Innovate or stagnate: how offshoring empowers organizations to embrace digital change

There is a lot to like about digital innovation. Technologies such as artificial intelligence (AI), robotic process automation (RPA) and the Internet of Things (IoT) are enhancing how organizations operate and helping deliver levels of customer experience that were once unimaginable. There is a reason global spending on digital transformation is tipped to reach $3.9 trillion by 20271 and that is because businesses know innovation is the key to staying ahead of competitors.

M_BlogT_How offshoring empowers organizations to embrace digital change

For all the positives though, there is one thing many business owners and managers do not like about the ongoing pursuit of digital transformation and that is finding the resources to do it properly. In a world where many organizations are struggling to dedicate enough time and money to their core services, the thought of developing and deploying a quality digital transformation strategy can be overwhelming to say the least.

It is no surprise Deloitte has found more than 50% of the average IT department’s budget is spent on maintenance and only 19% on investment2, while a Forrester study showed Chief Information Officers spend a mere 28% of their budgets on innovations compared to 72% on existing issues3. Given the critical need to stay ahead of the technological curve, such figures are clearly a concern.

The good news is there is a way for businesses to ease their existing workloads and dedicate more time and resources to the pursuit of digital innovation. The answer lies with outsourcing, which has long been a strategic enabler for organizations of all shapes and sizes and is now helping them drive their digital transformation initiatives.

What is digital transformation?

Digital transformation is the process of modernizing systems, products or services to enable businesses to better meet the wants, needs and desires of customers. Crucially, it is not about one single project or innovation. Rather, it is a long-term effort to use existing and emerging technologies to ensure an organization is constantly improving and changing.

Why companies choose to engage third-party vendors to support their digital transformation

Source: An Entrepreneur’s Guide on Outsourcing Digital Transformation (

The art of outsourcing in the digital age

In the modern outsourcing landscape, it is possible to assign almost any business task to an external provider. This includes tech-specific roles, with some organizations choosing to allocate their entire digital transformation efforts to third parties. While appealing, this can be a cost-restrictive exercise, particularly for small to medium-sized businesses with finite resources.

A more attractive option for many organizations is using the power of outsourcing to free up time for local teams to focus on digital transformation strategies. This is especially important when you consider that the digital transformation failure rate is as high as 84%, according to respected business publication Forbes4.

The list of tasks that can be expertly managed by offshore providers is almost endless and creates an opportunity to improve efficiencies, ease the load on onshore staff and save vital financial resources. Crucially, those benefits can, in turn, be used to supercharge one’s digital transformation efforts.

What are the benefits of outsourcing in the digital era?

There are countless reasons that businesses are choosing to outsource tasks in their pursuit of digital transformation excellence.

  • Enhanced productivity: 

    one of the keys to any business transformation is getting the most out of your people and it is no different with digital innovation. Outsourcing time-consuming and repetitive administrative tasks to hard-working and highly qualified offshore workers has consistently been shown to deliver productivity gains for those specific tasks, while allowing onshore staff to focus on responsibilities they are more passionate about. This leads to enhanced productivity across the board and more time to be spent on pursuing digital gains.

  • Access to talent: 

    the labor market has never been tighter for many industries, which is why it makes sense to open the door to offshore recruits. Outsourcing hotspots such as the Philippines take pride in nurturing quality talent pools that provide an abundance of knowledge and experience that may be increasingly difficult to access locally. From customer support and HR specialists to an array of administrative staff, offshore providers take many of the headaches out of recruitment.

  • Sustainable growth: 

    did you know labor costs in the Philippines are up to 70% lower than in Western nations? Now picture how those financial savings could be invested in amplifying a business’s commitment to digital transformation. Outsourcing even a few tasks and roles delivers significant labor and infrastructure savings that can be reallocated to more important work such as technological innovation.

  • Focus on core tasks: 

    how often do you wish you or your teams could spend more time on strategic priorities instead of run-of-the-mill tasks? There are few bigger strategic priorities these days than digital transformation and partnering with quality outsourcing providers allows businesses to offload routine tasks and invest more time on driving game-changing initiatives. Better still, it promotes a culture of ongoing innovation.

  • Scalability: 

    digital transformation requires different energies at different times, which makes the flexibility of outsourcing all the more appealing. Offshore providers make it simple and cost-effective to scale operations up or down depending on one’s current and future needs.

Digital transformation benefits



Source: Digital Transformation Strategies & Benefits (

How do you overcome outsourcing challenges in the digital era?

The benefits of outsourcing far outweigh any challenges that may be encountered. Better still, those challenges can be overcome with a little foresight.

  • Lack of control: 

    it is understandable that some business owners and managers may have concerns about ‘letting go’ of certain tasks but quality outsourcing providers have systems in place to ensure clear definition around roles and responsibilities. Along with stating who has control for what in the outsourcing contract, efforts should be made to develop clear lines of communication so in-house and offshore colleagues can quickly address any concerns.

  • Cultural differences: 

    partnering with an offshore provider typically involves working with teams or staff from another culture, which can be both exciting and daunting. The key is to research the cultural norms, values and communication styles before signing any deals as this will go a long way to building a foundation of trust and avoiding any cultural hurdles. For example, many Western firms choose to team with Filipino outsourcing providers as the nation is home to tens of millions of English speakers and is culturally aligned to the United States due to historical ties.

  • Data security: 

    it does not matter if a business is outsourcing a handful of administrative tasks or an entire digital transformation project, data security should be of the highest priority. Working with offshore teams typically necessitates the sharing of sensitive and private information but that is no reason to forgo the benefits of outsourcing. This challenge can be overcome by only working with reputable providers that have stringent data security protocols and signing legally binding documents that address non-disclosure and risk mitigation.

What tasks can be outsourced in the digital age?

How long is a piece of string? The wide array of benefits to be gained by outsourcing means that any task assigned to an offshore provider can positively impact one’s digital transformation strategy, be it tech specific or back-office support. Examples include:


With the tech revolution showing no signs of abating, it is essential for businesses to increasingly focus on developing, deploying and fine-tuning their digital transformation strategies. That can be easier said than done amid competing priorities, which is why so many owners and managers are grateful for the opportunity to outsource certain tasks to offshore experts.

Offshoring is an attractive option for improving efficiencies but not all countries are equally suitable. Discover nine reasons the Philippines is leading the way for outsourcing excellence.