Time Zone Arbitrage in Outsourcing
Time Zone Arbitrage in Outsourcing

Do you exclude offshoring outsourcing services due to different time zones?

Outsourcing is the way to leverage your business, by pushing non-core tasks towards expert 3rd party providers who represent a lower cost than if your team were to perform them, while assuring a higher quality product.

The Outsourcing market is, in fact, Global; and over the years it has evolved to a context where some geographies have become pools of specific expertise like: India and Pakistan concerning software development or the Philippines concerning Virtual Assistants.

Some companies refrain or simply discharge hiring freelancers or Outsourcing services from some geographies due to time zone differences or because the local culture is perceived not to incorporate either a methodic work development approach or the same Quality standards as per one’s own client's requirements.

Well, concerning the last two obstacles, non-existant methodology and poor Quality, the fact is that there are several ways to overcome them. The methodology can be set in place (if despite the inherent additional coaching effort/ cost there is still a “business case”) and Quality can be achieved through proper retribution criteria (payment upon meeting Quality standards), which is what most big corporations do.


Understood. But how can I establish a productive workflow within a services context with someone who is asleep while I am working?!

If all your services portfolio requires very short response times (up to 4 hours) where you need to directly interface with the client, it may definitely not be something for you to consider. But if a part of your services portfolio does not require tight response times towards clients, hiring expertise from very different time zones may, in fact, prove to be a very relevant competitive edge.


What if Outsourcing from literally across the world means getting ahead of the competition?


Time zones map


Let’s consider North American businesses that deliver project or task based services, like an agency that provides articles, blog posts content or even marketing material; or a software development company or even a business consulting company that produces market analysis reports. If these companies were to outsource their portfolio services to proximate time zone entities, that would, in fact, mean the advantage of faster live communication if needed be, due to basically the same work cycle.

Now, let’s consider for a moment the concrete example of a US-based business consulting company that, on a given Monday at 17:00 hours, is asked by a US-based client to urgently deliver a short market analysis case study about a very specific topic (like, sales potential of product X in the North American market).

By the way, this is more common than most of you may think.

If the work were to be developed within the same time zone, one of two things would happen:

  • either the price tag would significantly need to be above standard, since some local resource would have to work throughout the night. An higAr standard hour rate that is raised even further extra production work schedule.
  • Or, the client would have to wait at least 24 hours to get the study.

If, within the same scenario, the US-based business consulting company were to outsource the job (literally across the world, where at 5 p.m. US East Cost means  9 a.m. local time), the end result would be the client having what he urgently needs, being delivered to his/her “doorstep” by early morning the following day.


What impact do you think such delivery time frame would have regarding client satisfaction?


Having a trustworthy remote offshoring outsourcing choice available, may represent getting ahead of much bigger/ well-established competitors and becoming the partner of election for a client in pain.

We all know that urgent work is more common than it would be expected in a business society where the trend is to praise and work hard in establishing lean processes while mitigating errors and promoting continuous improvement. The consequences of not complying with such “red flags” are becoming more severe by the day, hence shorter turn around delivery timeframes increasingly implying having the work done overnight.

Success requires effort, dedication and strategic thinking and nowadays reaching a high competitive edge status means (more than ever) to be one step ahead of competition, so it would be prudent to start a selection process for potential outsourcing providers that live around a -12 hours’ time zone, and to do it while still not under effective stress.

Once your choice is made and having put them through a set of responsiveness and quality tests (maybe even investing in some coaching), you will have in your portfolio a delivery flexibility within a cost range that YTD has no match within most of your competitors.

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