Many companies and small businesses have looked for ways to cut costs while still doing the same, if not more business. The use of offshore labor can look like a very attractive, low cost alternative to hiring someone locally in the United States. Having spent a decade and a half working with offshore contractors I\’ve seen the upside and downside of this practice. Here are some points you should be aware of before you decide if using offshore resources is right for you.

Working in different time zones – Depending on who you contract with, the time difference between you and your employee may literally be night and day. Many larger companies make contractual arrangements to have their contractors work the same shift as they do. When I was working with individuals in Europe or Asia, any questions we had in the afternoon had to wait until the next day to be answered.

Cultural Differences – Some cultural differences are more serious (and much less talked about) than dietary requirements. I had employees who had worked onshore for me for a year and half. After someone started work who was clearly different than the the person we had interviewed over the phone, my team noted that in their country that was a frequent occurrence. They referenced numbers as high as 70 percent of graduating students who had their more experienced or fluent friends do their interviews for them. They could not understand why we saw this as a huge integrity issue.

Language Barriers – Even my most fluent English speaking employees frequently missed the main points of a discussion as I would discover from subsequent conversations. I was surprised how often the technical issues that materialized during the life of our projects were discovered to be caused by miscommunication rather than anything more serious.

Loss of Intellectual Property – Particularly in technical fields, attempting to give design work to offshore resources without a plan to transition the knowledge back in house, puts your business at risk. Lower cost resources working for larger shops frequently change jobs and move on. When they leave, all your historic knowledge and expertise may go with them.

Higher cost than advertised – You get what you pay for. If you want more experienced resources you will pay higher hourly rates to have them. If the price appears to be too good to be true to cover the full range of services you\’ve asked for, it probably is, and you\’ll find gaps that you will need to fill.

I am not suggesting that all offshore contracting is ineffective. But you need to be prepared that you will have to clearly and explicitly state your requirements. Your oversight and involvement will be actively needed. You still may want to supplement your staff with specialized skills that you don\’t want to hire long-term or for which you don\’t want to pay the local rate. Just factor your time into the cost, and if it still comes out favorable, proceed. With caution.

C. J. Mackey is a working mother of three, balancing a full time career while taking an active role in her children’s lives. C. J. has an advanced degree in engineering and twenty plus years experience in making technology decisions for fortune 500 companies.

C. J. Mackey is a working mother of three, balancing a full time career while taking an active role in her children’s lives. C. J. has an advanced degree in engineering and twenty plus years experience in making technology decisions for fortune 500 companies.

Author Bio: C. J. Mackey is a working mother of three, balancing a full time career while taking an active role in her children’s lives. C. J. has an advanced degree in engineering and twenty plus years experience in making technology decisions for fortune 500 companies.

Category: Business Management
Keywords: Outsourcing,job loss,careers