The Pros and Cons of Offshore Outsourcing

The Pros and Cons of Offshore Outsourcing

The Pros and Cons of Offshore Outsourcing

Outsourcing, in the context of Business Process Outsourcing, can be defined as the performance of certain processes essential to the creation of the intended product or service being done by a unit or company or business other than the owner of the final product or service. A legal firm may outsource transcription of dictated submissions and a startup might outsource its payroll processing.

Starting out as an almost contiguous establishment, meant to reduce pressure on high-cost real estate and resources, advancements in communications and software technologies have made it possible for work to be done from anywhere in the world. This has given rise to the phenomena that is offshore outsourcing which is a term used to describe the geographical proximity of the supplier, or lack of it, from the clients’ geographical position. It is normally used to indicate the vendor’s location in another, distant country.

If the vendor is located in a country that is contiguous or close, the term used is ‘nearshore.’

Some people also use ‘farshore’ to indicate the vendor’s location as being distant, but is not a popular usage. Neither is ‘sameshore’ which indicates presence in the same country. 

Enumerated here is an evaluation of some of the prominent benefits and challenges the strategy offers.

Advantages

Lower cost

Cost being a number, is transparent, clear and quantifiable and does not leave room for interpretation or doubt. This has been, and continues to be, one of the primary reasons for the existence of outsourcing as a business model.

Business has always been sensitive to opportunities of making and saving money. Offshore outsourcing has created one such opportunity. Each geography in the world has its own unique history and pattern of development bringing them to where they are today. The range is wide and the gap enormous between rich and poor. According to a World Bank report for 2019, the per capita Gross Domestic Product (GDP) in USD terms was 507 for Afghanistan while it was 55,060 for Australia, almost a hundred times greater. And these are not the most extreme figures in the table.

Just like a natural resource like water will flow from high to low ground, in a free market system, which is what much of the world today follows, work will move from a high cost to a low cost center, across the seven seas. While on the one hand the business that is transitioning work offshore will gain a competitive advantage, it will also result in raising the income levels and work opportunities in the delivery location.

oWorkers operates from some of the most highly rated locations for outsourcing in the world. Our clients report savings of upto 80% when they outsource to us. Our operational efficiencies enable us to save costs which we are able to share with our clients.

Access to a bigger expertise pool

“Clients come for the cost savings but stay for the quality” is how many BPO companies engaged in the business like to believe as the reason for their success. And they may not be wrong.

With the benefit of a high volume of similar transactions across multiple clients, offshore data entry outsourcing companies are able to develop proficiency in some of their areas of work, aided by adding a few industry experts at leadership levels to guide the business. This also enables providers to out their best foot forward as a knowledgeable organisation when they pitch for new business in that vertical.

From the clients’ perspective, the expertise built by a provider will only be beneficial in delivering them greater efficiency and quality. There could be the issue of being dependent on an external party which could be overcome by splitting across vendors it reached that point of risk.

oWorkers operates in its chosen areas of data entry, annotation and content moderation and has delivered successful results to over a hundred clients over eight years of operations. In many cases, on account of the expertise we have built, clients initiate the process directly with us, without first implementing inhouse and then transitioning.

Benefits of scale

By itself scale may not be an advantage form offshore outsourcing but it has the ability to trigger the release of several benefits. As a result of developing expertise in certain areas, providers create a brand value for themselves that results in attracting more similar business. This results in creating a large volume of similar activity or work through aggregation of the work of several clients. What this does is:

Reduces the unit cost of processing – Indirect costs, which do not increase with the volume of transactions, get shared over a larger number of transactions and resources, lowering the unit cost. This enables the vendor to earn profits as well as share some part of the savings with the client.

Enables technology investments – With aggregated volumes, investing in superior technologies often becomes possible and viable. This investment releases further efficiencies in the form of lowering manpower expenses and speeding up processing. Individual clients, with their limited volumes, may not have been able to justify the investment that the vendor is able to make. Working like aggregators, suppliers have even been able to create platform solutions for processes handled manually.

oWorkers partners with technology solution providers to leverage advancements in technology for delivering on client contracts.

Time Zone related benefits

Offshore outsourcing creates an additional variable in the form of time zone difference between the client and supplier.

Some benefits accrue when there is a large difference in the two time zones, both being ranged on roughly the opposite ends of the 24-hour scale, say client being in New York and processing organisation in Manila, roughly 12 hours ahead. What that does is create an overnight processing window. By the time business shuts down in New York it is time for Manila to start working. Work allocated by the client before the end of their business day is processed in Manila when they start their day, and possibly complete it during the day while New York is asleep. By the time they start work the next day, the allocated work would have been turned around, processed, almost like a fairy who waved a magic wand while they were asleep and completed the work.

This happens when there is a significant East-West displacement across the globe.

If the displacement is North-South and not East-West between the client and vendor, it means the two are likely to be in a similar time zone, which could facilitate handling processes that require greater coordination and interaction between the two sides. The key is choosing processes that can benefit from these displacements.

The three centers of oWorkers lie almost at the center of the world. They are located in time zones similar to Western Europe, and are far away from North America, the two main client locations. This allows us flexibility in providing overnight turnaround to US clients as well as being available during working hours for consultations and interactions for Western Europe. In any case, our 24×7 centers ensure that we are able to meet all client requirements.

Access to resources globally

In a competitive world, running a business successfully is hard enough. The need to manage many moving parts makes it all the more challenging. 

Offshoring often takes away some of the pain attached to managing these moving parts, like managing human resources that are required for the work. Getting the right quality at the right price is already difficult. The business also experiences peaks and troughs requiring adjustments in staffing numbers. If the business grows, it does not want to struggle for resources to support its growth. These are some of the human factors that offshoring can assist your business with.

oWorkers operates as a local registered company in all its locations. It is a contributing member of local communities. As a preferred employer, it receives a steady stream of applications that reduces its hiring costs as well as attrition numbers. It also gives oWorkers the flexibility to hire short-term resources to manage peaks, to the tune of almost a 100 resources in 48 hours.

Challenges

Disenchantment of processors

The objective of offshore outsourcing often being to create processing efficiency results in the breaking down of processes to small, repetitive tasks. Over time, this has the potential to create boredom and burnout amongst processors that can allow carelessness to creep in, leading to errors. Not only can this impact the processors, but even other roles that are supposed to monitor errors.

The employing organisation needs to ensure it has systems in place to capture processing errors before they become noticeable by the client.

oWorkers monitors the performance of each individual and provides opportunities for job rotation designed to keep employees fresh and engaged. In addition, fair and transparent employment practices, mandated by our presence in the Eurozone, also create confidence and engagement.

Intellectual Property risk

There are many reasons for some parts of the world being cheaper than others, one of then being a relative lack of governance and enforcement of laws. Such an environment can create a threat for the intellectual property owned by the client that is shared with the vendor engaged for offshore outsourcing, necessary for handling the outsourced processes. It is not unheard of to find that the IP has been violated or there are versions of processes and products available soon after.

In addition to GDPR compliance, oWorkers operates from super secure facilities & protocols for the security of client data and is also ISO (27001:2013 & 9001:2015) certified. Each staff member signs a non-disclosure agreement (NDA) before they are permitted to process client data.

Labor malpractices

While one can debate if there is greater respect for people in what are considered to be ‘developed’ societies or in ones considered to be lower on the same scale, in offshore outsourcing, the issue of labor malpractices has to be viewed through the prism of the client’s regulatory environment as that is what they are answerable to. If the client is from a society where labor malpractices are reasonably clearly articulated as well as enforced

If the supplier operates in an environment where there is greater acceptance of practices such as child labor on account of the prevalent poverty, while the client environment clearly prohibits the same, it could create issues for the client in their markets as well as with regulators, if their use of a vendor indulging in such malpractices becomes established.

Having adopted the model of working with employed resources as opposed to freelancers, oWorkers is committed to the career progression of its staff and offers a fair and transparent work environment drawn from best practices around the world. Our staff are also free to choose to work from home as long as the shadow of the Covid-19 pandemic looms.

Cultural differences

It is sometimes said that though the main language might be the same, the dialect and version change every hundred kilometres or so. Two villages in Germany a hundred kilometres apart will be speaking German but have their own unique variant. As will be the case with the Hindi spoken in two villages in Central India a hundred kilometres apart. Culture and customs also change from one place to another.

Offshore outsourcing, where the distance between the two parties could be thousands of kilometers, such differences are likely to get magnified and could result in some amount of misunderstanding and errors creeping in. Sensitivities pertaining to cultural differences could get further magnified if the process involves customer interaction, like Contact Center support and could even result in customer dissatisfaction.

oWorkers, with a center in Europe, which is within three hours of flying time away from any major city in Europe, is culturally aligned to support customer business for Western European clients. In addition, our chosen areas of specialization that focus on data related work, mostly involved interaction with client staffers and not customers.

Hidden costs

While the business case looks promising, there are hidden costs in offshore outsourcing that could tilt the balance. Grid-supplied power supply may be erratic requiring investment in private generating capacity. Travel costs could increase as there will be a likelihood of outsourcer staff needing to travel to the delivery destination to ensure processes are followed and issues resolved. Local events like political unrest and demonstrations could jeopardize business continuity resulting in down time.

oWorkers provides transparent pricing to clients including a choice between rate per unit of output and rate per unit of capacity. Once a price is agreed, all additional costs are borne by oWorkers. We make arrangements to augment resources like power supply in centers where grid supply could be erratic. All costs are factored in when we quote a price so that there are no surprises for clients.

In Conclusion

While there are clear benefits offshore outsourcing delivers to a business, it comes with its own set of limitations which need to be managed. Successfully managing the downsides while taking advantage of the benefits results in creating value for the business.

There are political sensitivities associated with it as well, as it seems to reduce local employment while generating employment in faraway lands, even though many such views have been debunked in the past. In a free market, the flexibility of businesses to operate in a manner they deem suitable, while abiding by rules and regulations of the geographies they operate in, is seen as a fundamental right.

Operation Optimization: Optimize Your Business Operations With These 5 Strategies

Operation Optimization: Optimize Your Business Operations With These 5 Strategies

Operation Optimization: Optimize Your Business Operations With These 5 Strategies

When Bob Beamon of the US jumped over 29 feet in Mexico City in 1968, not only did he set a new world record but shattered the earlier record jointly held by Igor Ter-Ovanesyan and Ralph Boston by almost 2 feet. Till then, long jump records were broken by a few inches at a time. Though dissenting voices have been there, considering the high altitude of Mexico City, the record was recognized and looked like one that would never be broken.

By the early eighties, the record already looked like being under threat, with Carl Lewis repeatedly jumping close to 29 feet. However, he never beat Beamon’s record. But, in 1991, Mike Powell did, by jumping almost 2 inches beyond Beamon’s once considered unbeatable record.

There are numerous instances in competitive sport, which is considered the pinnacle of human physical endeavor, where this story gets repeated. The once unattainable mark gets attained. Once unthinkable happens.

Like the 100 meter sprint. Again, the 9.95 seconds set by Jim Hines in Mexico City once looked unassailable. And for many years it was. Till Calvin Smith broke it in 1983. Followed by a raft of others like Carl Lewis, Donovan Bailey, Maurice Green, Leroy Burrell, Asafa Powell and several more. Then came Usain Bolt. The record is now an astonishing 9.58 seconds. Any bets if it will be bettered some day? You bet it will be.

The human story is one of constant endeavor. Trying to do it better today than it was done yesterday. Trying to do more for less. Trying to squeeze more out of less.

That is what business in a competitive, free world is all about. Continuous striving. Staying ahead of the pack. Fending off competition snapping at your heels.

And why should it not be like this? Nobody has an entitlement. We are long past the days of hereditary monarchs. You get what you deserve and what you are willing to work for.

For a business, it is the same.

An early entrant may have an early mover advantage but perhaps took higher risks at a time when others were not willing to. So, their early success might be a justified reward for that risk and initiative. A later entrant might have found it tougher to get clients initially, but perhaps had the benefit of learning from the example of the early movers, resulting in fewer mistakes.

Whoever you are, early entrant or latecomer, successful business or a struggling one, part of a conglomerate or a standalone, the future is open. All actions taken by the business are designed to usher them into a future that is better than the present.

Each business needs to keep tinkering with the many moving parts to discover better ways of working. In order to give it a chance to stay ahead of the curve. Exploring, changing, adjusting, reducing, increasing, starting, closing, launching. This is known as doing operation optimization and needs to be a continuous activity where the business is alive to opportunities at all times.

Of course, there are no guarantees. Many times, these efforts may also not be enough to avert failure. Since the future cannot be foretold, efforts need to be made.

Of course, easier said than done.

A business is a complex animal, dependent on a complex interplay of numerous variables, many of them completely out of control of the business. As an example, the onset of the Covid-19 pandemic was not foreseen by anyone.

How does one go about doing it?

Clearly, there is no rule-book or SOP that is available that could be implemented for everlasting success. Such a process, in any case, would militate against the concept of competition which would be eliminated if there was everlasting success for everyone. Hence, it is a fallacy, ab initio.

Having said that, over the course of recorded history and the emergence of the joint stock corporation and the establishment of the free market, many practices have emerged as best practices and are relied upon by companies for at least basic hygiene, if not everlasting success. We will discuss some of these practices here.

 

Defining clear goals – why are you in business

While there may be no doubt about the reason for the existence of a business, that of making a profit for its owners, the methods vary widely. One could run a business writing software code or assembling cars, repairing bicycles or cooking food, constructing a building or growing food. And that is only at the top level. Within each industry there are millions of different opportunities and positions one could seize on. You could cook Thai food or Italian food. You could be making office buildings or bridges. And so on.

The main idea is that the business, through its leadership, sees an opportunity where they could make a difference and, by serving that need, get paid by their clients which would, ideally, lead to them making a profit. It could be while starting a new business or it could be at any point during the life of a running business. Each moment is a decisive moment. If at any point of time the assessment is that the business will lose more money than earn, there would be no logical reason to keep it running.

However, for operation optimization, till such a point is reached, and the business is running, effort needs to be made to define clearly its goals, along with a vision. This ensures that the people working for it are all pulling in the same direction and not against each other.

Having chosen our area of work, data based BPO services, oWorkers has strived to excel at it. We have been identified as one of the top three data services providers in the world. We are GDPR compliant and ISO (27001:2013 & 9001:2015) certified.

 

Customer focus is essential for operation optimization

In the last couple of decades, some large organizations have attempted to go beyond the ordinary and evolve taglines away from the customary client focus. ‘Employee First, Customer Second’ is one that comes to mind.

It is a great way to bring focus onto precious resources and allow them their moment in the Sun. However, make no mistake, the reason the company exists is for the customer. If there is no Revenue to be earned by selling products and services to clients for which they are willing to pay good money, what would be the reason for the company to keep working? To pay salaries to its employees? Honestly. No company has taken ownership for the everlasting prosperity of its employees. Fair and reasonable terms, yes. But no more.

For a business to make money, which is established as an inalienable truth, it needs to earn revenue. Where is the revenue going to come from? From customers. Hence, for any business, before anything else there is a customer, whose interest needs to be protected. Everyone in the company needs to understand who the customer is, as well as that part of her needs that are met by the products and services of your company. This needs to be constantly reiterated.

Having implemented over a hundred projects for clients from around the world, we are a trusted partner for most and are even given the responsibility of directly initiating new processes. We have built trusted relationships with several technology providers so that we can leverage the best technologies for client work. Our capability extends to over 22 languages which means our customers do not need to go hunting for new partners when they expand to new geographies.

 

Operation optimization needs transparent and fair employment practices

Since the dawn of the industrial age, many resources have emerged that seek to multiply power in order to either produce more, or consume less manpower, or both. In the present day, Artificial Intelligence (AI) threatens to make humans redundant by taking over all.

Despite all efforts, human beings continue to drive organizations and remain the most critical resource. Even for operating automated tools and programs, human beings are required.

It is important for a company to offer employment practices that are both fair and transparent. And they should be followed. There is no point in having a policy that says salary will be paid on the last working day of the month but in practice only paid out in the first week of the following month. While you may offer explanations for the same, nobody really cares for them. You have to keep up your end of the bargain.

Just like the company has choices, so do employees. They can choose to vote with their feet and walk out of the company and into the waiting arms of another. In a competitive world, there are many takers for good resources.

It is important to periodically refresh policies and procedures and ensure they reflect current times and expectations. As an example, paternity leave, unheard of perhaps just twenty years back, is now a common facility offered by many.

oWorkers has stayed away from the temptation of freelance and contract resources for client work and chosen the path of employment. While this places greater responsibility upon us, of compliance as well as employee development, it also provides greater satisfaction and flexibility. For example, if a client has a need for a short-term ramp, driven by seasonality or a new launch, we are able to cater to it. Being a preferred employer in the region, we also receive a steady flow of job applications through the year, keeping our hiring cost and effort low. Our employees have consistently rated us above 4.6 on a 5-point scale on Glassdoor.

 

Ear to the ground

The world keeps changing every moment and nobody is sure about the future. But all of us have educated guesses. Some of us might believe that AI will make humans redundant in the next 50 years while others may believe humans cannot be overtaken by AI. Some of us believe that jet-propelled solo flying will be the most common method of getting from one place to another while others may believe the pull of gravity will keep humans tethered to the Earth for the most part.

Whichever camp you are in, what is undisputed is that the future will arrive and that it will not be identical to today. Besides, except for the occasional ‘big bang’ event like an earthquake shaking up things or a volcano erupting, or, as we now know, a pandemic casting its shadow, most change is gradual. Almost glacial, though in hindsight it may appear otherwise. We may or may not have the ability to influence its direction, but, if we keep our ear to the ground, we will certainly be able to know well in advance which way it is headed and take suitable action as may be required.

While it is required to protect one’s Intellectual Property (IP), Copyrights, proprietary tools and technologies which give us advantage, for operation optimization we must also be open to participation at various levels so that we can both contribute to the change that is coming as well as understand it better by seeking out views of others who are in similar positions as us.

Most industries have associations that seek to promote the interest of the industry, there are cross-industry groupings for specific objectives, there are forums created by the government, all of them for the purpose of sharing and receiving information that might be relevant in navigating the path of our little business.

Services provided by oWorkers are at the cutting edge of technology. Much of the work we do is in data annotation and data labelling, that supports the development of AI models, as well as moderation of content on social media networks. A few years back these services did not even exist, but are the fastest growing today.

 

Leverage outsourcing for operation optimization

Outsourcing has emerged as a potential source for releasing significant locked value for a business. If not leveraging the outsourcing opportunity today, your company could become irrelevant soon.

No person or company can do all required tasks and activities all by themselves. We live in an interconnected world and the same is borne out in our business and personal dealings.

A car manufacturer does not manufacture many of the parts that go inside a car. It sources them from suppliers who are provided the specifications for the parts.

A software developer does not produce the computers its employees work on. It sources them for companies that make computers of suitable specifications.

At a personal level, we don’t grow the food we eat. We buy it from supermarkets that source it from farmers and agricultural communities. The beds and mattresses we sleep on are purchased from companies that make them. We don’t make them ourselves.

Hence, interdependence is a given. Outsourcing of activities that are not your company’s core competence, or which can be done better by another company, is the accepted method today. Thousands of startups are using outsourcing solutions to stay lean which enables them to invest in their core business.

Our leadership team comes with over 20 years of hands-on experience in the industry and are well placed to navigate the company through good and bad times. Our clients often talk about saving upto 80% of the pre-outsourcing cost when they outsource to oWorkers. With the help of a dedicated Quality team, you can expect operation optimization as an add-on service.

What Is Data Labeling? Everything You Need To Know

What Is Data Labeling? Everything You Need To Know

What Is Data Labeling? Everything You Need To Know

Let us begin with a definition of data labelling by Amazon which defines it as “the process of identifying raw data (images, text files, videos, etc.) and adding one or more meaningful and informative labels to provide context so that a machine learning model can learn from it. For example, labels might indicate whether a photo contains a bird or car, which words were uttered in an audio recording, or if an x-ray contains a tumor. Data labeling is required for a variety of use cases including computer vision, natural language processing, and speech recognition.”

Like most definitions, it says a lot but perhaps leaves room for more explanation.

The labelling of data highlights properties in the data that can be understood by a computer and used to establish patterns that enable it to predict what is known as the ‘target.’ In a data set for training autonomous vehicles, for example, these ‘targets’ could be traffic lights, pedestrians or lanes on the road. It allows the software program to assign meaning to raw data and establish patterns.

For example, an AI model being trained for identifying facial expressions and emotions may need to be trained by enabling it to first identify a human face and thereafter connect it with human emotions through the complex interplay of facial features. For example, drooping lips could be an identifier of sadness.

Context is important. Labeling varies based on the requirement and objective of the AI model which it is being created for.

oWorkers has been providing data entry and labelling services to power the AI ambitions of its clients. Its partnership with leading technology providers provides it access to the latest technologies for the task. The fact that 75% of its clients are technology companies, while a challenge in terms of high technology expectations, also ensures it stays ahead of the curve in leveraging technology solutions for its work.

 

The need for data labelling

An understanding of ‘what is data labeling’ cannot be complete without an understanding of the need for data labelling.

While data labelling and data annotation are sometimes used interchangeably, data annotation is also usually referred to as the process through which data labeling is achieved, or we produce labeled data.

A research by Global Market Insights put the market for data annotation at $700 million in 2019, and projected to grow to $5.5 billion by 2026.

What is driving this growth?

Artificial Intelligence (AI) and Machine Learning (ML).

Is it surprising?

Perhaps no. Analysts say that almost every piece of technology now has an element of AI embedded in it. In your pocket. In your car. In your home. The search engine recommendations that are tailored to our preferences, the expected time you will take to reach a particular place, the chatbot response to your query, the identification of a weapon in a video grab, there is AI everywhere, though we may not recognize it at the point of our interface.

And Machine Learning (ML) is the handmaiden of AI, working in the background to produce training data sets that will make the AI models smarter and smarter.

Training data sets produced for training AI models use labelled data, that make raw data understandable to a computer. It is estimated that 80% of the time spent on AI projects is in the process of creation of training data-sets and labelling them.

An AI model being only as good as the training data, it is a task of great responsibility. After all, we don’t want an autonomous vehicle not running over pedestrians 8 out of 10 times. The model needs to ensure that it does so 10 out of 10 times. There is no scope for error. 8 in 10 is just not good enough.

Operating as locally registered units in the three geographies it has centers located in, oWorkers leverages its position as an aspirational employer for local jobseekers to access deep talent pools to handle all kinds of labelling requirements. It also has the flexibility of seasonal or other ramps to the tune of a hundred people in 48 hours. With its preference for employed staff over freelancers for working on client projects and stable, transparent employment policies, oWorkers experiences best in class attrition and provides stable solutions to clients for all data labelling needs.

 

What is data labeling – Key Concepts

Label

A label is the tag or additional information added in the process of annotation to trigger the development of associations with identified features of the data. It is the basic unit of information on which training models are built. It needs to be remembered that labelling is contextual. Labels added to an image of a roadside for building AI for an autonomous vehicle may be very different from labels that need to be added to build AI to detect depletion of greenery in a particular location, even though the image may be the same.

For an image, a label might identify buildings or shops. In case of an audio, a label might associate the noise/ sound with some part of the language, like words or phrases. Understanding a ‘label’ also provides a good understanding of ‘what is data labeling.’

Computer vision

Visual data is much richer than textual data. Unfortunately, software coding has no place for visual cues to be given or received. Through AI, we are keen to teach computers to see and understand visual data in the same manner that humans do.

Computer vision is a broad term used to refer to the ingestion of visual data by a computer and its interpretation.

Training data

Typically, a large number of labels put together will constitute training data. The collected information that enables a software program or computer to make sense out of raw or unstructured data.

Humans in the loop

This is a term used to refer to the process through which human beings are allowed to add inputs into the model and provide insights that purely statistical data may not have been able to provide.

While one could argue that the training data used should have been of adequate quality and quantity that such feedback loops should not have been needed, in reality building training data is a tedious and expensive task. Therefore, for some applications that may not present a risk of injury or death, limited data-sets with a human-in-the-loop feedback cycle are used to refine models.

Ground truth

Ground truth refers to the reality check. The point where ‘the rubber meets the road.’ Often used at the initial stages after the AI model has been trained and unleashed on an unsuspecting world. At the initial stages it is important to keep track of its results and ensure that the results delivered are in line with human expectations.

With hands-on experience of over 20 years, the leadership team of oWorkers is well aware of the answer to the ‘what is data labeling’ question and well placed to provide guidance on data labelling projects to all its projects and team members. With support for 22 languages, a GDPR compliant business and operating from ISO certified facilities, oWorkers offers  a compelling proposition for data labelling services.

 

Labeling common data types

Text

Creating structured text and having a computer interpret it and act on the interpretation is a science mastered by humans and computers many decades back. That is called software programming.

When we talk about text in the context of AI, the reference is to unstructured text. How do we get a computer to understand and interpret text that was not created for the specific purpose of being interpreted by the computer. A computer would need training to even comprehend the phrase ‘what is data labeling.’

There are concerns these days about the destructive force that some of the social media platforms can be when they propagate falsehoods and hatefulness. A small, tiny, pathetic human being might enjoy his moment in the sun through such a message, but the cost and implication for society could be high. AI models trained to read and interpret text can be used to head off the potential damage by suppressing or deleting such messages and identifying and apprehending the perpetrators. 

Labeling textual data is also useful in applications that use Natural Language Processing (NLP) like Voice Assistants and Speech Recognition. Audio converted to text through speech recognition technologies and used as training data-sets can also provide a variety of applications. Chatbots that are increasingly becoming popular for responding to customer queries have been trained with labeled textual data.

Images

Making sense of unstructured data being the key objective of AO models, working with images has become an increasingly important requirement. Videos are also often handled as a sequence of images in rapid succession.

What is an image for a computer? It is an image. That is all. At best, in the digital world, a computer may be able to identify an image as a collection of pixels.

Labeling an image is the process of making the image, or certain parts of it, meaningful to a computer, so that it can create associations and patterns out of it.

A hundred years back estimating the level of summer ice on the North Pole may have been a manual exercise done by accessing each floe and measuring it. Today, it can be done with the help of AI models. By training the model to recognize sea ice by feeding it millions of images where the ‘target’ is made distinguishable to the computer by its features being called out, it becomes capable of identifying sea ice on an image where it has not been marked, thus doing in an instant what it took probably hundreds of mandays to achieve earlier.

Some common techniques for labelling images:

Semantic Segmentation – Pixel level labelling, used for more precise recognition of objects in a single class to differentiate them from each other.

2D Bounding Box – To facilitate the detection of certain objects, rectangular, close-fitting boxes are drawn around the target objects.

Polygonal Annotation – Similar to a 2D Bounding Box, but the figure drawn around the object to be identified is not rectangular, but polygonal instead.

Cuboid Annotation – Also called 3D cuboid annotation, cuboidal annotation is used where the third dimension of depth is relevant for the AI model. A case in point could be autonomous vehicles here the model needs to know how long it might take for a truck to pass

Audio

Software programming has developed along textual pathways, with programs coded in textual formats being read and understood by machines. Audio remained a ‘bridge too far’ for computers. But that is changing with AI. With the creation of training data sets created to train AI models, this field is developing rapidly along with developments in what is known as NLP or Natural Language Processing.

The most obvious use of audio capability in AI appears to be to convert speech to text. Being the most precise method of communication, with a finite set of characters and words and symbols in each language, text is the preferred language of communication for computer systems. Therefore, the path to any operation on an audio file lies through text. If one needs to search for a certain string in an audio file, it would be searched as a text string and not as an audio string. If it is searched as an audio string, the computer, with the use of AI, will perhaps convert it to a text string and match it with the original audio file which it is searching against, which presumably is also stored as a text file. Development of AI models has greatly speeded up the growth of NLP.

Examples of audio capability application:

  • Conversion of speech to text, automating transcription
  • Voice response units for customer service
  • Emotion and sentiment identification and management of potential danger signals

Video

With its combination of visual and audio content, video remains the richest and densest media that is handled by AI models. As discussed elsewhere, videos are generally handled as a sequence of images, with the additional element of changes taking place in the identified variables from one frame to the next further enriching the information contained.

Autonomous vehicles, security surveillance and virtual examination proctoring are some of the applications of AI that is trained through video labelling.

In Conclusion

oWorkers excels in its chosen area of specialization, having consistently been identified as one of the top three providers of data services in the world. Its rankings on Glassdoor have always been above 4.6 out of a possible 5. Though not specific to data labelling, our spread of centers also provides clients the capability of contingency planning, with capacity being made available in more than one location for the same service. Your work enables us to bring a few more people from disadvantaged backgrounds into the digital economy and change not only their own, but lives of their families as well.

We know the answer to ‘what is data labeling’ as well as ‘how it can be done efficiently,’ ‘what are the right tools to be used’ and ‘how to create value for client AI models.’

Business Process Optimization: How to Improve Workflows

Business Process Optimization: How to Improve Workflows

Business Process Optimization: How to Improve Workflows

A transformation is afoot in the world of Business Process Outsourcing (BPO).

A formalized BPO industry took shape many decades back with the primary objectives of saving labour cost while performing repetitive tasks, locating larger labor pools for outsourced tasks, creating efficiency and controls for the outsourced, mostly repetitive tasks.

As we probably know, in a competitive world, which is where businesses function, a business is never satisfied. It needs to keep doing more and more and more. It needs to find ways of enhancing revenues. It needs to find ways of reducing cost. It needs to keep finding competitive advantages to keep at bay pretenders snapping at its heels. It needs to find value propositions that enable it to stay relevant in the eyes of its client segment.

Business is littered with the corpses of corporations once considered unassailable in their chosen areas of operation but fell by the wayside as they were unable to effectively negotiate the changes demanded by the sheer passage of time, emerging technologies and customer preferences. Kodak and Nokia readily come to mind though no doubt there are many others.

BPO is no different. Like any business, it needs to stay relevant and competitive. It has had its share of challenges and has been reinventing itself over and over again. It has also brought into common consciousness processes and technologies that were either considered relevant only for manufacturing, or too academic for business applications.

One of the most significant contributions of BPOs has been towards business process optimization. With consistent performance leading to greater trust, and with the growth of consumer franchises greater and greater volumes being processed by BPO partners, they are now taking the lead in defining how business processes should be run for best outcomes.

The tail seems to be wagging the dog but the dog is happy.

So much so that NASSCOM, the industry association for IT and BPO in India, has even been suggesting that the industry should be referred to as Business Process Management (BPM) as it now goes beyond merely providing a data outsourcing solution and actively provides solutions for better management of business processes.

oWorkers has been supporting clients in its chosen areas of data services for over eight years. We have helped clients define, stabilize processes and even implement updated ones to better achieve business goals. We are GDPR compliant and ISO (27001:2013 & 9001:2015) certified.

 

What is business process optimization?

In layperson terms, it can be used to refer to any activity that leads to an improvement in one or more business processes.

Businesses being entities driven by the profit motive, everything inside them gets measured in monetary terms. Eventually, all improvement has to trickle down to the bottomline.

Revenue and Cost being the two main components of the bottomline, or profit, improvement should result either in doing the same thing at a lower cost or doing the same thing and realizing higher revenues. In general, though, improvement and optimization focus on the cost side by working on the various processes through which delivery of the company’s products and services is effected. On the revenue side, while optimization could have applications everywhere, in general, marketing and promotion strategies are leveraged to yield better, or different, results from what have hitherto been experienced.

The above notwithstanding, as the trickle-down to the bottomline effect of many changes might not be possible to isolate, businesses attempt to find surrogate variables through which improvement can be implemented and the impact measured. Some examples of areas which might be suitable for improvements and where it might be possible to measure the outcome, could be:

  • Customer satisfaction score
  • Customer response time
  • Transaction wait time in queue
  • Training duration

There is really no end to possible improvement areas. It depends to a great extent on the nature of the business. Also, it does not necessarily have to be a customer impacting area like transaction wait time in queue, which impacts the customer directly. Even internal processes like training, if we are able to enhance, will eventually, at a holistic level, impact all areas, including customers. For example, if the provider is able to reduce its training duration, it could lead to a cost saving with the possibility of the savings being shared with clients.

oWorkers has consistently been ranked among the top three providers of data based BPO services in the world. Our hands-on leadership team, with over twenty years of experience in the industry, leads our projects and improvement initiatives designed to add value to clients as well as our internal processes, using the latest techniques and processes.

 

The need for business process optimization

Let us look at a few examples of human endeavor from sport, often considered to be the pinnacle of physical human striving.

Sir Roger Bannister ran the mile, a distance of 1600 metres, in a time of under 4 minutes in May, 1954. The first human to do so. Many had tried earlier and failed. It was, then, considered the ultimate athletic achievement, one that could not be repeated.

By the eighties, just one generation later, Steve Ovett and Sebastian Coe were already running the mile in under 3 minutes 50 seconds.

Do you know the current record? It is 3 minutes 43 seconds or thereabouts. 17 seconds shaved off a time once considered impossible. In just two generations.

Take tennis.

According to data collected over the years from Grand Slam events, the average first service speed was under 170 kilometres per hour in the early nineties. Measured in 2008, the first serve speed had increased to over 180 kilometres per hour. Armed with better physical training, and improved equipment, youngsters are serving faster and faster. Of the twenty fastest serves recorded, apparently only one belongs to the period before 2000.

Wherever you look, swimming, mountain climbing, marathon running, sprinting, continuous improvement is evident.

Business is not immune to this facet of human endeavour.

Man’s effort at continuous improvement is as applicable to business as any other facet of life.

And it makes sense too.

After all, in a competitive world, everyone is striving. To do more. Faster. Higher. Better.

If you don’t make the same effort, your business will run the risk of obsolescence and fading away as clients keep looking for creating value for their own businesses.

Hence, continuous improvement is not a choice. It is a survival strategy.

With three centers across the most favored BPO destinations in the world, oWorkers provides services in over 22 languages commonly spoken across the world. With us as a partner, clients can focus on their core business and seek to bring about transformational change with the support of our teams who are trained on continuous improvement methodologies.

 

The Process

There is no standard template for doing something better. Change can come from anywhere. In the context of a business, any business process optimization is likely to follow the broad sequence of steps outlined below:

Identification of need

Well begun is half done, they say. No different for business. However, this is also the most difficult stage. How does one glance across the shopfloor and identify the one process that is most likely in need of some betterment? After all, the business has been using the same processes for some time. One cannot randomly pick up one for special treatment. The right start is important in getting the right results. Here are some methods companies have used for this identification:

Competitor benchmarking – This is a common activity for many businesses, at least businesses with scale. Periodically it makes an effort at comparing itself with its closest competitors in an effort to do just this, identifying areas where the competitor is performing better with the aim of understanding the reason so that it can play catch-up.

Are they employing fewer people for the same output?

Are they able to fulfil orders two days faster than your business?

Such variances, once identified, become the starting point of your efforts at business process optimization.

Trend analysis – Businesses, again, at least ones with scale, also make a periodic effort at establishing trends in their own performance over several periods of measurement.

Transport cost has gone from 6% of Direct Cost to 10%. Is there a problem?

We recruited twice the number of people we hired last year. But our revenue is the same. What is the issue?

Such variances, again, provide leads into the areas which could benefit with some deep dives and detailed analysis.

Common sense – By virtue of being in a business for long, leadership and management teams develop a sixth sense about it. They may not be able to always back it up with data at the start, but they can be trusted to have an inkling about the trouble spots in their processing facility. Very often these provide a quick start to an investigation which often leads to some change being implemented.

Initial study

At the point where the initial ideas are being put together, the amount of information is limited and may only be available at a reasonably high level. The discussion at that stage is based on estimates, guesswork, hunches and possibilities.

That is as good a start as one can get, as it is impossible to have all information available upfront.

Based on the considered opinion of people involved in the discussion, the area needing work is identified which is the starting point of the next phase, that of initial information collection and study. This will serve to validate the initial hypotheses and will determine whether to go deeper into this particular area or drop it and look at other possibilities. The team may need to go through this phase a couple of time before the area is identified and agreed by all stakeholders.

Creating a project plan

From this point onwards there is no looking back. Quite often the initiative is launched in the form of a project with defined ownership and participation and in a format the success of failure of which could be measured.

This phase serves to define critical parameters like:

  • What is the objective; what is the initiative trying to achieve
  • Process or processes in scope and, by exclusion, the ones not in scope
  • Resources available to the project team, including senior level sponsors
  • Measurement method, including an external to the project resource for doing the measurement

Measure

As organizations seek to conduct their activities in a professional and transparent manner, measurement becomes important. This avoids later conflicts when credit for improvements is being sought and either rewarded or refuted. With clear measurements, the organization is better placed to know the real results.

Analyse

Once data becomes available, the process of analysing it begins. It is quite possible that while analyzing we find that data is deficient in some aspects and hence a few cycles of data collection, or measurement, may be interspersed with the analysis phase. It is also possible that additional data is required to reach meaningful conclusions. Either ways, the Measure and Analyze phases are likely to run in parallel for a bit.

The Analyze phase should result in bringing out areas which are likely to benefit based on which the project team will agree on specific actions that are likely to result in business process optimization In the identified areas. Again, no clear process for arriving at the actions is available. A lot of t is based on discussions. There are some tools that are available that some teams find useful, like Fishbone Analysis, Pareto Analysis and old-fashioned Brainstorming.

Improve

The I for Improve is sometimes also used to denote Implementation.

The rubber now hits the road. The theoretical work that was being done by collecting data, analyzing it and making recommendations, now needs to be introduced into the ‘live’ system. After all, the proof of the pudding is in the eating.

This can also be seen as a ‘test’ run that is supported by the might of the implementation team that is available to step in if things don’t go as planned.

Control

One of the criticisms improvement initiatives in BPOs have faced is that while a project is in progress and the project team in place, progress is good. In most cases the project results in successful implementation of change. However, once the implementation in a Business As Usual (BAU) manner is done and it becomes a part of normal work, improvements achieved often slide back.

The other criticism is that while improving one parameter that was the goal of the project, some other parameters that were not being monitored, suffer.

The Control phase is meant to ensure that business process optimization achieved is for good and the situation does not revert back to where it had started from. In addition, all other relevant parameters stay either where they were or improve. In other words, the business does not lose on the roundabouts what it gained on the swings.

Note: From the third step onwards, this methodology merges with a methodology known as DMAIC, that stands for Define, Measure, Analyse, Improve and Control.  DMAIC is a popular methodology commonly used either as a standalone or as a part of other methodologies like Lean and Six Sigma, to achieve lasting change.

The Quality team of oWorkers is conversant with a variety of quality systems that not only include Six Sigma, Lean and DMAIC, but also with ISO, Kaizen, COPC and TQM (Total Quality Management). They are constantly looking at possibilities of adding value through business process improvement, releasing value for oWorkers as well as clients.

 

In Conclusion

With oWorkers, you get a partner who is an extended part of your organization, looking to bring about positive change both for you as well as for oWorkers.

Having strategically decided to work with employed staff and not freelancers, we take responsibility for their development and training, including training on quality systems to select staff. We are a preferred employer in all the locations we operate from, which gives us the flexibility of offering peaks in staffing to cater to seasonal or other volume spikes, of upto a hundred people in 48 hours.  

We stay committed to bringing about positive change in all communities we work with. The work you outsource to oWorkers will enable us to introduce a few more people to the digital work, hopefully bringing about fundamental change to them and their families.

What is Business Process Outsourcing and How Does It Work

What is Business Process Outsourcing and How Does It Work

What is Business Process Outsourcing and How Does It Work

 

Three fairly common words of the English language come together to form a term that has added enormous value to a wide variety of industries and businesses around the world and continues to do so, evolving and mutating to keep pace with changing times, technologies and expectations. The term being referred to is: Business Process Outsourcing.

Another term that has gained currency in the last few years is BPM, which stands for Business Process Management. BPM is considered by some as being a wider term that encompasses managing a process in the most effective way, whether outsourced or not.

 

Business processes outsourcing: wide range of services

We know that supermarket stocks essentials items for customers to buy for their daily needs, and on a day-to-day basis, it ensures that its racks are stacked, shelves labelled correctly, inventories evaluated and orders placed.

We know that a restaurant provides a predictable environment for patrons to dine in, and on a day-to-day basis, makes sure there is adequate raw material, the place is clean, and food and drinks prepared as per customer requirements, and served.

We know that a bank takes deposits, grants loans, transfers money, provides financial advice and responds to customer queries on a day-to-day basis.

We know an insurance company assesses event risk, issues policies, collects premium payments and adjudicates on claims made by policyholders, on a day-to-day basis.

How about a BPO? What does it do on a day-to-day basis?

The amazing thing is that it could be doing any, or all, of the business processes listed above, and many more.

For a telecommunications business, it could be doing provisioning of new orders. For a hospital, it could be doing transcription of oral medical prescriptions. For a bank, it could be attempting to collect overdue loan payments from defaulting customers. For an insurance company, it could be doing adjudication of amounts payable on customer claims. For a car manufacturer, it could be handling customer service calls.

Unbelievable, but true.

Business Processes Outsourcing is a fast-moving, flexible, business, populated by a versatile group of human resources, that is adept at taking the shape of any business or service that it chooses to work for and adding value to the host or client business by doing it more efficiently and effectively.

 

Adding value to other businesses

Sporadic voices have occasionally been raised against the industry, especially where the work is done in another country, on flimsy grounds like ‘taking away jobs.’

We know that outsourcing is a reality in today’s connected world. We don’t grow the food we eat. Others grow it because they can do it better, and we buy it and feed ourselves. A supermarket does not manufacture the cash registers it uses at the checkout counter. It buys them from another company that has the knowledge and skills to do it better. The supermarket buys them and uses them, while keeping focus on their own business. These are examples of outsourcing, which can also be viewed as mutual dependence. Doing the core work ourselves and relying on others where they can do it better than us.

Business processes outsourcing is no different.

Like any business operating under the framework of a free market, it continuously tries to maximise its profits and shareholder value, by taking on processing activities which can be better performed by them. This could be for a variety of reasons like bulk volume, better tools and technology or greater experience. By doing certain processes more efficiently and effectively than another business can, they add value to other businesses.

 

Types of BPO

While they could, theoretically, do anything, as we have just seen, each company chooses the areas in which it would like to operate. It is a competitive world, after all. There are many other organisations that are similar, each trying to outdo the other in providing better value to its clients, winning more business, and earning greater profits for their owners and shareholders.

Knowing what you are good at by typifying your organization within certain boundaries could be beneficial in representing your organization in a sharper and clearer profile to the external world. It will also enable you to focus on business that answers to your areas of strength, instead of running after each new contract that comes up for bidding.

From the perspective of clients as well, it would be difficult to begin their search for a supplier with, say, a million BPO companies in the world, assuming all offer the full menu. It will become an endless evaluation exercise for outsourcing. If the client is a telco and wishes to outsource line order provisioning, it might be a more efficient process for them to limit their evaluation to companies that project themselves as specialists in that area or industry.

There are many ways for Business Process Outsourcing companies to identify themselves. Here are some common parameters around which this is done:

Nature of work done

BPOs can be classified on the basis of the nature of work handled by them.

If the work done by them is only or primarily in the area of providing customer servicing, like answering billing queries for a telco, they could classify themselves as specialists in providing customer service.

If the work done by them is only or primarily in the area of providing technical support to customers for resolving their hardware and software issues, they could classify themselves as specialists in providing technical support.

If the work done by them is only or primarily in the area of doing payroll processing for clients, they could classify themselves as specialists in payroll processing.

This list is not finite. The specialisation could be in HRO (Human Resources Outsourcing), or LPO (Legal Process Outsourcing), or Medical transcription, or Advertising copywriting, or E-publishing, or anything else.

oWorkers provides best-in-class services for data entry, annotation and content moderation services.

Channel of service

Channels through which services are delivered is another common classification.

If the outsourced work is being done only or primarily through Voice, it could be classified as a Voice specialist. A BPO specializing in Voice is also commonly referred to as a Contact Centre or Call Centre.

Voice services could be further broken down into Inbound Voice Services and Outbound Voice Services.

If the work is being done primarily on Email, it could be classified as an Email specialist.

If the work is primarily backoffice processing, it could be classified as a backoffice BPO.

oWorkers, in the eight years of its existence, has focused its efforts on backoffice data related work as its core and continued to build expertise in it. Within backoffice, we offer data entry, data moderation and annotation services.

Industries supported

This is a fairly obvious classification, based on the type of industry for which work is done.

If the work being done is only or mainly for Pharmaceutical companies, it could be considered as a Pharma specialist.

If all or most of the work being done is for companies that offer Insurance, it could be considered as an Insurance specialist.

If the work being done is primarily for a Telecom business, it could be a Telecom-specific supplier.

There could be as many types of service-providers as industries using outsourced business process services.

This type of classification can also be called classification based on Verticals.

Services of oWorkers are offered to a wide spectrum of companies across industries including several global unicorn marketplaces. In addition, 85% of our clients are technology companies. 

Location

While business processes outsourcing may have started as local initiatives, with processing work being done in less expensive parts of the same town, with the explosion of communications and internet technology, it has rapidly expanded around the world. Today, work could be outsourced from anywhere to anywhere in the world; in other words, for many outsourced processes, the location of the outsourcer and service provider do not have much relevance; either could be anywhere in the world.

Each individual and organization, however, is subject to the legal framework of the country they operate out of. If the client and supplier are in two different countries, there is a possibility that applicable laws could differ.

A BPO could be classified on the basis of nationality of its clients being the same country or a different one. If the work being done is for a client in the same country, we could call it domestic work and if it mainly, or only does domestic work, it could be called a domestic services provider.

If the work being done is for a different country, we could classify it as ‘international’ which would also create a related classification of ‘export’ as the revenues from the business arise overseas and are remitted to the country of the vendor for work done. These qualify as export revenues which are important for many developing nations and often attract government incentives. Another term used for ‘international’ is ‘offshore’ which signifies that the origin of the work is from outside the ‘shores’ of the country.

A domestic BPO is also often called an onshore supplier to signify that origination of the work is from within the ‘shores’ (boundaries) of the country where it is being serviced from.

With three centers in three geographies recognized as key locations of the industry, oWorkers would be considered to be primarily an export services vendor as most of its clients are located in geographies other than where they do the work from.

Demographics

The industry is recognized for its ability to create jobs in communities that face challenges of development. As a result, it often gets support from governments for setting up centers in such underserved locations.

Thus, delivery units could be identified on the basis of the development index of the town or city they are based in. This is especially true for large delivery provider nations like India, which could have significant variations between locations. It might be possible to classify locations within India as Tier 1, Tier 2 and Tier 3 locations where Tier 1 is the most developed, has access to quality resources and infrastructure and likely to be the most expensive for clients, as a result.

Another method of classification used is urban and rural, where a rural center is likely to be eligible for government benefits in return for contribution to the employment effort in that location.

The two scales can also be combined, with rural sitting somewhere after Tier 3.

oWorkers straddles the development index with its centers in Plovdiv, Bulgaria and Cairo, Egypt which could be considered as Tier 1 centers with reliable infrastructure and availability of well-educated resources, and Antananarivo in Madagascar which requires greater effort in training for resources as well as investments in infrastructure like backup power generation capacity.

Distance from source

This is where some popular terms like nearshore and farshore fit in.

If the work is being done in another country, the term used to define it is offshore.

If the work is being done in another country, but in a location that is somewhat contiguous, it could be referred to as being nearshore.

If the work is being done in another country, in a distant location, it could be referred to as farshore.

If the work is being done in the same country, it is referred to as sameshore. This is also referred to as onshore.

The above notwithstanding, it is not merely distance that determines this classification, else it would be in terms of miles or kilometres between the source and delivery units.

A delivery unit located in San Antonio in Texas for a business located in New York is a greater distance than a delivery unit based in Krakow, Poland, for a business located in Frankfurt, Germany. However, as it is in the same country, we would call it ‘sameshore’ whereas Krakow, in relation to Frankfurt, would be called ‘nearshore’.

oWorkers provides business process outsourcing services to its clients in the US and nearshore services to its clients in Westerm Europe.

Ownership

Ownership of the delivery unit is another method of classification.

It is a binary classification where the delivery unit, if owned by the company seeking the service, but identified as an independent unit for the purpose of specialization, differentiating the working terms and conditions and clear responsibility identification, is known as a captive. A term that has gained acceptance more recently for the same provider set is that of Global Inhouse Center (GIC).

On the other hand, if the company seeking the service is not the owner, it is known as a third-party vendor.

oWorkers is a third-party vendor of data related services to clients around the globe in over 22 languages.

 

Choosing a partner for business process outsourcing

oWorkers has consistently delivered accuracy in excess of 99% despite the difference in measurement scales across clients in over eight years of increasingly complex engagements across data entry, content moderation and annotation projects. Its delivery efforts are watched over by an independent Internal Quality team that reports directly to senior management.

Having a leadership team that has over 20 years hands-on experience in the business and a sound financial position gives oWorkers the ability to invest in the business. It is able to leverage the latest technologies with its partnerships across different partners and enable clients to benefit from them.

Operating from the Eurozone, GDPR compliance is a necessity. In addition, oWorkers is ISO (27001:2013 & 9001:2015) certified.

Our relationship with local communities rewards us with a steady stream of interested applicants that keeps our hiring costs as well as attrition low. It also enables us to cater to peaks of upto 100 resources in 48 hours. We are Covid-19 ready and our employees are able to seamlessly operate from home when required.

oWorkers has been ranked amongst the top 3 data entry companies in the world. Our pricing is transparent and we can offer clients a choice of per unit of time pricing or per unit of output pricing. Several clients have reported savings of upto 80%.

oWorkers operates locally registered entities in all its delivery locations. It pays local taxes as well as social taxes for its employees. The work you outsource to us enables us to hire a few more disadvantaged people and help them become a part of the global digital workforce. 

Outsourcing in Eastern Europe countries comparison

OUTSOURCING IN EASTERN EUROPE

What is the best country to outsource data processing or IT in Eastern Europe ?

Outsourcing in Eastern Europe offers great advantages like :

  • Real time collaboration for Europe
  • Very Highly skilled people
  • Cost savings
  • Multi Languages availability
  • Cultural affinity

But all the countries in Eastern Europe don’t offer the same advantages in term of cost, availability of talents, business environment, GDPR compliancy  so we choose the 10 more popular ones for their outsourcing capabilities and we compare them.

Different outsourcing studies did a great job but in this post we want to point out some details to show real differences according to our experience.

We make a full comparison of those countries known to be great nearshore outsourcing destinations for Europe on different criteria. We took different valid sources of informations and the verdict is that the winner is BULGARIA in term of costs, talents availability & skills , business environment.

THE FIRST 5 COUNTRIES

COUNTRIES
BULGARIA
ROMANIA
ALBANIA
POLAND
HUNGARY
Capital
Sofia
Bucharest
Tirana
Warsaw
Budapest
INSIDE EU (GDPR)
YES
YES
NO
YES
YES
PEOPLE SKILLS & AVAILABILITY / BUSINESS ENVIRONMENT
Main city population
1,3 M
1,9 M
0,6 M
1,7 M
1,7 M
Country population
7 M
19 M
2,7 M
38 M
9,9 M
English Speaking
* * * * *
* * * * *
* * * *
* * * * *
* * * *
Multilingual European Languages capability
* * * * *
* * * * *
* * * *
* * * * *
* * * *
Students in computer science per year
6000
5800
3200
8000
7400
BUSINESS ENVIRONMENT
5 / 5
5 / 5
2 / 5
5 / 5
4 / 5
COST
Net salary level on base 100 (Bulgaria)
100
115
90
131
127
Employer & Employee charges
31%
32%
25%
40%
46%
Infrastructure (SQM/month Prime)
12 EUR
19 EUR
10 EUR
15 EUR
21 EUR
RANKS
A.T. KEARNEY 2016 global services location index Eastern Europe
2
3
not listed
1
8
Tholons Top outsourcing 2015 Eastern Europe :
7
4
not listed
3
2
Cushman & wakefield BPO index rank 2015 : Eastern Europe
1
2
not listed
6
3
Colliers international outsourcing city rank 2015
3
4
not listed
7
5

THE NEXT 5 ONE

COUNTRIES
CZECH
CROATIA
SLOVAKIA
LITHUANIA
UKRAINE
Capital
Prague
Zagreb
Bratislava
Vilnius
Kiev
INSIDE EU
YES
YES
YES
YES
NO
PEOPLE SKILLS & AVAILABILITY / BUSINESS ENVIRONMENT
Main city population
1,2 M
0,8 M
0,4 M
0,5 M
2,8 M
Country population
10,5 M
4,2 M
5,4 M
2,9 M
45 M
English Speaking
* * * * *
* * * * *
* * * *
* * * *
* * *
Multilingual European Languages capability
* * *
* * *
* * *
* * *
* * *
Students in computer science per year
9000
8500
8400
5500
Inc
BUSINESS ENVIRONMENT
5 / 5
5 / 5
5 / 5
5 / 5
3 / 5
COST
Net salary level on base 100 (Bulgaria)
145
120
125
110
108
Employer & Employee charges
33%
37%
48%
39%
47%
Infrastructure (SQM/month Prime)
20 EUR
14 EUR
15 EUR
14 EUR
17 EUR
RANKS
A.T. KEARNEY 2016 global services location index Eastern Europe
6
7
5
Tholons Top outsourcing 2015 Eastern Europe :
1
5
Cushman & wakefield BPO index rank 2015 : Eastern Europe
5
4
Colliers international outsourcing city rank 2015
5
2

We hope than you find
those informations helpful

Of course there is always exceptions, some offshore vendors have great capabilities but we are speaking here about the average situation which happens in most of the time. Hope you envoy and find this post helpful, if you like it share it Here the sources than we compiled : We have been listed in the Top 3 Data Entry Companies in the world.

Nearshoring versus Offshoring (nearshore outsourcing vs offshore outsourcing)

Nearshoring versus offshoring

Nearshore outsourcing versus offshore outsourcing, what is the best ? in which cases ?

When it’s time to choose an outsourcing destination many companies confront the following dilemma first, before choosing the country and the vendor : ” Do we have to choose an offshore or a nearshore vendor” ?

To the newbies to the outsourcing word an offshore outsourcing (offshoring) destination is when the operations are done from a long distance and “time zone difference” country let say the Philippines, Vietnam or India for an European client versus a nearshore outsourcing

(near-shoring) destination when the distance & time zone are quite similar (let say Eastern Europe countries and even Egypt for Europe).

Making this choice counts already for 40 % of the success of the operations to our opinion (and 10 % the country, 30 % the vendor, 20 % the client) . Some type of projects are suitable for offshore and some are not.

Below the synthesis.

We had been doing outsourcing operations since more than 10  years, We managed operations in offshore and nearshore destinations, so we can tell the difference easily.

Below we explain for European companies and some North American & Canadian companies (East coast) who want to do an outsourcing operation, the difference between nearshore Europe with country like Bulgaria and Egypt & offshore (South Asia/India vendors). Our BPO services company offer both. 

NEARSHORING VERSUS OFFSHORING TABLE COMPARISON

Criteria
Nearshoring Nearshore outsourcing
Offshoring Offshore outsourcing
Easy access to the center
Yes 2-3 hours flight
No 10-15 hours flight
Real time collaboration
Europe : YES All day long
North america & Canada (east cost) : YES
Half day Morning 8AM to 3 PM
Possible with “night shift” for the employees.
But In most cases :
– Experienced good talents don’t want to work at night cause they have full of choice to work day time
– Quality & assiduity are problematic.
Night operations “can be” ok for operations with VERY strict processes to follow, examples :
– Call operations – Data typing operations
Languages
Fluent English & Multi languages capabilities in Eastern Europe English, latin languages, eastern european languages..
– English based or One language based in most of the case.
– English level can be very awful (example Vietnam)
University level
Similar with Western word
Very Different
Cultural affinity
Very similar
Very different : In most cases customers have to adapt their processes to avoid cultural incompatibility.
Project security
Very high : brand protection, IP protection, data laws and EU regulation…
Very Low
Cost
Normally the “hourly rate » is more expensive (about 30 % to 50 % depending which country you compare) but you have to take in account :

– The price have to be aligned with :
– The speed
– The security
– The comprehension of the project (specifications + the big picture)
– The overall quality of the deliveries that are in most cases incomparable
Qualitative offshore vendors have rates very similar than the one in Eastern Europe (speaking about a 15 to 20% difference)

Very Cheap vendors in offshore location means :
– Poor quality processes to None processes.
– Very few customers
– No experienced project managers
– Poor infrastructure
– Poor connectivity
Best when
– You have to collaborate with your team in real time
– You need multilingual staff
– You need cultural affinity with your staff
– You don’t really need strong processes
– This is the first time your company want to outsource outside
– You don’t need to collaborate in real time
– You don’t need multilingual staff or even non really “fluent” english staff
– You can handle cultural incompatibility
– YOU HAVE VERY STRONG PROCESSES TO FOLLOW
– You have « already » experiences with outsourcing
TYPE OF OPERATIONS
– Multilingual & complex call or DATA processing operations
– Complex IT developments or real time collaboration needs
– Complex BPO and KPO operations
– 24*7 basic (receptionist) call operations in english
– Non complex english Data typing
– Coding without any collaboration (onshore specifications)
– English & basic content writing

Of course there is always exceptions, some offshore vendors have great capabilities but we are speaking here about the average situation which happens in most of the time. We are always open to comments and questions.

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