Top 13 Examples of Offshoring: Companies that Were Successful and the Reasons Behind the Ones That Failed

In today’s interconnected world, offshoring has become a strategic move for businesses seeking cost efficiency, access to skilled talent, and operational flexibility. However, while many companies have thrived through offshoring, others have faced significant challenges. In this blog, we explore the top 13 examples of offshoring, highlighting both successes and failures to provide valuable insights for your offshoring strategy.

What Does Offshoring Mean and What Are Examples of Offshoring?

Offshoring, or the use of talent from a different country than the one your company is based in, has become increasingly common across various industries. Some of the most common examples include hiring for marketing roles, creative roles, sales roles, client success roles, video editing, and copywriting. Many startups use an offshoring partner like Remote Latinos who help companies build their offshore team and grow their business.

Top Reasons Why Companies Opt for Offshoring Solutions

1. What Flexibility Does Offshoring Offer in Creative Roles?

One of the primary reasons why companies offshore their creative roles is the flexibility it affords in the hiring process. When startups need to rapidly scale up or down according to demand, they can do so more easily by tapping into an offshore talent pool. This way they are not limited by the number of full-time employees they have on staff at any given time; instead, they can flex and contract as work demands.

2. How Do Time and Cost Savings Make Offshoring Attractive?

Technology startups use offshore talent to save both money and time. By working with a dedicated offshore team, startups can get their projects completed faster and at a lower cost than if they were to develop the products entirely locally. In addition, by offshoring non-core business tasks, companies can focus their limited internal resources on more important tasks that directly contribute to their bottom line.

3. Why Is Access to a Wide Pool of Highly Skilled Creatives Important?

Startups are increasingly turning to offshore workers to tap into a wide pool of highly skilled creatives. This trend is driven by the allure of accessing talented professionals who offer exceptional expertise at a more affordable cost compared to their counterparts in countries like the United States. This advantage allows startups to optimize their budget and invest in other critical areas of their business.

4. How Can Companies Access Specialists Through Offshoring?

Often times a startup is looking for a very specific type of professional with niche skills. These individuals are hard to find, particularly if you only look locally. Offshoring this role dramatically increases your chances of finding these specialists.

5. How Does Offshoring Streamline Paperwork and Legal Compliance?

By transferring their creative and operational needs, companies can alleviate the burdensome tasks of maintaining proper records, navigating complex taxation rules, and addressing intellectual property concerns. Good offshore vendors effectively eliminate the bureaucratic challenges that often accompany hiring talent in foreign countries.

Successful Examples of Offshoring

1. How Did Headspace Successfully Offshore?

Headspace, a leading meditation app, successfully built its innovation center of excellence in Mexico with the help of TurnKey. The entire first round of offshore hiring was completed within 30 days, allowing Headspace to accelerate their plans and scale efficiently.

2. What Role Did Offshoring Play in WhatsApp’s Success?

In 2014, WhatsApp was acquired by Facebook for $9 billion. The company hired creative and operational teams in Eastern Europe, which helped it grow rapidly and become one of the most popular messaging apps in the world, with over 450 million monthly active users at the time of acquisition.

3. How Has Google Leveraged Offshoring?

Google has extensively used contractors and offshore talent to enhance its development capabilities. By acquiring CloudSimple, a Ukrainian company, Google consolidated its position as a leading provider of cloud-based services, demonstrating the effectiveness of offshoring in fostering innovation and expansion.

4. How Does Amazon Benefit from Offshoring?

Amazon has offshored its research and development to a Ukrainian startup specializing in home security systems. This strategy has allowed Amazon to access exceptional talent at a reasonable wage, maintaining its competitive edge in the e-commerce and cloud computing industries.

5. What Offshoring Strategies Has Slack Used?

Slack offshored significant parts of its development, including logo creation, marketing and design, and software for web and mobile apps. This approach has contributed to Slack’s popularity, with more than 12 million daily active users.

6. How Has IBM Utilized Offshoring?

IBM has a long history of offshoring and continues to offshore talent for creative roles, consulting services, R&D, and monitoring cloud-based computer systems. The company has become the largest multinational employer in India, investing significantly in the country’s infrastructure and economy.

7. How Did JPMorgan Chase & Co. Successfully Offshore?

JPMorgan has expanded its operations in the Philippines, employing locals for software development and operations. This strategy has helped the company reduce costs and boost profits without sacrificing service quality.

8. How Has People.ai Leveraged Offshoring?

People.ai opened an R&D office in Ukraine to access a talented pool of AI developers. This move has allowed the company to create innovative products and improve existing ones while benefiting from lower operational costs.

9. How Did Lyft Use Offshoring to Strengthen Its Tech Community?

Lyft established a software research and development center in Eastern Europe, focusing on data mapping and improving its services. The center has already made significant progress, contributing to Lyft’s product development efforts.

10. How Did BigCommerce Benefit from Offshoring?

BigCommerce opened a company offshoring unit in Ukraine, successfully building a team of over 30 developers in just six months. This move has positioned BigCommerce for rapid expansion and innovation in the e-commerce space.

11. How Did ThredUp Revolutionize Its Operations Through Offshoring?

ThredUp opened a software R&D office in Ukraine, tapping into highly-skilled tech professionals. The company’s offshore team includes machine learning specialists, Java programmers, and .Net Warehouse developers, contributing to its impressive growth and success in the online resale market.

Companies Offshoring Marketing, Sales, and Video Editing Roles

12. Which Companies Offshore Marketing Roles?

• HubSpot: HubSpot offshores a range of marketing roles, leveraging talent from various countries to enhance their digital marketing, content creation, and SEO efforts.
• Buffer: This social media management company offshores many of its marketing tasks, such as content creation, social media management, and email marketing, to skilled professionals worldwide.

13. How Do Companies Benefit from Offshoring Sales Roles?

• Zendesk: Zendesk offshores its sales roles to regions with high-quality talent pools, allowing the company to expand its sales operations and reach new markets more effectively.
• Shopify: By offshoring sales roles, Shopify has been able to scale its sales teams quickly, tapping into global talent to drive its growth and market presence.

14. How Are Companies Utilizing Offshore Talent for Video Editing?

• BuzzFeed: BuzzFeed offshores video editing to talented professionals around the world, ensuring a constant flow of engaging video content while managing costs effectively.
• Vimeo: Vimeo utilizes offshore video editors to handle a large volume of editing work, allowing them to produce high-quality video content efficiently and affordably.

Offshoring Failures and Lessons Learned

15. What Went Wrong with Accenture and Hertz’s Offshoring Partnership?

Hertz accused Accenture of breach of contract, fraud, and negligence due to a failed project to build a new customer-facing website and mobile apps. The result was a buggy website and apps that had to be completely rebuilt, highlighting the importance of carefully vetting offshoring partners.

16. Why Did Navitaire and Virgin Airlines’ Offshoring Efforts Fail?

Navitaire’s software crashed twice within three months, causing significant disruptions for Virgin Airlines. This failure underscores the importance of reliable software development and the risks associated with inadequate offshoring strategies.

Potential Pitfalls from Offshoring

While offshoring offers numerous benefits, it is crucial for startups to be aware of the potential pitfalls that can lead to failures, like in the previous examples. Ideally, this firsthand experience and substantial research have highlighted the importance for companies considering offshoring solutions to proactively identify and mitigate these risks:

• Poor offshoring partner: Carefully research potential providers before heading down the offshore development path.
• Wrong choice of location: Consider all factors, including labor costs and infrastructure, before deciding where to hire offshore.
• Weak communication management: Maintain open lines of communication to avoid miscommunication and delays.
• Lack of control over business processes: Ensure safeguards are in place to maintain control over the development process.

How to Make Offshoring Work for Your Startup or Company

1. How Can Setting Clear Goals Help in Offshoring?

Setting clear goals is essential for any team, but it’s especially important when offshoring. Without clear goals, it can be difficult to know whether or not your offshoring partner is meeting your expectations.

2. What Time Zones and Cultures Work Best for Your Team?

Consider what time zones will work best for your team, the kind of culture you want to work with, and their language and values before making a geographical decision about where to offshore.

3. How Can Time Zone Differences Be Used as an Advantage?

Use time zone differences to your advantage by hiring employees in time zones that slightly overlap, allowing your team to work around the clock.

4. What Effective Communication Channels and Tools Are Essential?

Invest in reliable video conferencing software and project management tools to maintain a cohesive workflow with your remote team. Set clear expectations from the start to ensure everyone is on the same page.

5. Why Should You Partner with a Great Offshoring Provider Like Remote Latinos?

Remote Latinos helps you retain control over your team while handling all the administrative work. We custom recruit your dedicated marketing, creative, sales, and operational team and provide transparent pricing, so you’ll always know exactly what you’re paying for.

How Does Remote Latinos Help You Turn Your Offshoring Into A Success Story?

Thanks to our years of experience and proven process, Remote Latinos provides you with top offshore talent faster than most offshoring companies. We custom recruit your dedicated team, and we are super transparent when it comes to pricing, so you’ll always know exactly what you’re paying for. Even better, we can help you reduce churn dramatically. If you’re looking for a recruiting partner that can help you take your startup to the next level, then you should contact us today. We will build YOUR team on YOUR rules to lead you to YOUR success–we call it the YOURshore way!

Final Thoughts

Offshoring can be a great way to get the help you need for marketing, creative, sales, and other roles while saving time and money and still maintaining control of your startup. But it’s important to do your homework first and make sure you’re making the best decision for your company – and partnering with a firm you can trust. Otherwise, it could end up costing you more in the long run.

We’ve Helped Tons of Companies Reach the Offshore Promised Land

Contact Remote Latinos Today!

FAQ

From a creative and operational perspective, offshoring is the use of talent in another country from the one your company is based in. The most common examples of offshoring services in the marketing and operational industry include hiring marketing professionals, creative talent, sales teams, client success roles, video editors, and copywriters.

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