How the Remote Employee is helping Startups Survive

Startups have become synonymous with entrepreneurship and innovation in a world where technology is driving and dictating means of production. The profusion of app based products and enterprises which depend on their online profiles to attract potential clients has resulted in the mushrooming of businesses which require low capital inflow and minimal overheads. However, while this has led to a new generation of entrepreneurs, these enterprises have often found it hard-pressed to source the best talent available locally, due to lower economic clout. Hence, these enterprises have looked to hire remote employees abroad in an effort to access the necessary talent at affordable rates.

When one is looking to hire remote workers however, they are faced with a few crucial questions. Unlike local talent, the concept of the remote employee comes with its own set of unknowns. The entrepreneur will justifiably have doubts regarding the efficacy of such an arrangement. The question of “whom” and “where” will also take precedence; since the offshore outsourcing industry is today a mature multi-billion dollar industry with quite a few global hotspots- each offering its own set of unique advantages and challenges. In this article, we will discuss the benefits of hiring remote employees, how to go about it and discuss the challenges one might face when one looks to hire remote employees.

The WHY’s

1.       Cost- One of the foremost benefits you accrue when you hire remote workers is cost saving. When you hire a virtual employee in an offshore location like India or the Philippines, the rules of the game change significantly. You are not bound by wage structures prevalent locally, and are instead waking up to new realities in a completely different country. Just to give you an idea of how different the realities are between developed markets and the developing ones- as most outsourcing hubs are- I have provided a table below which shows the rates for mobile app development in different countries. The developed markets from which work is generally outsourced out are marked in yellow. The markets which generally receive that flow of outsourced work are marked in green.

 

As you can see, when you hire remote workers, the cost reduction is significant- anywhere between 50 percent to even around 75 percent, depending on the domain.

2.       Due to a general crunch in available capital and a “zero-frills” work culture, startups are hard-pressed to find and retain the best talent available locally.  You can overcome this challenge however if you decide to hire remote employees at an offshore destination. We have already explained the benefits in costing. This translates into greater access to better and more qualified talent in the offshore outsourcing hubs, where the amount of money you would be spending, which despite being low for a worker locally, is still more than sufficient for a professional in say India or Eastern European countries like Bulgaria, where cost of living is low.

3.       When you hire a virtual employee, you don’t just save on employee remuneration, you also save significantly on overheads and infrastructural investment- like having a larger office space. If you are running a startup, it’s only prudent to focus on your core business and keep the operational size small.

4.       As a startup, you often have to walk the tightrope between letting go of staff during crunch and carrying the few extra employees. Often, market dictates your moves, and through no fault of your own or for the matter the employee, tough decisions need to be taken. This leaves one vulnerable to expensive employee lawsuits. When you hire remote employees however, this ceases to be a challenge. Since the remote employee is geographically located in a different country, local labor laws do not apply. Plus, when you hire remote workers, you are technically paying for a service, in majority of the cases through another agency, which is responsible hiring and managing your remote employee/s. scaling your operations up or down, depending on the demand and your situation is very easy in this case.

 

The BUT’s and HOW TO

Nothing is perfect, except for maybe DiMaggio’s 56 game streak! Like every process and purported solutions, remote employees too come with their own unique set of challenges. However, happily, changes have been and are continually being made to overcome these challenges and make the process as smooth and as seamless as possible. The trick to overcoming most of the challenges lies in the process of selection of the right remote employee.

1.       Management and supervision- That’s the first challenge that comes to one’s mind is how will such an arrangement work? Most might not be too comfortable with the idea due to a lack of physical access and hence possibility of reduced supervision when you hire remote employees. Happily, with the massive strides we have made in cloud computing, it is equally easy to have access to your remote employee real time through tools like screen sharing, remote access and screen sharing. Supervision and mentorship of your employee can go on unfettered. Please make sure that such access is available with whichever agency you decide to go with and that you are able to hire a dedicated employee.

2.       Communication- Another challenge is to effectively communicate with your remote workers. Happily, most offshoring destinations can boast of excellent English speakers. Case in point, India lays claim to the second largest number of English speakers globally, after the United States. When you look to hire remote workers, it will be wise to choose them from regions known for its comfort with the English language, regions like India, Philippines etc.

3.       Having a say in talent selection- Most good staffing agencies will allow you to be directly part of the selection/hiring process. Insist it. When you hire a remote employee, insist on multiple resumes (remember, global outsourcing hotspots can easily give you multiple choices for the same position) and agree when you are absolutely satisfied. The best agencies will actually appreciate your involvement in the process.

 

Lastly, when you hire a dedicated remote employee, remember that you are always saving big in terms of money. It is thus prudent to look for as much value addition as possible; make the best of an available scenario. Offshore outsourcing has its challenges, but in terms of savings and access to talent, it is definitely advantageous to startups and small and medium enterprises.