Derek Gallimore, Founder of Outsource Accelerator and passionate advocate for outsourcing employees and global employment, recently joined Jonathan Westover for a conversation on Human Capital Innovations Podcast to discuss outsourcing workers; the pros, cons, and why it can benefit you and your company.
Derek states, “Outsourcing is the most transformative business tool available today.” It allows you to “... access the pool of 8 billion people across the globe…” and can save you a major percentage of your costs. When making the decision to outsource, “... you don’t want to go for the average, you want to go for the high performers”, and outsourcing allows you to not be restricted to a particular geographic location.
Despite the many pros, there are also a few cons that need to be kept in mind. “It seems [working with others] seems to be able to happen more organically when people are physically together.” Being in person and working with others while physically in the same room tends to increase communication and understanding between coworkers.
So, Derek suggests that would should “... try to get the best of both worlds, so to speak. There's benefits to being in person, there's benefits to the flexibility of the remote or the virtual work.” Often, when the option is there, "... it's really going to be beneficial to [your employees] to at least part of the time, be in person." Many employees enjoy remote working because “... [i]t’s easier and more fun to stay at home… but it’s not always good in the long-term.”
Derek again emphasized that outsourcing can be very beneficial for many companies. You aren’t limited by location or distance, but there are cons when it comes to productivity and communication between teams when working remotely. The best option is to blend them both, having different teams in different countries, and having them be in person some of the time. But something that is important to keep in mind when it comes to your company, Derek states, "I'm not sure there's a one size fits all, actually. I'm pretty darn sure there's not a one size fits all."
You can listen to the full episode at innovativehumancapital.com/podcast, or anywhere you listen to your podcasts, just search “HCI Podcast”.
Read the full transcript below:
Derek galamore. Welcome to the human capital innovations podcast. John, thank you. So excited to be here. It is a pleasure to be with you. You're joining us from the Philippines. I'm salt of Salt Lake City in Utah. So there's a wee bit of a time difference between us, and today we're going to be talking about global employment. So I think it's only fitting that we're on different sides of the globe. We're going to be talking about the seismic shifts in the current employment situation, the landscape and the traditions that make up the environment, and again, how those shifts are really changing the direction of things moving into the future of work. As we get started, I wanted to share Derek spyo with everybody. Derek Gallimore is passionate about outsourcing. It is the most transformative business tool available today. He believes he is committed to helping people integrate it into their businesses and see them thrive. Derek's blend of extensive international business and travel experience means that outsourcing came relatively naturally to him. Derek has been in business for over 20 years, outsourcing for over seven years, and has lived in Manila, Philippines, the world's outsourcing capital, for over three years. He has worked and lived in five countries and worked and traveled through dozens more. Again, a pleasure to have you. Thank you so much for joining me. Anything else you would like to share with me or my audience by way of your background or personal context before we dive on in? No, that's very accurate. A little bit old now. I've been living in Manila for about eight years now, and so everything is extended by about five years that you mentioned there. Unfortunately, we're all getting a little bit older. Wonderful. Well, that is fantastic. Extensive experience in this area. So I really appreciate you taking the time. I'm excited to pick your brain around these topics. All right, so as we dive on in, why don't you share with us just a little bit of your foundational understanding around outsourcing as a tool for business? I think we all have in our minds kind of the stereotypes around outsourcing in popular media, in pop culture, there's certainly this kind of caricature of outsourcing. Tell us what from your experience outsourcing is all about, and then we can start to get into what that means in terms of the shift in the global environment. Yeah, absolutely. So outsourcing, it's a hidden giant, really. A lot of people sort of see aspects of outsourcing but don't really understand exactly what it is and how it can help their business. At one end of the spectrum, people see large call centers that obviously do whatever content moderation for Facebook or Emirates customer service. Down the other end, you hear a lot about sort of upwork freelancers and the Tim Ferriss model of getting freelancers and bas and stuff like that. Both those exist, but actually neither of those really apply to the SME use case or market and outsourcing is a $250,000,000,000 industry globally on an annual basis. And it is now, for about the last 1015 years, exploding in the SME small and medium sized business use case. Where it is more applicable, there is it is basically staff augmentation, where you employ staff on a global basis based on their capabilities and their costs, not on their location. And they work beside you as any other colleague would or does. And this is such a powerful tool for businesses across the globe. One of the highlights is that you can save about 70% on your all in costs, which is an incredible sort of value proposition. But also it's not just about cost savings, it's also about accessing a global talent pool, literally a global talent pool. So instead of you sitting in New York or, you know, Utah or with maybe a catchment of a few hundred thousand people, you can literally access the pool of 8 billion people across the globe. And so you suddenly open up the opportunities for your business and generally you can save a huge amount of money. Yeah, so kind of the perspective of outsourcing in terms of these call centers in XYZ Country, in another part of the world, and people get frustrated because they don't feel like their English is very good. Like that's kind of the character, right? And there's entire TV shows and movies around that premise and the hilarity that ensues right, from miscommunication and whatever. And that's certainly a type of outsourcing. But to your point, I think it really includes a whole lot more. And we've seen over the course of the pandemic, we've seen more and more people moving towards virtual work and as a result, more and more geographical barriers breaking down to how our teams are structured. So we have more distributed teams and you have people who are fulltime employees of the organization, but contract employees, you have gig workers, right. However you want to frame it, the reality is we have people, workers from all around the world now that can join our team, that can augment our skill sets, our talents, our competencies and capabilities to help us achieve really great things. And that is a form of outsourcing. And so I think it's really important for leaders who may be stuck in maybe an old mindset or an old mental model of what outsourcing might mean to them to break out of that, to embrace the potential. Like you said, if we're stuck, like, you know, I'm in the Salt Lake metropolitan area, that's a big area. We have, I don't know, 1.5 million people or something like that sizable area. There's a good talent pool here, but that's only 1.5 million people out of a global population of 8 billion people. Why would I limit myself to the local population when literally, for many jobs, literally, they could work anywhere. There's no geographical restriction as to where they could live. As long as they have good technology and Internet connection and the time difference is manageable, then you can figure a way out to make it work and then you can tap into really great people anywhere. And to the point, you mentioned in some cases, if these are not full time employees of your organization, but rather it's freelance work, it's outsourced, gig work or whatever, there's actually a tremendous amount of cost savings there. Yeah, absolutely. You mentioned earlier there's a cycling shift and obviously with COVID the great resignation, all of this push for remote and work from home, it's forced a lot of more traditional businesses to really adopt this, and a lot of them were doing it begrudgingly. And sure, it's not for everyone, and I actually personally don't recommend that remote is necessarily the best option. But you can now have a team in one country and another team in another country very easily. And there are huge benefits to that in terms of quality. There are very bad people in outsourcing. There are also very bad employees in the US and all across the globe generally. You don't want to go for the average, you want to go for the high performers. And it is just complete fallacy that out of 8 billion people, you can't find one highly educated, highly capable person. There are incredible, incredible people spread across the globe. I live in Manila in the Philippines, and, you know, it has its fashion, it has startup culture, it has developers, it has all of the Fortune 500 here. There's Facebook and Google and Proctor and Gamble and whatever. Emerson Young and all of those top people. And those top organizations are very, very international, high caliber, highly capable people. And so you can find those people, and generally it is at a discount of about seven to 70%. So it's very powerful. And people now are realizing that you can employ globally and it can actually arguably be an advantage for your business, not necessarily just a disadvantage. So it's really, really evolving very quickly. Yeah, and you've already pointed to a few of those seismic shifts. There's a wide variety of things that are impacting the landscape of the world of work and what people are experiencing. The bottom line, though, is all of these things collectively are challenging assumptions about work and the way it works. Right. And so when we talk about employment traditions, the way things have always been, I think over the last few years, many people have been willing, more so than ever, perhaps, to challenge their assumptions, take a second look at why they did things the way they did things and come to the conclusion, well, wait a minute. We don't actually need to do it that way anymore. So what are some of those types of employment traditions that you've seen over the last 20 years, but particularly over the last few years shifting? And maybe there are others that in your opinion should be shifting and should be adjusting as we move into the future of work. Yes, you are more the shower experts. And for me, I tend to veer towards more of a sort of traditionalist slant in terms of work. I am worried, honestly, about the whole move, the very brash move towards remote work from home, because I know when I was in my mid 20s, in my formative part of my career, if I could work from home, that meant that I wasn't working. I was getting distracted on Netflix, and, you know, I'd be watching YouTube, and there's all this formative development that happens in an office, and it's not always fun. It's not always good, not always enjoyable at the time, but often, you know, professional development. And development as a person comes at the short term cost of discomfort. And so I sort of fear this massive swing towards everyone's working from home. There's no officers, and that's a sort of longitudinal study that we have never tested. The endpoint. And it will be fascinating to see, but what it does do, and we're talking on Zoom, we're spanning the globe, we've got video. It's seamless, it's incredible that did not exist ten years ago. And even things we take for granted, like emails and sending attachments and all of the online tools and interfaces and slack, and all of this is perfect for online work, for remote work, and even asynchronous work, if people are up for it. So there's an incredible sort of evolution towards this digital paradigm. And I think more traditionalists are slower to catch on to that. But the gen z or millennials of today that are growing up on TikTok and YouTube in chat rooms and preferred to text instead of really see people face to face when it comes to them being managers and employers, they're going to go like, why the hell are we hiring anyone in the same room as us? This is just crazy. There's 8 billion people on the planet. I'm going to go to the appropriate chat room or forum and find the best people for this role, regardless of where they're sitting. The office thing? Yeah, I'm not sure. Generally, I recommend that you can still get better productivity in an office. You can easily get an office in the Philippines or India, have them all there, have them all sitting around the water cooler, the desk, having those sort of moments, having that discipline, and you go from there. But again, it's courses for courses, I suppose. Yeah. And you highlight the tension that's there. And it's one of the reasons why so many people have moved towards this kind of attitude about hybrid work. Let's try to get the best of both worlds, so to speak. There's benefits to being in person, there's benefits to the flexibility of the remote or the virtual work. So let's find out a balance, perhaps that works for our team and the type of work that we do. Obviously different types of work, different types of jobs and tasks might be better suited for one form of work versus another. And that tension, I think it hasn't been resolved, certainly, and we're going to continue to wrestle with this. Like you said, it's like a longitudinal study that we have to watch over time. There certainly were fully remote organizations prepondemic, but they were rare. I personally know of some people that worked for fully remote organizations prepondemic and I've had really interesting conversations with them. But let's not fool ourselves. They were incredibly rare and in the vast majority of people still worked in the office. And so we do have limited data points. Look at some of these other organizations that found a way to make it work, even prepondemic, even for the last 20 years. But in aggregate, as we look at the landscape of the workplace and the labor market generally in a much higher scale now, more organizations are wrestling with us and we just don't know, we don't know what the long term impacts are going to be. And I think you highlighted something that's really important, especially younger individuals who are early in their career. There's a lot of just professional development that happens informally in those casual off moments between meetings. You're just interacting with people, watercooler moments, all of that kind of stuff that it's not impossible to replicate virtually, but it's harder to do virtually. And so if you're going to make sure that your young people have the opportunity for coaching, mentoring, career development and progression in your completely virtual office, you better be really attentive to that fact and look for ways to make sure that that's happening. Otherwise you're really going to be doing your young people at a service and they're not going to progress in their careers the way you might want them to, the way that they might better be able to if they were in a physical office space. But it will be super interesting to watch over time to see if organizations are able to crack that code and figure out how they can do it really effectively. Even if we're primarily hybrid or remote and we're not together all that often. So we'll see, I mean, the jury's out and we have to see what happens over time. And so there's all these different types of approaches, these traditions. There's simply preference differences. Sometimes it's a life stage thing. I don't think it's really necessarily even older generation, younger generation, but I do think it's largely life stage. There are certain periods of your life or maybe you'd benefit more from being in the office. Maybe there's periods of your life and certain types of roles, certain types of work that you do where it would be really helpful for you to have more flexibility. And frankly, you already function with a high level of autonomy and you know how to work productively, etc. But maybe those are the people we set loose and let them work remotely ultimately. I'm not sure there's a one size fits all, actually. I'm pretty darn sure there's not a one size fits all. I wonder if there's going to be a double class society. Not that there isn't already, but you're going to have the workers that need to be on site, whether they're sort of engineers or electricians or baristas and Starbucks, versus maybe potentially the more white collar roles where all the developers can stay at home or work from a beach. And does it create this sort of divide in society, which again, could be pretty well have an impact whether it's good or bad. And then also Matt Mullenweg WordPress who automatically run an asynchronous organization. He was always saying, look, you've either got to be fully remote or fully in the office, because the ones that then go to the office have more favors, become more aligned with the management, are there for more roles. And then so it almost creates an unfairness in that it's really complicated thing that we're going to have to collectively unpick as a society going forward. Yeah, and I've seen that too. I've seen organizations that are predominantly in person, but they have a few people on the team who work remotely and yeah, the people who work remotely, they have some extra work to do to make sure that they're staying on top of, like, the organizational politics, that they're getting the face time with the boss, you know, those sorts of things. Or the boss needs to put a little bit of extra effort to make sure that they're having those types of opportunities. It's a challenge for sure. It's kind of a proximity bias, isn't it, as well? Yeah, and we see that with teams in the Philippines. Like when people are just sort of whatever voice on a computer or chatting or sending work, the bond and the sort of realization that they're a real, capable, proper person is far minimized. But when the clients come over or sometimes the staff go over to the client, it's just ten X, suddenly they realize it's a person and they see the person behind the computer screen and there's a bit of that sort of, I suppose, human bonding. And then they realize, wow, these are far more capable people than I ever gave them credit. And we'll load them up with a load more work and we'll put them into the management training scheme because you just get almost done a high fidelity 3D impression of this person as opposed to just whatever they're typing over email. It's fascinating to see. Yeah. And you highlighted I mean, we saw during the pandemic when much of the world went virtual and remote, you still had people who had to work in the warehouses, who had to work in the stores, you had frontline workers, right. You had people had to be there physically in person. And it did create this bit of an extra kind of tiered system in society. And so I think that's a really interesting observation that you made. And we don't know ultimately what the long term impact of this will be, but it is something to be very mindful of and thoughtful about as we move forward. And to your point earlier, if I'm a CEO or a senior leader within an organization, and I'm wrestling with this, I'm wrestling with how do I tap into the best talent anywhere in the world that necessitates the willingness to have people work remotely, right? Because people aren't going to be relocating from anywhere to come to Salt Lake City necessarily. Some will, but many won't. And so I have to, on one level, be comfortable with and lean into this additional remote work and contingent and distributed teams. On the other hand, if I see the value, whether it's collaborative value of people being together in the same room, that human connection and the collaboration and the innovation, creativity that can happen, it seems to be able to happen more organically when people are physically together. Whether it's that or whether it's just the mentoring piece, the coaching piece, like you were talking about, the professional development, whatever it is, these are the ongoing wrestles that we're going to have to struggle with. And I think as long as we are attentive to it and having regular conversations and talking with our people, I think we're up to the challenge. There's going to be two steps forward, one step back along the way. I don't think this is going to be super smooth sailing. It's going to be rough waters, but we can do it. The other thing that I wanted to double click on that you mentioned a few minutes back is when we think about younger people, digital natives, people who are younger, millennials, gen Z, and they're trying to understand, why would I need to be there physically to do this job? Why can't I live anywhere? Why can't I live in my sprinter van and travel around the world and just work from wherever I happen to be? And so on the one hand, they have a good point, like depending on what they're doing, they may not need to actually physically be in the office. And if you want to tap into that talent, you're going to have to have some level of flexibility. On the other hand, I think it's our job as leaders and organizations to help them understand and to communicate to them why it's so important and how it's going to benefit them. Like, you're not trying to control them, you're not trying to take away their autonomy or flexibility. And in fact, you can find ways to build in autonomy and flexibility, whether people are fully face to face or remote or hybrid or whatever mix. But if I can communicate that better to them and help them understand why it's really going to be beneficial to them to at least part of the time, be in person. I think we can bridge that perhaps generational divide or life stage divide that might exist for a lot of younger workers. And if they know that we care about them and that we're trying to help them, we're not trying to control them, we're trying to help them, I think that will go a long way. Yes, I do worry about that. It's easier and more fun to stay at home, and it's easier and more fun to have eat lots of chocolate and have all the dessert, but it's not good long term. And it's very hard to train for a marathon, and it's grueling, and it's immensely difficult to train to be an Olympic athlete. Grueling, absolute blood, sweat and tears. But those hard things you grow from as a professional, as a person. And so I worry that if we're always sort of in a comfort zone and everyone's working from under their duvet in bed and they're never pushed into those sort of awkward moments of having to do a presentation in front of their senior bosses or those sort of kind of critical professional moments in a career that are hard at the time, then where do you get that development? And I'm a fairly fit guy, motivated guy. I go to the gym every day. But if it wasn't for the gym, I would not exercise. If it's at home, I wouldn't do it. I have to go to the gym. And then that's when I turn on into my exercise mode and I worry for the complete sort of dissolution of offices. But again, maybe that's just sort of old. Maybe we're just sort of taking it from a place where we have been instead of looking at it from a perspective of where it's going. Well, that's the ongoing wrestle right in the tension. And I think it's good for us to be having these conversations. Well, Derek, it has been a real pleasure. I know at the time I'm going to have to let you go here in just a minute. But before we wrap things up for today, I wanted to give you a chance to share with the audience how they can connect with you, find out more about your work, and then give us the final word on the topic for today. Yeah, absolutely. We aren't actually an outsourcing firm. We are an outsourcing marketplace. So we're a little bit like the TripAdvisor for the outsourcing industry. We list about 3000 outsourcing firms on our website, so we also have about 150 pages of content. We also have a YouTube channel and podcasts and all just basically educating about global employment, outsourcing, BPOs and everything you need to know about it. So it's free to you, to the client, to the browser, have a look at the website, it's outsourceaccelerator.com, and just take a look around and outsourcing can benefit 99% of businesses in 99% of sectors. And basically any role, as long as that role is done predominantly in front of a computer, then it can be done offshore. It's an incredibly sort of compelling value proposition, and just one that I think, as we now enter into a recession, as times get harder, that employers and businesses are now a little bit more compelled to at least explore. It's their almost fiduciary duty to explore, to see whether this is suitable for their business, because it is absolutely transformative when it's done right. So, yeah, check out the website and that's it, really? Yes. Wonderful. Thank you, Derek. It's really been a pleasure. This has been a fun conversation. And as always, I hope everyone, one can stay healthy and safe. They can find meaning and purpose at work each and every day. And I hope you all have a great week.