The Philippines (PH) is quickly becoming an outsourcing hub for the US and EU. Here at Plattr, we have over 150 outsourced staff in the PH. We are often consulting both clients and partners alike on the best practices for outsourcing, and how to avoid the big mistakes that most companies make.
Outsourcing To The Philippines: What You Need To Know
The country has gained a favorable reputation when it comes to providing outsourcing services. Like any other business venture, it has its pros and cons. If you’re considering outsourcing to the PH, here are a few tips to keep in mind before jumping in.
1. Outsourcing isn’t Just for Customer Service
It’s a common misconception that you can only outsource CS departments in the PH. Sure, it’s one of the BPO capitals of the world, but there is way more talent in the PH than people might think. At Plattr™, we have media buyers, complete social media managers, community builders, and that’s just scraping the surface.
It all starts with the right people you hire. That’s a whole other article in its own right. Read about our hiring practices in the Philippines here so you can start on the right foot.
2. Holidays in the Philippines
There are a lot of holidays in the PH, and oftentimes they are announced by the government with very little notice.
There are legal non-working holidays, special non-working holidays and government-announced holidays. So, if you’re planning to outsource in the Philippines, make sure to keep in this mind. Set expectations with your employees which holidays to celebrate, United States (US) or the Philippines (PH)?
To plan in advance for any surprise holiday announcements, set limitations or conditions for these inevitable occurrences. If you have established a business entity in the PH or plan to, these holidays require double hourly pay. If you’re like us and will utilize contractors exclusively, you don’t have to pay double, but it’s important to establish policies for these holidays.
Our policy is simple: Make up the time, and finish your work when its due. We have contractors who work more than 8 hours a day to plan for an upcoming holiday. We also have folks who will take the holiday and make it up on the weekend. The important point is: to make sure that their preferences are communicated proactively so you know what’s going on. That’s the policy: communicate proactively.
3. Blackouts, Brownouts, and Internet Connectivity Issues
The PH is a lovely place, but it’s no secret that it is a developing country. The infrastructure for power and internet is faulty and oftentimes unreliable.
Another wrench to think about is the geographical nature of the Philippines. Expect category 5 typhoons wiping out the electricity and internet for days at a time. It’s a less-than-ideal situation, but with the proper policies in place, your company can be prepared with little delays in workload.
First, establish a communication system. This is typically done by phone in case the internet is out. Have them contact your main operations person in the PH to communicate their situation.
Second, establish deliverables that can be expected. Residential areas are at times the last to come back online. Have them look for cafes or hotspots where they might be able to plug and work.
Third, if there are no options, roll the work to another employee or adjust your timeframes to account for the weekend. It’s not the best solution, but it is, unfortunately, the only one.
Fourth and final, set your makeup expectations. Just as you would expect your outsourced team to proactively communicate, you must also do the same. Proactively set the expectations for making up the work lost while mother nature unleashing its fury.
4. Cultural Differences: Too Polite to a Fault
Filipinos are polite by nature, but most of the time they are so polite that it can be counterproductive.
They tend to be afraid of stepping on toes. Even if there’s a big problem that’s preventing them from accomplishing their best work, they will avoid stepping on toes. Most of the time, they won’t speak up unless the problem has already blown out of proportion or has become unfixable.
To avoid this, be upfront, and remind your PH staff regularly that you have an open door policy, and that you expect everyone to professionally discuss problems. Put this in practice by having a monthly or quarterly meeting about challenges, where everyone at the meeting must discuss a challenge they’re facing.
That being said, the next item is imperative:
5. Cultural Differences: Communication
Filipinos are not as outspoken as Americans. In fact, most of them are quite timid and not used to speaking with executives from the US.
Make sure to let them know and feel that they can talk to you about anything or everything (work-related, or even personal stuff).
In fact, if you are proactive about getting them to spill the beans and get to know them, it’ll make this process smoother and faster. Promoting an open-door policy and actually follow through with it.
Make it your responsibility to ask them or check up on them every now and then. Constant clear communication is one of the keys to a successful outsourcing venture. You can also assign a point of contact who’s gonna hold down the fort for you in the Philippines.
6. Fear of Being Scammed
This one goes for everywhere, not just the Philippines. Identify yourself as a legit contractor or company from the onset.
You can link them to your website and let them know what the company does. Dispel their fears of being scammed by paying them immediately (or on time, and consistently) for the work that they’ve done for you.
You can also refer or direct them to your main operations person in the PH. Having a main contact person in the PH is beneficial to your business – this can help eliminate doubts in you and your company. Knowing that you already have someone working for you in the PH, you are more likely to win the contractor’s trust.
7. Be Generous with Monetary and Specific Verbal Praise
Everyone appreciates praises, not just monetary but with verbal praise and recognition too. Give credit where credit is due.
Employees stay in the company, not only because of the money but mainly because they are happy and they feel appreciated. Be sensitive to your employees’ welfare.
Offer them competitive rates and benefits. The best employees are happy employees. Happy employees are more productive. People, in general, feel happy when they are recognized, especially when they’ve done something they are not expecting recognition for. Although not required, monetary is also much appreciated!
Make sure to compensate your employees properly and give them perks to make them do quality work all the time and stay with the company.
8. Family Oriented
Filipinos are family oriented. You will notice that most of their judgments and decisions will be based around their family.
You will also notice that most of the time they will use their family as an excuse — this may or may not be true (although we always give them the benefit of the doubt).
In the end, make the contract about the WORK. Offer the flexibility of work time, but rigid deadlines. If they can’t make it work once: fine. Everyone has emergencies.
Twice? Use your best judgment here.
Thrice? Whether it’s true or not, the relationship will not work out. So, in the end, it doesn’t even matter if it’s true or a lie. End of the day, the work has suffered enough for you to know that it won’t work out.
Objective separation isn’t a bad thing at all.
9. Employee Experience Equals Employee Rates
If you have a low starting budget, you can still get your work done. The downside is those who are willing to take lower offers usually have little to no experience.
Experienced employees are looking for a more competitive salary or offer and will be comparing rates. Offering a competitive salary will get you a pool of competitive employees, too.
Give an offer that is fair to both of you. You don’t need to go overboard cutting costs because outsourcing already saves you a lot of money. You can also always give incentives to exceptionally well-done work and appraisals based on performance and tenure.
10. Consider Training as an Investment
This is a must. Whether in-person or online training, you have to train your team.
Training will eliminate confusion, will make your team more independent and efficient, and will help their decision-making skills. This will free up your time and energy in the future so you can focus on more important matters of the business.
After every training, ALWAYS provide feedback. Training and feedback go hand in hand especially when you’re outsourcing. Positive and negative feedback are both important.
When giving feedback, make it constructive and objective. It’s not just about giving the feedback but how you deliver it. Here’s a couple of tips to keep in mind:
- Make your feedback timely and specific. The sooner you address the issue the better, so It can be corrected immediately. Be specific when providing feedback, just focus on the issue at hand. Make sure to stick to the facts and what the employee needs to improve on.
- Criticize privately. Being recognized publicly is such a good feeling but I can’t say the same for public scrutiny. When giving constructive feedback, set up a safe place where you can’t be interrupted or worse overheard.
- Use the sandwich method. The rule of thumb for this method is to start off with something positive. This will make your employee feel a little comfortable and at ease. This can help open their minds as well. Sandwich your more negative feedback between two positives.
- Provide suggestions and don’t forget to follow up. Simply providing feedback isn’t enough. Provide possible solutions as well or better yet ask for their solutions. Make sure to follow up. The purpose of training and feedback is to improve your employees’ performance. Find out what’s working or not and then offer solutions again and CELEBRATE SMALL VICTORIES!
Constant, consistent and effective feedback helps increase productivity, improves your employees’ performance, boosts morale and motivates them to do better.
11. Get to Know Your Hiring Sites
There are a lot of job posting platforms in the Philippines that you can find online. Here are a few examples:
You can start by using their free trial service and familiarize yourself with the tool and how to navigate through it.
Each site has their advantages and disadvantages. Some are free and some you have to purchase a subscription to post your job ad. You just gotta choose which one you’re more comfortable with and which one is truly worth your penny.
Don’t forget PayPal too! This is the safest and most preferred mode of payment (for both of you) in the Philippines. Make sure to include this as a requirement when you post your job ad.
The outsourcing process may seem a bit overwhelming because of how much work it takes. It’ll be worth it ten times over in the end. End of the day, it’s about treating your outsource team as you would an in-house team.
Be there for your team, and you’ll find that your outsourced team will always be there for you.