Global vs local outsourcing Do these differ? Depends. There is no simple “yes” or “no” to the question. The concept “of outsourcing” refers to a business procedure where an organization recruits a third party to execute activities, improve operational efficiencies, or offer services on the agency’s behalf. This might signify that you could contract with a company nearby or a third party on the opposite side of the globe to perform a task, a professional background, or an entire team. Offshoring is another word for global outsourcing, which is the practice of outsourcing jobs to a third party based internationally.


A compound annual growth rate (CAGR) of 8.5% is projected for the global business process outsourcing (BPO) market, which is currently valued at $245.91 billion and is expected to reach $435.89 billion by 2028.

It’s not unexpected that 70% of CEOs cite cost savings as their primary justification for outsourcing. The 2020 Global Outsourcing Survey by Deloitte states that expense is what empowers people to outsource their work anywhere in the world. The situation won’t occur if there is no positive cost scenario. Everything revolves around finances. Many small businesses may lack the capacity or operational requirements to recruit a crew or outsource work locally.

Flexibility cited as 40% of executives’ top benefit, is another factor that makes offshore or global outsourcing to a lower-cost economy so desirable. In addition to reducing costs, a Clutch survey found that 24% of small businesses use global outsourcing services to improve productivity, with another 18% utilizing it for professional support.

The impacts of the epidemic in recent years have made technology innovation from an IT marketing perspective a rapidly developing trend. Better cybersecurity measures and more capacity are now required to keep up with Industry 4.0 developments as an outcome of this. 83% of top IT companies are evaluating partnering with global outsourcing services to tackle digital communication risks.

An international talent shortage is another current “umbrella” problem that is affecting businesses in many industries. Approximately US $8.5 trillion in yearly sales remain unrealized as a result of 69% of organizations trying to find and keep qualified professionals. Therefore, firms may access high-quality, global intellectual capital by investing in global outsourcing techniques as opposed to only relying on the local market.


Now that you know “why” businesses outsource to other countries, let’s talk about some of the major advantages of partnering with offshore or business process outsourcing (BPO) companies.

  1. Cost Savings

Global outsourcing may help your company save money by having day-to-day activities performed in a lower-cost economy. In some countries where labor prices are up to 70% cheaper. Hiring new employees is a costly procedure. Hiring a new international staff incurs several overhead expenditures. There are various global outsourcing models available today, and it’s critical to select the one that works best for you.

  1. Enhanced efficiency, quality, and customer satisfaction

Global outsourcing enables you to assign time-consuming and repetitive duties to an offshore employee rather than your onshore team. As a result, your local team can concentrate on what they do best and what inspires them, while your offshore workforce welcomes the opportunity to serve your company. This combination improves overall productivity. In the long term, global outsourcing improves workforce productivity and job satisfaction.

  1. Scalability and business globalization

A lack of finances to invest in new resources to accomplish growth goals is a major reason why businesses struggle to expand. Businesses frequently lack the time to hire a new employee to capitalize on potential growth prospects. Some global outsourcing companies can set up your outsourced workforce in as little as six to eight weeks. This allows you to accumulate funds that may be reinvested in the expansion of your company. You may expand your organization’s ability to take on more work with the support of a globally outsourced workforce.


It is important to realize that to minimize errors or misconceptions, firms must undertake due diligence and study possible outsourcing providers and locales..

Here are three main areas that might be limiting issues if attention is not given to picking the correct outsourcing provider for your organization:

  1. Language differences

Many global outsourcing firms operate in low-cost economies. Because English is possibly not their first language, this might have a direct influence on their degree of English competence. However, countries such as the Philippines have English as one of their official languages and utilize it in their educational institutions for both spoken and written communication. When determining which outsourcing destination to use to offshore your company’s needs, it is critical to perform your study to ensure that language does not prevent you from obtaining the advantages of global outsourcing.


  1. Social and cultural considerations

What is customary in one country may not be in another. This is true for both societal and cultural norms. Some cultures, for example, may be reserved and may not be as upfront or open to comments as you are expected to be with your local team. To minimize misconceptions, it is essential to create effective methods of communicating deadlines, Metrics, and any issues you may have.

  1. Data security

You will be transmitting personal business information to your global outsourced workforce for them to perform their duties effectively. This can provide data security threats and must be addressed appropriately. Ascertaining that your outsourcing provider has in operation cybersecurity strategies and management plans to mitigate any potential data security threats.


The basic answer is “everyone” and “yes.”

From CEOs and local workers to customers and your offshore workforce, global outsourcing may benefit everyone involved if performed appropriately.

It may assist businesses to increase efficiencies while also providing flexibility to scale and operate, allowing many to reinvest in other aspects of their business.

Outsourcing just one administrative duty frees up time for your local team to focus on other, higher-level activities. This might include maintaining customer contacts or launching preparation for a project that has been delayed for several months due to administrative overload. This creates a cascading “efficiency benefit” down the line, indicating that more work may be done onshore that is less time-consuming and more focused on business growth.

“Is outsourcing ethical?” is a significant issue that many businesses examine before acquiring an offshore operator. As stated previously, the short response is “yes.” You’re giving individuals in other nations employment and opportunities at competitive pay. 

To safeguard the rights of private employees, businesses that want to hire outsourced staff are frequently obligated to comply with international labor protections, which are strictly enforced, further safeguarding the offshore workforce. The key to getting it right is to partner with the right outsourcing firm.


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