The world of work is changing
In my recent blogs, I’ve discussed how remote work has transformed IT operations and has disrupted the employee computing space. Since COVID hit we’ve seen an accelerated switch to remote and hybrid work and much of it seems to be permanent.
But there is one more big transformation that is taking place right now in the world of remote work. We can lump it all together under the concept of a “non-traditional workforce. Under this concept, I’m including everything that has to do with employees who are not your average pay stub employees but are under 1099. It might be self-employed workers, independent contractors, freelancers, real estate or insurance agents, gig workers of all sorts, and, lastly, offshore workers. I’d like to focus on this last category in this blog, as it has seen a major upswing in recent years.
Traditionally, talking about offshore workers, we would imagine Call centers in India or offshore developers in India or Eastern Europe. And this is definitely a big industry that is growing very fast. But things have rapidly changed in recent years. When talking to our customers we are seeing something that I could only define as a “Tsunami” of offshore work in new emerging geographies, and, probably the one we hear the most about is the Philippines.
Why the Philippines?
There are many reasons for the Philippines being the new offshore hub, some of which are depicted in these articles on LinkedIn by Nixon Abonita and Colin Michael or this article from Microsourcing. In short, the Philippines has a unique combination of culture, language, and skills, combined with relatively low wages, that is ideal for offshoring.
What is most intriguing about this is that it seems like this new offshoring trend is not limited to the traditional offshoring professions, such as call center workers or software developers.
Nowadays we see a growing diversity of professions that are being offshored to the Philippines, including administration, HR, and accounting. For the most part, we increasingly see offshoring of a broader set of functions that do not necessarily require day-to-day verbal interactions with their peers in the US but rather mostly number and Excel crunching, form processing, etc.
We are expecting this trend to continue and even increase in years to come. Economics and technology will keep driving it forward and we expect to see more functions in the organization being outsourced and offshored as these macro drivers continue to evolve.
We also expect to see more geographies evolve and become new hubs for offshore workers. It might be one specific function that gets offshored (e.g. SW development) but then an entire ecosystem evolves around it and enables broader offshoring.
So why not move everything? What are some key challenges?
So based on this clear trend, should we expect to see all functions gradually getting offshored? Probably not in the near future. There are some obvious human-related challenges, such as language barriers and cultural gaps that make people feel more comfortable working with people stateside. We’re even seeing a trend to move call centers back to the US and you might have even picked up on radio commercials talking about having “only US-based service representatives” as a differentiator for companies.
Time zone gaps are obviously another factor that makes working harder for employees in the US with offshore counterparts. It’s hard for organizations to move fast if critical lines of communication are drawn across significant time zone differences.
Lastly, technology is a major hurdle to cross. Many of the offshore employees are working from home in areas that are hard to access and just getting a computer over might become a challenge. Internet connectivity might be very spotty in certain areas. Lastly, international Internet connectivity can become a huge challenge. For example, the Philippines, despite becoming a significant hub for offshore work, is still very much behind in terms of international network and submarine connections, as can be seen here.
The direct impact is that any round trips to a remote server, such as in the US, are going to severely impact performance, the user experience, and employee productivity. Leveraging solutions that require connectivity to a remote environment such as VDI, DaaS, or remote desktops is going to be very challenging.
This is why we’re seeing a growing stream of companies with offshore employees in the Philippines and elsewhere who are turning to more modern secure remote work solutions like ours, that do not require connecting to remote environments and provide flexibility on BYOD laptops (BYO-PC) to reduce costs and issues shipping laptops back and forth.
In future blogs, I will also address some of what we’re seeing with other “non-traditional” workers and offshore employee use cases in the Philippines and other geographies.