Is cheap outsourcing to the Philippines good for business?

Cost is one of the primary reasons why companies are outsourcing to the Philippines for business process solutions. But is cheap outsourcing really the way to go? Cheap outsourcing may seem like a good opportunity to grab, but in reality you may be compromising quality.

Outsourcing costs in the Philippines

According to global executive search firm Sterling Hoffman, one of the top reasons offshore project outsourcing fails is that many companies focus too much on costs when selecting an offshore provider. Accordingly, they should also assess the provider’s staff, processes, and technology.

As appealing as it may seem, cheap outsourcing is not always the best option for companies. In fact, it may even lead to disastrous results, especially when the service provider lacks the required expertise, prove to be inefficient, or when it cuts corners due to budget constraints.

The same goes for outsourcing to the Philippines. When you bargain shop for the cheapest outsourcing services, chances are you’ll end up with a provincial center with substandard or outdated infrastructure and equipment. You may also end up in a location with insufficient key talents, particularly college graduates.

Indeed, it’s best to shell out more to get better quality services. Offshore providers with higher-cost services can deliver superior results compared to those with cheaply priced offerings. Their employees are usually college graduates from a wide range of courses, so you can hire real specialists for your projects.

While you definitely need to shy away from the lure of cheap rates, you also don’t need to get the most expensive ones. You might need to look around for multiple providers before finding one with a fair price and the right fit for your business.

Price of services is still an important factor when outsourcing to the Philippines, but the competency of the provider should be the priority. Additionally, you should also take into account other values that the provider can offer aside from the initial low rates, such as reduced operational expenses and improved quality and processes.