We’ve already explained why offshoring has many benefits, especially for tech companies looking for cost efficiencies. Now we’re going to tie all of that directly into customer success, one of the hottest topics of discussion these days, by exploring the pros and cons of offshoring your customer success team.
Pros of offshoring customer success
A CB Insights analysis examined post mortems to compile the 20 most common reasons tech companies fail. Ignoring customers came in at number 9, while running out of cash or having the wrong team in place came in at numbers 2 and 3, respectively.
Offshoring your customer success team is an option that, when done well, can solve all three of these common pitfalls. Here are the most important benefits:
Cost-effectiveness
The often referenced McKinsey report on offshoring set the expectation that you can see a cost savings of up to 60% by using offshore staff versus in-house. This means that you have the ability to hire more people for the same amount of money.
If you are based in a tech hub where salaries are above national averages, cost savings can be even more significant. For example, the average annual salary for a Customer Success Manager in San Francisco is $79,000 according to Glassdoor. In the Philippines (where many CSMs have extensive experience working for U.S.-based startups), a comparable employee hired through an offshoring firm can cost as little as $20,000 USD per year.
Easy to scale up
With an offshore team, you can quickly onboard and scale your customer success teams to match the demand from your customers.
There are several reasons why this is often easier to do offshore. First, the right offshoring partner will have a large pool of talent to draw from quickly (we’ll go over this point further in the next section).
They’ll also have established processes that allow for lightning-fast onboarding so new team members can be added — and ready to hit the ground running — in a matter of days rather than weeks.
Curated Talent
Especially in competitive U.S. tech hubs, it can be almost impossible to find talent. And even if you do manage to get a good candidate, they’ll have a lot of other options — and therefore a lot of salary-negotiating power.
With the right offshoring partner, you get to hand-select your team from a wider talent pool than you have available locally. That means you can be more particular about the skill sets you need for your new team rather than trying to conform to what is available (and affordable) locally to fit those needs.
Ultimately, you’ll get a better fit (without needing to shell out huge salaries to be competitive with other companies in your area).
Round-the-clock service
A recent Salesforce survey found that 64% of consumers and 80% of business buyers expect companies to respond to and interact with them in real-time. But 24/7 service isn’t easy (or cost-effective) to provide, especially if you’re based in a single time zone.
With an offshore team, it’s much easier to stagger service hours across time zones to match the needs of your customers. The right offshoring partner will allow you to set your team’s hours, so you can ensure your service is available to customers whenever they need it.
Hurdles for offshoring customer success
There are few true “cons” to offshoring customer success teams that need to be considered and planned for before making the decision to offshore.
Management
Offshoring is not a silver bullet. It’s also not to be confused with outsourcing, where you can hire a third party, point them at a target metric, and turn them loose (spoiler: there are a lot of downsides to outsourcing).
Running an offshore team takes just as much ‘work’ as running a local team. Your offshore team members will still need your support, communication, and leadership, so learning how to best manage a remote team is key.
Bad business practices
For those who are suspicious of offshoring, this is often the main concern.
Like any industry, there are varying degrees of quality, transparency, and honesty. Beware of opaque offshore staffing providers who shy away from questions about worker conditions, office facilities, and compensation packages.
Cultural differences
Customer success is rooted in the idea that a company understands the needs of its clients. This means that special attention is required when it comes to alignment — your offshore team and in-house team need to be on the same page when it comes to customer expectations and how to approach customer interactions.
Cultural differences exist. That is a fact. But cultural diversity (or any type of diversity for that matter) is only a hurdle when it is ignored instead of addressed, embraced, and intentionally incorporated into your company culture and talent strategy.
Over to you
While there are certainly some hurdles to overcome when establishing an offshore customer success team, the upsides ultimately outweigh them.
One of the most important factors for your success will be choosing an offshore partner that’s right for your company — one that has the capabilities to meet all your needs and exceed your customers’ expectations.
Bolton Remote is an experienced partner to startups at every level that need to streamline their customer success capabilities
