A comparison
As it concerns offshoring, both India and the Philippines are viewed as key contenders that have their peculiarities and advantages. To guide your selection for your company, it is necessary to discuss and analyse the factors that provide insight into the features of offshoring in these countries and to compare their merits concerning talent pool, cost efficiency, language barriers, culture compatibility, and specialisms.
As per Deloitte global outsourcing survey, “The recent findings from Deloitte’s 2023 Global Shared Services and Outsourcing survey revealed that India, followed by Poland and Mexico, emerged as the most preferred location as a Global Shared Services hub. The report delved into the evolving service delivery models adopted by the world's largest companies amidst tightening economic conditions and continued preference for remote and hybrid work.”
Let us understand and analyse outsourcing Philippines vs India.
Considerations to keep in mind when offshoring
When offshoring a business, one must understand certain factors and parameters to make it work. Here are some key things to keep in mind:
1. Cost vs. quality: Though offshoring is all about cutting down expenses, there is a need to find a middle line between expense cutting and quality deliverance. Thus, it is observed that cheap labour may reduce costs, but it also leads to indifference resulting in a lowering of the value chain.
2. Cultural differences: This includes culture shock as well as learning and observing the culture of the offshore location. The communication may also vary together with the working ethic and business practices thus need to work out issues arising from these cultural gaps.
3. Legal and regulatory compliance: Compliance with the laws of the home country as well as those of the offshore country must strictly be adhered to. This entails the areas of employment, data protection, and tax rules affecting business operations.
4. Risk management: It includes geopolitical risks, risks pertaining to the protection of intellectual property, and issues of security of data and related information.
5. Communication and collaboration: Ensure that there are well-defined communication channels and established collaboration expectations between different teams especially where the teams are in different time zones.
Overcome the geographical barriers and maintain proper coordination with the help of available technologies and instruments.
6. EoR selection: Screen the offshore vendors properly to assess whether the vendor possesses the capacity, resources, and experience to meet your requirements. Consider factors like reputation, expertise, scalability, and financial stability.
7. Intellectual property protection: Ensure that any information that is considered to have proprietary value, a patent, trade secret, etc. is safeguarded when disclosed to partners overseas. This can entail contractual provisions, secure code processes, and limited user permission crusades.
8. Logistics and infrastructure: How will you assess the transport and communication cost of goods and services that are offshored and power necessities of a nation? Some of the recommendations made are that there should be reliable connectivity and support systems that are available to the patients.
9. Employee morale and retention: Offshoring has relative effects on morale and job security of employees of the country of origin. Address your workforce regarding their concern and assure them by offering support and training to lessen their worry.
10. Long-term strategy: Offshoring should be guided by your strategic plan as well as your company’s objectives and missions. Offshoring should be transformed from an experimental activity into a managed process by maintaining an ongoing perspective of the beneficial results of offshoring projects and being ready to make changes to the strategies and plans.
Offshoring to the Philippines: What you should know
Outsourcing in the Philippines has turned into one of the many great approaches to minimising organisational expenditures, acquiring a competent workforce, and establishing an international presence.
However, before proceeding in this line, you need to grasp more strengths and weaknesses that are bound to be encountered offshoring to this Southeast Asian nation. It enables a company to tap into the Filipino workforce. Philippines has advantages such as lower costs, qualified human capital, and cultural affinity.
However, there are a number of barriers that affect firms offshoring to the Philippines, these barriers include cultural issues, language issues and security issues, which hampers the achievement of a successful and sustainable offshoring.
On a positive note, offshoring in the Philippines is a good business opportunity, which needs proper management and investment by the management teams, although there are several issues, which are worth being noted.
What to know when offshoring to India
Some of the key issues that should come into the light when India is contemplated to be as an offshore partner are as follows. India has a huge talent resource base in terms of professional and technical workforce, especially in the IT & Software and BPO sectors.
The country possesses a well-developed backbone; it has key cities such as Bengaluru (Bangalore) and Hyderabad that have embraced information technology, hence establishing the outsourcing services mostly in these areas.
Furthermore, the compatibility of Indian culture with Western nations and the high usage of English as a medium of communication also helps in effective communication and more over business deals.
However, issues like cultural differences, and time zone differences might be some of the issues that might need proper handling and adjustment. In conclusion, it can be stated that India’s choice as an offshore partner can prove to be an asset in terms of staff skills and technological experience.
However, adequate attention should be paid to the possibility of cultural issues and their effective mitigation. This is why is India a top choice for IT and other service outsourcing.
Offshoring IT: India or the Philippines?
When it comes to offshoring IT services, businesses often find themselves weighing the pros and cons of two prominent destinations: proactively contest it, especially India and the Philippines. You must be thinking why are IT jobs outsourced to India?
Indeed, India has been globally acclaimed as the leader in IT outsourcing because of its abundant talent, professional competence, and reasonable charges. NASSCOM affirmed that the Indian industry has a staff of more than 4 million employees and earns billions of dollars each year.
Conurbations such as Bengaluru (Bangalore), Delhi, Gurugram and Hyderabad have become innovation hubs and have attracted multinationals and new firms. This enhances its ability to attract global clients because the country has good English skills and is acquainted with Western business culture.
While, on the other hand, the Philippines became one of the most significant competitors in the sphere of IT outsourcing considering the factors such as price, language barriers, and cultural suitability.
At present IBPAP recognises 3 million professionals in the IT-BPO sector which demonstrates the fact that the country has a competent workforce to address the needs of clients all over the world.
The advantageous position of the country with regard to the position of the time zones enables round-the-clock support and operations, thereby increasing the capabilities for recognition and flexible operations to be performed as far as the service delivery is concerned.
Therefore, the decision of where to outsource depends on certain distinguishing characteristics like the kind and level of business needed, the cost estimate and other strategic business initiatives, while both India and the Philippines can offer significant opportunities for offshore outsourcing focused on improving the technological competence of a company.
Offshoring customer service: India or the Philippines?
In considering whether to offshore customer service operations to India or the Philippines, India stands out as a premier choice for several compelling reasons. With its well-established reputation as a global leader in customer service outsourcing, India offers a wealth of advantages that businesses find hard to resist.
Boasting a workforce of over 4 million professionals in the IT and BPO sectors. India possesses an extensive talent pool renowned for its proficiency in English and adeptness in handling diverse customer service tasks. India offers lower prices because cost of living is lower compared to UK.
Cities like Bengaluru (Bangalore), Mumbai, Kolkata and Hyderabad serve as vibrant hubs of innovation, attracting multinational corporations seeking to capitalise on India's expertise in delivering exceptional customer service solutions.
While the Philippines offers its own set of advantages in terms of English proficiency, cultural compatibility, and strategic time zone advantages, India's longstanding reputation for excellence in customer service outsourcing sets it apart as the preferred choice for businesses seeking to elevate their customer service capabilities.
With a proven track record of delivering exceptional service and driving customer satisfaction, India continues to be the go-to destination for companies looking to outsource their customer service operations and gain a competitive edge in today's global marketplace.
Read our blog on offshoring trends to make sure your business is future ready.
Offshoring talent: India or the Philippines?
Deciding between India and the Philippines for offshoring talent depends on several factors such as the specific needs of your project, the skills required, language proficiency, cultural compatibility, and cost considerations.
India has long been a popular destination for offshoring due to its large pool of skilled IT professionals, particularly in software development, engineering, and technology-related fields. English proficiency is generally high, and India has a well-established outsourcing industry with experience in serving global clients.
However, time zone differences may pose challenges for real-time collaboration with teams in other parts of the world, which can be handled. On the other hand, the Philippines has emerged as a strong contender in the offshoring market, particularly in customer service, back-office support, and moderation.
Filipino professionals are known for their excellent communication skills and cultural affinity with Western countries, making them well-suited for roles that require direct interaction with clients or customers.
Comparison between offshoring to India vs Offshoring to Philippines
To understand which is cheaper, India or the Philippines, why are IT jobs outsourced to India or why is customer service popular in the Philippines. Here is a quick comparison:
Still confused? Here is a detailed blog on why you should offshore to India.
How to know if offshoring is right for your company
You need to consider offshoring if:
- Clear objectives demand cost reduction or skill access.
- A cost-benefit analysis favours offshore savings.
- Required skills are abundant in offshore locations.
- Cultural fit and communication align with offshore partners.
- Risks can be managed effectively offshore.
- Strategic goals align with offshore expansion.
- Legal and regulatory requirements support offshore operations.
- Reputable offshore partners offer the necessary expertise.
- Change management supports offshore transitions.
- Continuous improvement justifies offshore investments.
How Black Piano can help you offshore to India
Black Piano can facilitate your offshore operations to India by:
- Providing expert guidance on setting up operations in India.
- Offering insights into India's business environment and regulatory landscape to get your Indian working faster.
- Assisting in identifying and recruiting skilled talent in India.
- Establishing communication channels with offshore teams in India.
- Managing cultural differences and fostering collaboration between onshore and offshore teams.
- Implementing best practices for project management and delivery in an offshore setup.
- Offering ongoing support and consultancy to ensure the success of your offshore venture in India.
… All of these bits for a small monthly fee!
Worried about cost? Don’t be! Use our cost of an employee calculator to see how much you save when you offshore or outsource to India. Read our blog on Why you should offshore your IT services to India to analyse your business gains.
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