Australian recruitment agencies have developed a strong affinity for offshore resources. There was a trickle of activity prior to Covid but it is now a rush.
Traditionally a Virtual Assistant (VA) provides general administration duties that might typically be performed by a personal assistant, but this definition does not do justice to the wide variety of services offered. For a more comprehensive view, refer to Staffing Industry Analysts “The Virtual Assistant Landscape”.
Now, it’s becoming increasingly rare to find a medium to large recruitment agency that does not offshore some functions.
However, not all offshoring arrangements are created equally. There is a scale of services that address different needs in different circumstances.
On one end of the scale are the situations where an individual is hired in another country, and payment made directly to that individual from the on-shore company. Whether these workers are compensated fairly and taxes are duly managed can vary. Typically, they work from home, using their own IT setup and relying on PC-based communication. The onshore organisation is totally responsible for supervision, training, coaching, IT security, quality assurance and finding a replacement if circumstances change.
At the other end of the scale are fully managed business process outsourcing organisations that, on the surface, provide the same product – an offshore resource at an attractive fee. But this is an organisation that is quality certified in its business processes, has certified IT facilities, provides insurance, and enhance staff performance and productivity through internal recruitment, learning and development, quality assurance, and account management.
Strategy and Risk
Between these two extremes lies a spectrum of organisations, each with its own approach. The critical questions for recruitment agencies are: what are you trying to achieve, and how much risk are you prepared to take?
It is often said that the world does not have a skill problem, it is just that the skills are in the wrong place. Recruitment agencies have many constricting challenges, none more than the cost and availability of internal staff, and the lack of flexibility and the limiting options that imposes.
There will be circumstances where short term administrative tasks might be efficiently handled by a resource found via Upwork, Freelancer.com, or a company that provides VA’s.
Yet, integrating offshore staff into your ongoing recruitment processes is a decision that demands careful consideration. An offshore team should offer clear advantages, such as:
- Cost benefit (or you wouldn’t do it),
- Ability to scale up and scale down,
- Productivity in the tasks undertaken,
- Consistency over time on functions such as compliance,
- Agency productivity by removing administrative functions from onshore resources,
- Ability to undertake different margin work such as servicing MSP/VMS arrangements,
- flexibility to provide additional services such as out-of-hours support.
All this must be accomplished securely and confidentially.
There are any number of case studies that highlight this and more. Some have gone as far as having a small onshore team and almost every function of the recruitment agency is offshored. That is not recommended for everyone but does highlight how far the services have progressed and what is possible.
An offshore partnership - and I emphasise the full weight of that term - opens up new solutions to the strategic challenges facing recruitment agency leaders.
This article was going to be titled in a much more provocative manner, such has been the frustration with recruitment agency owners and managers taking a shallow and short-term view of this mature business-enhancing service.
We assert that an offshore partner, in conjunction with Leadership and Technology, will constitute the cornerstone of a thriving recruitment agency in 2024.
I welcome your thoughts and comments.
For over a decade we have been working closely with IMS People and watched their 3000 staff from India and the Philippines provide enormous strategic benefit to recruitment agencies in the US, UK and ANZ.
HHMC Global operates within the staffing and recruitment industry on equity transactions, market valuations and business growth advisory. Contact us to discuss further.
