If you read any business magazine or business section in any major newspaper a prominent theme of late has been how organizations are learning the lessons of the recent downturn in the global economy. One lesson is to cut costs and focus more on primary profit generating functions. By streamlining and fine tuning, organizations are changing their internal structures to meet the new budgetary realities while still striving to generate continued customer satisfaction and stabilize revenues.

Outsourcing to far flung regions of the globe over the last 5 years has been the tried and true solution to such cost related dilemmas of budget management. The buzz words “outsourcing,” “offshoring,” “nearshoring” all entered into the business dictionary of common phases due to the perceived success of this new trend.

Just how successful has the global zipline to redistribute functions actually been for corporations? Many companies are finding that production quality is less than optimal. Processes are performed adequately but communications and management tasks require extended efforts and time away from core business concerns. Trusted vendors are not so trustworthy after all and proprietary information has been found in the hands of competitors or foreign startups. Additional political pressures have created a level of public outcry causing a decrease in customer satisfaction.

Picking up the phone and calling a vendor in India, Philippines, or even China and determining the cost per hour of their outsourcing programming may appear to place a company on the fast track to reduced costs for their non-core or technical processes, yet does reality match the perception?

•Customer Satisfaction rates have fallen dramatically since the use of Indian call centers peaked in 2008. Lack of common culture and user experiences created difficulties in successful customer service resolutions and interactions.

•IT production quality must be check by in-house and more experienced staff to ensure quality code execution and integration within a final product or perfected user experience. Compatibility issues, debugging, or rewriting of code can push back deadlines and cause client dissatisfaction.

•Lack of dedicated agents can increase issues for training or execution of scripted deliverables. High turn-over rates and lack of dedication to a vendor’s client means lack luster performance rates and no incentive to communicate customer issues before they affect a client’s bottom line.

•Knowledge of slippage from optimal performances to less than optimal, or even unacceptable performance levels, can have a significant delay in reaching an executive’s dashboard. While targeting the area in need of improvement, or to issue corrective measures, can require extensive analysis, early morning phone calls and travel to the vendor’s location in order to achieve acceptable results once again.

So where is the real savings from outsourcing? Increasingly more and more companies are realizing, through experience, that cost per hour is not the best evaluation method when it comes to parts of your business – especially those functions, while not core to the company, are areas that customers or clients touch and become the face of an organization. In other words, short term upfront value does not equal long term revenue increases achieved by real world cost reductions and high customer satisfaction.

Many companies have begun to revisit captive vendors or are looking to shared services options as a way to ensure economies of effort and retain the cost savings they initially experience when they first started outsourcing. Yet the optimal solution just may be the best of both outsourcing and captive/shared worlds – Sheltering.

A [1] shelter provider is your operational management services partner. What are operational management services? All those services that are required to run a business but are not directly related to profit generating functions. Human Resources, Accounting Services, Procurement, Office Management, Facilities Management all fall under non-profit generating but necessary to operations. Sheltering allows companies to securely outsource and reduce labor costs without having to take on all those [2] ancillary functions in order to achieve cost reduction goals.

The golden nugget of shelter services is that you retain control, complete control, over all proprietary data, processes, and branding! By maintaining security you can confidently grow your business without worry that by outsourcing you may be increasing your competition unwittingly. You also retain control over production quality and process results because you are operating your business in partnership with the shelter provider. You continue to manage your processes and implementation of new projects can be no different than it was when everyone was under the same roof. Employees hired under the shelter model work for your organization not the provider. Thus they are as motivated as you to achieve success. You can’t find that kind of dedication from traditional outsourcing providers!

Sheltering has created value for organizations seeking a “better way” to outsource and a world class provider is on the doorstep with the United States. [3] Vangtel has provided world class shelter services to companies in conjunction with its parent company, The Offshore Group, for over twenty years. As a shelter provider Vangtel assists companies to enter into Mexico and operate a business without having to deal with all the administrative management, facilities management, and legal issues found in a foreign country. Located in the same time zone as the Western U.S., as well as, only a short flight south of Phoenix, Arizona, reduces management’s time and travel commitments needed for success. Thus the true overhead costs of outsourcing under a shelter model remain compatible with a organization’s budget reducing goals.

Are you considering a shared services or a captive model in order to regain your outsourcing benefits? Vangtel can provide a customized solution, including facility space and tenet improvements, geared to your cost reduction goals. Please visit our website to read more about this exciting hybrid outsourcing solution. [4] www.vangtel.com