Home Brexit Why Covid and Brexit have created the perfect conditions for outsourcing  

Why Covid and Brexit have created the perfect conditions for outsourcing  

19th May 21 1:07 pm

As preparations slowly ramped up towards Britain’s secession from the European Union (EU), one of the key issues was how new immigration rules would impact the ability of firms to access an adequate pool of talent. This was particularly true of the skilled workforce that comprises the tech industry.

Of course, it was always to be expected that Brexit would worsen the long-standing issue of the digital skills shortage which has seen startups count on an influx of foreign labour for years. Now, over half of tech founders (55%) believe that Brexit is the biggest threat to London’s booming digital industry, chiefly due to the increased risk of missing out on the best international talent.

The unprecedented long-term social and economic uncertainty caused by the Covid-19 pandemic has only exacerbated the issue. Firms will rightly fear this dual storm of challenging business conditions, and the impact it could have on their ability to adequately meet their staffing needs without taking an adverse toll on their operations.

However, firms may also begin to see an upside. The Covid-19 pandemic and its associated lockdowns provoked a global shift towards remote work, which has decentralised the role of the brick-and-mortar office, and opened up a diverse array of possibilities for the structure of organisations and workforces in the future.

Those who embrace this change fully could see not only a boost to their productivity and profitability, but a pathway around the difficulties posed by the twin forces of Brexit and Covid-19. Businesses in the UK will be able to take full advantage of the synergy with international partners engendered by the remote working revolution. Outsourcing will sit at the heart of this streamlined approach.

While unexpected, this development is welcome. Brexit is likely to make it more challenging to hire teams that meet short- and long-term business requirements, so added efficiency and labour flexibility will be key in the challenging trading years ahead.

What you should know before outsourcing operations

Many will be unfamiliar with the practicalities of outsourcing large swathes of operations overseas and feel overwhelmed by the options on offer. With this in mind, below are a few considerations to bear in mind when outsourcing IT and tech development.

  1. Avoid a race to the bottom

One of the most robust cases for outsourcing IT teams is the tremendous potential for costs savings. However, decision-makers should always be wary of the cheapest option. While there is certainly highly skilled labour to be found in flourishing tech hubs located in the likes of Eastern Europe, looking to maximise efficiency through the largest immediate costs saving is unlikely to reap the desired rewards.

While the lower overhead and fixed costs will seem appealing, particularly to firms looking to streamline operations in the aftershock of a challenging economic period, businesses should keep in mind that pricing rates will usually reflect the experience and quality of work on offer. A fine balance must be struck between costing and quality, or the broader benefit of outsourcing could be placed in peril.

  1. Experience is crucial

Careful consideration of what your potential vendor can offer your organisation is crucial to ensure a positive relationship and, at minimum, the satisfaction of your requirements. Any service provider under consideration should be able to provide numerous case studies reflecting the quality of their work on similar projects, in addition to positive relationships with previous clients.

As with all hiring decisions, the devil will be in the detail – any appropriate service provider should have comprehensive documentation backing up their suitability for your project, and a solid understanding of what is required for your particular organisation. Businesses vetting potential vendors should therefore look for delivery partners with deep domain experience and a strong track record of successful collaboration with firms in your industry. Awards and accreditations, for instance, can offer a good indication of the value that a vendor can bring.

  1. Finding the right fit

Though it may be tempting, it is important to avoid viewing outsourcing as a purely cost-saving exercise. Just as with traditional in-house hiring processes, assessing for a good cultural fit will be crucial in choosing the right service provider. This may mean looking for similarities in communication styles, similarly motivated team structures and goals, and their overall interest in your project.

To avoid disappointment, it is especially crucial to ensure that remote hires will blend seamlessly with your in-house operations and style, to ensure a strategic outsourcing partnership that works for both sides.

The world today is more digitally connected than it has ever been before. The economic shocks of Brexit and Covid-19 have combined into a new market with immense possibilities for businesses willing to make bold decisions to overcome a talent shortage and regain a competitive edge globally. The benefits of outsourcing will help them realise this potential.

Richard Leslie is CEO of The Sourcing Hub, a business development consultancy helping UK firms to scale their tech delivery capability through its portfolio of over 30 nearshore software services providers. The Sourcing Hub evaluates your business requirements, tech stack, your desired commercial model and budget, and then matches you with the most relevant service provider to ensure a successful long-term engagement.

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