Just to give you a bit of background about myself. I'm an American and I have personally been to India and the Philippines and seen the outsourcing offices I've dealt with first hand from several different companies. I've also hired from both India and the Philippines. Here is what I've learned to hopefully save you the hassle of making many of the same mistakes.
- Costs for a programmer in both countries are relatively the same. Meaning a $1000 a month expert programmer in India will be a $1000 a month expert programmer in the Philippines.
- Every outsourcing company differs in the way they hire staff for you. Most commonly an outsourcing company will have an HR staff that will look at applications and then have you interview people, while others already have programmers on call ready to go at any time. If you want a long-term solution ONLY go with companies that are willing to reach out into the job market and find someone specific to your needs. I've never had a good experience in using someone that was already on staff ready to go. Secondly, make sure it's easy to hire and fire somebody. Nothing is worse than having a contract for 6 months with someone you can't use.
- Payment structure. Make sure the outsourcing company you deal with is OPEN with you about payment structure. Some companies will charge you $2000 for an expert programmer which they are only paying $500 for. All good outsourcing companies will generally have a payment structure where you pay a flat fee on top of the person you outsourced's salary. This structure gives you the ability to give your staff raises and bonuses without the outsourcing company taking a part of the bonus or raise since the flat fee always remains the same. This can have it's ups and downs. For instance a $500 content writer will cost you $1100.
- The Philippines has something called a 13th month bonus (it's like a Christmas bonus). Not all outsourcing companies will require it, but it's a custom you should be prepared for. Again talk w/ the outsourcing company you work with to see what sort of expectations you may be asked to fulfill. Things like holidays/time-off and 13th month payments can eat away at your budget if you aren't expecting them.
Now the differences between staff in the Philippines and India that I've noticed.
- You can find equivalently skilled staff in both Philippines and India in any area. From designers to programmers. The biggest problem you'll run into is going to be understanding western ideas and culture. Although this stereotyping isn't true for all Indians or Filipinos, this is the majority of what I've seen from both. Sorry if you consider it offensive.
The one major thing that finally swayed me to let all my Indian staff go and only work with Filipinos was this. In this ad industry cultural differences can be a huge killer. Basically if someone doesn't understand your product or idea, how can you expect them to create software or ads for your target market. You can't.
If you've been to India, or even looked at a picture, it's vastly different from America. Many animals are sacred, cows lay in the roads and people just drive around them, advertising is completely different, the movie scene is completely different, clothing is completely different, and drinking alcohol is still somewhat taboo. It's a very conservative culture and almost nothing like western culture.
Now, look at a picture of modern day Manila. Although it's still not like being in the states it's not that far off. You see billboards that are similar to American ones, people wear similar clothes, drinking alcohol is definitely not a taboo, and English is an official language. Hell I've been to the rural areas like the Batad Rice Terraces in Northern Philippines and Dumaguete further south and still didn't have any problems finding English speakers.
What I'm trying to say is, Philippine culture is not that far off from American culture. I've had much more success explaining my ideas to Filipinos than Indians because they are more familiar with the ideas.
Now this doesn't mean their is never an exception. I've had great experiences with a 20 year old Indian designer who was amazing and understood my ideas extremely well.
My mistakes:
- My first time hiring I ran out of stuff for my employee to do. Make sure you're ready to bring on a full-time employee, don't just do it because you're making $30k a month right now and it's fun to tell someone what to do. You'll regret it when that $30k+ a month goes away
.
- When my employee would run out of work the company I hired the person through, would do other company projects behind my back. Essentially the company was having the person do other projects during the downtime where they had nothing to do. I'd tell the company so and so can go home early today (it was a friday) to which they replied they can't do that. What a joke (Indus Net Technologies btw). I've visited their offices and spoke to their CEO personally. They are overpriced and shit, and no one understood my ideas. I'm never using them again.
My recommendations:
- Remotestaff.com.au is a company I used to work with. CEO was a super nice guy (can't remember name). It's a Philippine outsourcing company but people work from home. I caught my guy cheating the system they have setup though and eventually let him go. It's a great concept and you can save on expenses but I found if you don't have the time to monitor your employees activities you can be throwing money away.
- Microsourcing.com is the only company I work with now. Absolutely best company I've dealt with. I've met the CEO and toured their Quezon/Manila offices, beautiful place in a great safe tech complex even the most nervous of nervous travellers wouldn't be afraid to stay in. When I showed up their must have been 15 people waiting in the lobby to be interviewed. Every employee gets a LCD monitor, 24 inches I think. Something you don't see in any of those makeshift Indian outsourcing operations. They charge $575 flat fee for their employees + whatever the employee's salary is (they may have raised or lowered prices recently, not sure). Their fee includes the obvious things like a computer, place to work, etc. but also includes healthcare so you don't have to feel like too much like a slavedriver. They have a great HR and BOT (build-operate-transfer) program too if your company grows and you want to move team away from microsourcing. If you message me I can put you directly in contact w/ their CEO.