Nearshoring refers to outsourcing business processes to a neighboring country, typically within the same or similar time zone. This approach offers several benefits and a few drawbacks.
Read more: The Right Way to Outsourcing Back-Office Operations: Navigating Vulnerabilities
Offshoring involves outsourcing business processes to a distant location, often in another continent. This strategy has its own set of advantages and challenges:
Know more: Charting the Course of Change: The Shift in BPM Job Roles and Skills
Nearshoring is when a company outsources its services to a neighboring or nearby country, usually with similar or close cultural and geographical proximity. Offshoring, on the other hand, involves outsourcing these services to a country that is geographically distant, often with a significant time zone difference.
In nearshoring, you delegate some of your business processes or operations to a nearby country. For example, a company in the United States may choose to nearshore its customer support to Mexico. This enables cost savings and operational efficiency while maintaining proximity for easier collaboration and reduced cultural and time zone differences.
In offshoring, you relocate business processes to a distant foreign country to take advantage of lower labor costs. For example, a software company in the United States may outsource their software development and programming projects to a team in India. This allows the company to reduce expenses while still accessing a skilled workforce.