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Stephan Spencer Stephan Spencer   Bio
05.08.08

Drawbacks of Outsourcing to India or China

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The cost savings of outsourcing low-level work overseas to countries like India, China, and the Philippines can look pretty attractive. But it's folly. The lack of language skills among the outsourced employees can lead to misunderstandings, lost credibility, customer service complaints and missed opportunity. I learned this first-hand. I tried outsourcing some of my personal work to a virtual assistant firm in India. I wasn't so much concerned with saving money as I was in freeing up the time I spent responding to email and performing other tasks that did not necessarily merit my personal involvement. Just like all of those companies that outsourced their call centers, I saw the error of my ways after seeing the difficulty my virtual assistant had with basic email communication. One of his emails to me, with the subject line of "Results can be even worthier than you pay!" sounded like spam and I almost deleted it by accident! His email continued "I am really exicted about our newly build relationship." Egad!

It's not that delegating and outsourcing are bad or wrong -- on the contrary, as I wrote in a recent MarketingProfs article, farming out tasks that you don't absolutely have to do yourself is the key to greater productivity and reduced stress. The more work you can assign to others, the more time you have to concentrate on issues that genuinely need your attention. But be careful whom you outsource to. Do you really want someone who can barely speak English to answer your phone or handle your email? (Though it's not meant to be funny, this podcast interview with a Chinese virtual assistant company CEO amusingly illustrates this point.) In fact, do you really want that person to do anything of importance for your business? I sure don't -- so much so that I recently fired my India-based virtual assistant.

The issue is not the country that you outsource to; it's the quality of the people doing the work, or at the very least, the quality of their language skills. Outsourcing to a country where the native language has to go back four branches to find a common ancestor with English is, I have found, rarely a good idea. I shudder to think of the aforementioned guy acting on my behalf, replying to my business-critical emails in Borat-speak. I realize now I could have avoided this whole debacle by taking some common-sense precautions, namely the ones recommended by Tim Ferriss and outlined in my above-mentioned MarketingProfs article. These are:

  • Make enough inquiries to receive 20-30 proposals.
  • Look to hire multiple virtual assistants; never hire a single individual -- you don't want your project to fail because someone got sick, took a vacation, or quit on you.
  • Immediately delete any boilerplate form responses when evaluating initial responses.
  • Test your VAs by assigning easy 20-30 minute tasks to the top 3-5 candidates. This will eliminate around 50% of them.
  • Next, test them further by taking a longer project (20-30 hours), and assigning it to all three. Ask them to stop after three hours and send you what they've completed, and you will know who performs best.

To reiterate, I'm in no way against VAs -- the concept is wonderful! But I needed to be a little more picky about which company and which individual VAs I chose. So with the above points in mind, I was able to find a much higher quality company based in Canada. The VA I chose there costs a lot more money, but I'm getting a lot more value out of her work. Now if my credit card company would only follow the same advice, I won't need a translator to talk to them...



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Comments

Thank you for bringing to light the positives of contracting with a Virtual Assistant who speaks your language and is genuinely concerned about the quality of work that is produced for you.

Posted by: Deirdre Shockley | 05.08.08

The more you outsource, the weaker the economy will be for the U.S.

Posted by: MarketingDeviant | 05.08.08

Spencer: I just spent a day on the phone with Lenovo, who make a huge effort to say that they, "... are now connecting you to our technical support team, located in Atlanta, Georgia..."

And they are in Atlanta. Amazing. PC doing fine now, too.

Posted by: Stephen Denny | 05.08.08

Hi, Stephen. I guess we had similar thoughts this week. Check my post.

I always believed that you get what you pay for. It's much more difficult for someone outside the continent to manage client relationships with the same manner that someone on this side of the ocean can. It's about language, idioms, expressions, experiences, etc.

Posted by: Elaine Fogel | 05.08.08

I'd like to add that business people in, say, China or India, would want fluent speakers and writers of their own languages as assistants as well.

This logic applies to business people the world over...

Posted by: Neil Anuskiewicz | 05.08.08

That's why it's IMPORTANT to seek Virtual Assistants in the right places! There are professionals associations out there that have virtual assistant directories and professional members who will look after you well, irrespective of what country they are in. They had to meet criteria in order to join these groups. There are over 20 of them worldwide.

With respect to having only one VA - why not? It depends on the work you want done. Some clients work with multiple VAs and some with only one. My longest term client has been with me 11 years and I have been her only VA for the majority of that time. But one MAJOR difference. I am backed by the VA group I belong to, and if I should fall sick, or go on leave, I have a back up team who look after all of my clients for me in my absence.

Also, if you go through the professional associations you eliminate the need for testing.

http://vanetworknews.com/va-organisations/ will steer you in the right direction!

Posted by: Kathie Thomas, A Clayton's Secretary | 05.08.08

This is a very timely discussion and one of the issues professional VAs adress regularly. If you are curious about the potential of working with professional VAs, accept our invitation to attend an "Introducing the Virtual Assistant Industry to Savvy Business Owners" series.

Savvy business owners understand the value and advantages gained over their competition by working with dedicated, experienced, professional assistants focused on their business growth and development. Virtual assistants save entrepreneurs time, money and sanity, and allow them to concentrate on income producing responsibilities that fuel their passion.

To learn more about working with professional VAs, attend the first, No Admission Fee, Internet-based "Introducing the Virtual Assistant Industry to Savvy Business Owners" series. Click here for details: http://www.oivac.com/intro.htm.

These complimentary sessions occur during the annual VA industry online convention, Thursday, May 15 through Saturday, 17, 2008 (US).

The agenda will include a short presentation, followed by a roundtable discussion led by veteran VA industry experts eager to answer your questions. Attendees can learn how to select the right VA, tasks VAs can perform, etc., ask niche-specific questions, and much, much more.

If you ever considered working with a VA or are curious about exploring the potential, be sure to attend online.

Select the session that best fits your schedule:

Session 1 - Thursday, May 15, 2008, 1 p.m. - 1:45 p.m. US EDT

Session 2 - Friday, May 16, 2008, 8:30 a.m. - 9:30 a.m. US EDT

Session 3 - Friday, May 16, 2008, 3:00 p.m. - 3:45 p.m. US EDT

To learn more about this exciting, one-of-a-kind activity and to reserve your complimentary seat at one of the three (3) sessions, visit OIVAC http://www.oivac.com/intro.htm.

Attend from the comfort of your home or office; via computer and headset mic. Mark your calendar for this informative event. We look forward to seeing you.

Please contact info@oivac.com or call 1-410-521-7001 (United States) if you have questions.

Posted by: Sharon Williams | 05.08.08

Thank you for writing about this experience. So many people look at cost as the only factor in deciding on a VA but there are so many more, especially their grasp of the English language if thats what you will be communicating in.

Posted by: Louise Pack | 05.08.08

There are many languages and many strong economies, the key issue here is that one must have an assistant with whom one can work. It is simple as that.

We should not presume that English is the only language on the planet! I as a an American, have done a lot of traveling and am humbled by this world.

Posted by: Neil Anuskiewicz | 05.08.08

What you are referring to in this post isn't Virtual Assistance, it's simply hiring remote secretarial workers. That's not the same thing.

The Virtual Assistance Chamber of Commerce is a fantastic resource for business owners seeking qualified and competent Virtual Assistant professionals. Of particular interest:

Client’s Guide to Virtual Assistants:
http://www.virtualassistantnetworking.com/client-guide.htm

How to Hire a Virtual Assistant:
http://www.virtualassistantnetworking.com/how-to-hire-a-virtual-assistant.htm

Virtual Assistant Directory:
http://www.virtualassistantnetworking.com/directory/

RFP Center:
http://www.virtualassistantnetworking.com/rfp-center.htm

Get to Know Our Virtual Assistants:
http://www.virtualassistantnetworking.com/subscribe.htm

Posted by: Danielle Keister | 05.08.08

Incorrect information abounds about what a VA is and does. VA's are business owners, not employees. If they are willing to take a "test" then you are not working with a VA that understands the business model! Seriously, would you even consider asking your plumber or attorney to take a test before hiring them? Educate yourself about what a Virtual Assistant is and is not. Read http://www.virtualassistantnetworking.com/client-guide.htm to bring yourself up to speed AND find a vetted VA!

Posted by: Cheryl A. Harless | 05.08.08

Taking the service of professionals’ expert at outsourcing in India & China companies can make their existence felt to new markets which opens a brand new world of earnings with nominal struggle.

Posted by: outsourcing company | 05.13.08

Ohh... how unfortunately true.
In the quest to save a few $$ I wound up with an extreme time zone difference and Borat on steroids. With all of the effort and trouble at the end of the day I would have been better off finding someone stateside.

I think we all need to keep the drawbacks in mind and follow the advice of Tim and Stephen, make sure you do a thorough survey before you leap. It’s not all bad, but it takes effort that we don’t always want to give to find what meets the needs of all parties involved. Remember the canyon maybe a lot deeper than you think!

Posted by: Ivan Printis | 05.19.08

There are a lot more success stories on outsourcing to India or China than there are failures as evidenced by their continuing growth. The world has globalized and with it millions more are able to have access to better education, healthcare and lifestyles that multiple generations of their ancestors did not. India as a republic for example is a young (just 60 years old as against the US which is 325+)diverse country (has more states,distinct cultures and languages than the EU!), and what it has achieved in the last 10 years is remarkable thanks to the dedicated efforts of many such 'virtual assistants'. The growing middle class now has become a lucrative market for many multinationals including US companies. A larger perspective that should not be lost compared to the few customers a credit card company might lose or the few minutes of frustration that we as individuals may have to go through.

Shekar Prabhakar
http://marketingshiksha.blogspot.com

Posted by: Shekar Prabhakar | 05.19.08

Interesting that a person posted that Outsourcing is destroying our economy. I imagine it has nothing to do with the wars or budget deficit?

One thing that Capitalism and Globalization teach us is the beauty of Free Trade. Why should someone in another country not get a job? You are better than them as a person? If you are in a country of privilege such as the USA, why would you not educate yourself or pursue a more rewarding field than the jobs that are being outsourced? Outsourcing is efficiency. Efficiency in all forms will always win. Constant improvement cannot be beaten so you're better off to see the wave coming and learn to ride it instead of swimming against a tsunami.

Concerning Virtual Assistants, yes you MUST test them out before hiring them full time. We deal in the IT industry and it is the same way, you have to give them small projects first and see how they turn out. Keep only the very best. Once again, efficiency.

-Nathan @
http://www.HiYaYa.com

Posted by: NSL | 05.19.08

You have obviously gone for the bottom priced alternative and have literally "paid" for your over thriftiness. Let me remind you that Indians are by and large 'English' literate and often more at ease with the language than their western counterparts who call English their 'mother tongue'. Check with the many Universities in UK/USA/FRance and other parts of Europe and you will find a large number of 'Indian" professors teaching western students the English language.

I agree you need to be a lot more "picky" (incidentally this word does not exist in the Oxford dictionary).

Posted by: deepak jhangiani | 05.20.08

Over the years I have bought a lot of services and products from US based companies, over the Internet. A couple how been outright scams. Some have been poor quality. I have learnt to be more discerning. There are a lot of good providers of products and services in the US of A!

Posted by: Prakash | 05.20.08

Don't get me wrong, I am working in one of the Big IT companies in India, but now I am sick and tired of their hiring policies. Read on


Software companies in India are recruiting "Lamers" who don't have any experience..., wait a minute, they don't even know a thing about computer science. Don't believe me? Let me give you an example, a person hired straight from college as a software developer by a Big Indian IT Company (A Really Big One.. They have got the BT project... you know..!), he has been chosen as a developer on java, he came crying to me asking he can't figure out how to create an ODBC connection (in windows). Can you believe this? I explained him the process with screen-shots from modemhelp.net( cause I was running Linux on my system so..). More surprises, he couln't differentiate Linux from windows (it was obvious, he had never ever seen a non-windows system in his life so far), so when he saw my terminal (I had Open-suse with default KDE running on my system with a terminal/console open), he asked me to show him how to create the ODBC connection from the control panel... what a Lamer! People selected for .Net have no idea about what an web-server is and what is IIS.

People are hired from non-IT background and sometimes non-computer background (students from civil, mechanical, or electronics engineering) on the basis of merit tests where they ask questions like in the banking jobs(??). This is done intentionally so that they can force these lamers to work for peanuts for almost 12 hours a day regularly. Most of the time, lamers are overworked and underpaid and they don't have the skill to finish the job in an efficient manner. They are always frightened of losing their jobs and so they manage to finish their responsibility in every irresponsible way possible. You know what I mean, sorry, English is my second language!

Companies prefer these novice people over trained professionals because they can pay a lot less.

As far as IT and software is concerned, this is no easy job and definitely not for an average joe, we all know that. One has to be pretty strong technically to understand the specifications, leave out writing codes. We are at the edge of unparalalled complex business demand and increased complexity of software design getting more and more complex every day with standards like web2 and distributed architecture. Now how far do you think hires like these can go even with specialised training. They put an intense pressure on these employees forcing them to learn the technologies and they simply don't have foundations to build on. It's like pushing a business graduate to cram up Quantum Physics!

If you happen to visit any of the Indian IT firms, you will come to know about an amazingly bad work culture where people always find their excuses for an unfinished job. Some companies are run like pumping stations where you come, you sit, you roam around, you have your lunch, you chat with the lady sitting in the next cubicle or on the Internet, ok it's 4:30 in the evening, let's go home half an hour early. The word "proactive" is not a part of their dictionary.

Consequently, these Indian IT companies are losing quality of the service in the domestic market as well as in the international market. God only knows how they meet their deadlines even after hundreads of reviews of code and scary programming practices. Companies like Tata Consultancy Services, Tech Mahindra are losing projects in india as well (they have got a very bad remarks from clients like SBI, Central Bank of India and many others and they are steadily losing projects even in Indian markets for hiring these lamers).

Some US companies have taken back their projects to US after finding out the truth about Indian IT Companies A lot of them have found out they can manage to achieve a productivity 2 to 6 times greater than what it was when outsourced to India!

Bottom line------- DO NOT OUTSOURCE YOUR PROJECTS TO INDIA, ITS GOING TO COST YOU MORE IN EVERY POSSIBLE WAY AND YOU WILL LOSE GOOD WILL OF YOUR CUSTOMERS. DO NOT FEED THESE LAMERS WHEN YOU HAVE AN EXCELLENT IT STAFF IN YOUR COUNTRY UNEMPLOYED!

Posted by: Tyler | 06.09.08

I feel for you , but it is as you have once mentioned - not the problem with the country but a problem with the selection of people .
You might find this post interesting , http://websys.co.in/designblog/2008/05/31/language-barrier-a-problem/

Posted by: outsource web development | 06.14.08

Hello people,
Being an Indian and living in this very over populated and under appreciated country I can only offer this piece of advice to anyone looking to outsource.
Please ensure that the clauses in your service agreement are quality centric. People make the mistake of laying down clause related guidelines especially in outbound outsourced work.
Make sure that the companies applying for the outsourcing are backed by decent qualified man power and certifications i.e. if they say "quality data security" then ensure that they have the ISO 27001 certification.
Please do your homework on global business clauses so the party being outsourced to has legal liability and can be sued for fraudulent usage.
------
My reasons are that there are a dime a dozen and fly by night BPOs here which hire the underqualified for their cost effectiveness and give them a rubbish training but a big project.
And definitely be stricter with their service delivery than you are with a local service provider as they should also realize that the client is not to be taken lightly.
There are some really customer centric companies here who have very skilled manpower for customer relationship management and secretary work.
Do bargain with the manhour rate as well. Since the people are all the way on the other side of the planet, small world or not, be wary of the terms and conditions of service and remember that they need the business but you can demand better as a customer.

Posted by: Sondhi | 07.23.08

Sondhi,

To some India may be under appreciated but I think that India is a great country and on its way to becoming one of the greatest democratic economic powers on the planet.

Many of of us here in the U.S. see a political and economic trading partner.

Here in the U.S. many of our most ambitious and successful people were born in India or of Indian descent. I know some of them personally and am impressed.

Posted by: Neil Anuskiewicz | 07.24.08

This is a nice posting. I really like this post.

Posted by: Modulesoft | 07.29.08

Great post!

I am using www.BPOVIA.com and very pleased. They are the best virtual assistant service provider I ever tried. Their hourly rate is below $10 per hour.

www.BPOVIA.com is the only virtual assistant service provider ever won the prestigious "Red Herring Top 100 Global Company in 2008" Awards.

Posted by: Nick | 01.31.09

Stephan, there are many forms of outsourcing (application outsourcing, HR outsourcing, IT etc). It is not at all logical to generalize the capability of a supplier just by the language ability. I have outsourced a lot to India, where I found an extremely competent workforce when compared to our people here in the US. If you ask someone to "speak the language for you", then you will see better people than you or worse; it's relative. I have been to India on so many business trips, where I saw more than sixty different languages spoken in one country and many of them can speak multiple languages. So they are more competent than us.

Posted by: Danny | 06.01.09

What I find incredibly amazing is just how gulible the US companies are to fall for the trap of Indian outsourcing like they have. We have created an economy in India that can only be sustained by the US being a customer of it. And consequently now I'm getting 5-10 telephone spam calls from Indian outsourcing companies a week trying to get business I have no intention in getting. The invention of the Internet shouldn't mean FREE VoIP calls from Indian companies who are just trying to sell $20 a hour services, in which they pay the person doing the service $2 an hour for.

In the garment industry, this is considered 'sweatshop' labor and when it is made public that companies are supporting this, it really is a PR nightmare. If anyone who uses Indian outsourcing realizes that they are supporting the same economy that will come back to bite them in the future, not to mention the quality of service is going to be restricted by language and cultural barriers, then its a BAD IDEA to do this.

But I suspect that no one will stop doing this because they think the short term financial savings are more important. No wonder we're in the mess we are in.

Posted by: Vlad | 06.25.09

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