine whether a non-core task could be performed by a third party at a lower rate, more quickly and efficiently.

Offshoring and Improving Productivity in Key Areas

Can’t decide which tasks to outsource?

Ask yourself why you went into business in the first place. Think about your company’s mission. Then list activities that you need to do but don’t generate revenue. This can be answering emails, website design, updating social media, making presentations and reports, HR, payroll, IT support, and maintenance. You can outsource the tedious tasks you dislike doing and that take time from your core competencies. When you and your staff enjoy the work and are fully immersed in it, you become more productive.

Here are some key tasks that can be outsourced to improve productivity:

Payroll

Payroll is one of the most obvious tasks to outsource. It is far too labor-intensive and grueling and requires specialized skills. Even if you enjoy tracking attendance and doing taxes, your time could be better spent on growing your company. Outsourcing payroll could also improve employment regulation compliance and minimize HR issues.

Human Resources

Like payroll, HR is not something most companies can claim as a core competency. To save costs, consider partnering with a specialized HR and recruitment firm rather than establishing an in-house HR team. Outsourcing HR processes increases productivity by speeding up the recruitment process. The sooner you fill an open position, the more productive your company will be.

Information Technology

Information technology services range from infrastructure to management and support. Instead of overseeing IT processes, partner with an experienced IT provider to keep your in-house staff focused on the essentials. Outsourcing IT also boosts productivity and efficiency by giving you access to the latest software, hardware, and processes without worrying about upgrades and maintenance.

Healthcare

Outsourcing medical billing and coding can help improve accuracy, speed up the billing process, and reduce administrative costs. Another healthcare-related function often outsourced in the healthcare business is patient management. This includes appointment scheduling, follow-up calls, and patient records management, which can help free up staff time and therefore improve the patient experience.

Design and Creative Services

You could probably learn to design your company logo, letterhead, promo materials, and website. However, you would probably have to invest a significant amount of time, and the final look may not be as polished as a professional’s work. Outsourcing web developers or graphic designers can save you both time and money.

Social Media

We all enjoy connecting with our customers or fans via social media channels like Facebook, Instagram and Twitter. But updating and targeting content and converting followers into customers can be time-consuming. By outsourcing social media management, content creation, and related tasks you can focus on what you do best.

Increase Productivity by Outsourcing to the Philippines

Few locations in the world have the right mix of cultural compatibility with the West, a growing labor force that communicates in English excellently, and the lowest prices in the industry than the Philippines. It is second only to India as a global outsourcing hub, and both small businesses and large corporations have established operations in the country to improve productivity and cut costs.

In addition, BPO companies from the Philippines make it easy for clients to get started with minimal risk. You have unlimited flexibility when it comes to pricing, the number of people you want to hire, and the kind of services you want to outsource. Partner with a company that offers custom solutions to make sure you are meeting your objectives.

To learn more about outsourcing, you can read our Top 8 Qualities of an Outsourcing Company in the Philippines article. We invite you to follow us on social media and to visit our website to learn more about our services.

About Us: Sourcefit is a widely recognized US-managed business process outsourcing company based in Manila, Philippines. We proudly serve over 100 clients with a workforce of more than 1,300 employees. Our global centers can serve multiple markets, and our staff is highly proficient in English, Spanish, French, and Portuguese. Whether you need a few or many employees, we can help you achieve your business goals and build high-quality offshore teams.

Latest Awards

Sourcefit’s commitment to excellence has been recognized through numerous industry awards and certifications.

We recently received the Fortress Cyber Security Award from the Business Intelligence Group. Sourcefit was also honored with the prestigious recognition of Best Outsourcing Solutions Provider in the Philippines during the 2023 Business Excellence Awards.

Other awards include: FT ranking of 500 high-growth Asia-Pacific, The Marketing Excellence Awards, Inquirer Growth Champion,  HR Asia Awards, among others.

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