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The Agility Podcast: Offshore Staffing Helped Me and it Can Help You Too!

Agility founder and CEO Rob Brough tells the story of how he saved his US business through offshoring company roles.

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Below is a transcript of The Agility Podcast Episode 1 with Agility Manager Nia and CEO Robert Brough.

00:00:32

Nia: Hi, I’m Nia from Agility Staffing Services. We’re here to learn how one businessman leveraged offshore remote staffing to sustain his business through difficult challenges. I would like to welcome Rob, our CEO, who I will be interviewing today.

00:00:52

Rob: Thank you. Looking forward to talking with you.

00:00:55

So, you have such an interesting story about how you started remote staffing. Can you start telling me how you ended up here?

00:01:02

Rob: Yes. Before I get into the story, there are two things that drive remote staffing or the need for remote staffing. And the first is trying to find great people so that you can grow and maintain your business. It’s really difficult. It’s got more difficult over the years, you know, with full employment. And the second is trying to get more margin. Sometimes businesses come and it’s, you know, really extreme margin pressure. And the only thing you can do, because people costs are the biggest cost of a business, is to go offshore with remote staffing. And both of those things have happened to me. So, I had a big healthcare company based in Los Angeles. We had six accountants, and the accounts just keep turning over, and it was really hard getting stability. And then the other thing was, I wanted to build a team for a website that went along with our business, selling non-reimbursable items to our patients. And that was also nearly impossible trying to build a team in the US. So, I came to the Philippines, and I built out two teams that were very successful. And then a little later on the business suffered a massive margin squeeze. Our reimbursements dropped by 47% and we had a 17% EBITDA margin. So, you don’t need to be a math whiz to work that out. You’ve got a problem. So I then started transferring jobs from my Patient Services, Patient Care, and Revenue Cycle Management areas to the Philippines. And in the first year, we saved $4 million a year. On the second year, we saved $6 million. It was a huge deal for the business at the time.

00:02:38

Is there anything compelling you think separates Agility Healthscope from its competitors?

00:02:43

Rob: I think just building on the last question, the fact that I came and did this for myself, I think it makes a big difference. Most companies don’t start like that. And so I really know what works. And I really understand how to transfer jobs from the US to the Philippines successfully. There’s no silver bullet, but I’m able to help people, especially people who have tried it and failed, or people or brand new to remote staffing and need some guidance. And I like to work with all of my clients in order to make sure they’re successful. The second thing is we work to ISO standards, so we have a very high quality operation. We do documentation, extensive documentation for our clients. Over the first six weeks or so as they’re being trained, my QA people sit in, we write up detailed documentation so that we can take that training burden away from the client as they start adding staff. And that makes a big difference as well.

00:03:46

So why did you choose the Philippines?

00:03:48

Rob: Well, honestly, to start with, I was looking for somewhere that was just one flight away from the US. I was still living in LA at the time. I later moved out to Las Vegas. But as I researched, I found that the Philippines has had a massive industry already existing, so I wasn’t going to be a pioneer. And I’ve quite often said to potential clients, healthcare clients, look, the US insurance companies have been in the Philippines for a very long time, way before I started. They’ve been using great people at a much lower cost to the US. Small healthcare businesses in the US have had to compete against that which is kind of crazy. I found there was about 1.2 million people already engaged in the general business process outsourcing industry in the Philippines, 75% working for US companies, which means they’re working at night. Again, there’s no there’s not a big risk here because you’ve got such a large number of people that have already engaged with night time work and a whole bunch of services have grown to support the way offices work. Restaurants and other businesses that are open basically 24/7. So you go to some of these places where there are a lot of offices, like ours, and at night time there’s many, many people, many thousands of people milling around which is quite surprising to anyone who’s, who’s not used to seeing that. And the second point is Filipinos have great English, just as a general rule. Some have slight American accents. Generally, it’s a slight Filipino accent that I certainly recognize when I’m on the phone. That’s a real boon because not many other countries can offer that. Filipinos learn English in school, it’s taught as a second language and that’s pretty important. But the most important thing to me is, subject to being treated well, like anywhere, Filipinos really care and want to come to work. They want to do a good job. If they’re being taken care of. There’s no employer that is not going to be absolutely ecstatic about the way that Filipinos work. It’s a really big deal.

00:06:10

So how did you find the performance of your employees once you started here?

00:06:15

Rob: Well, it was exactly as I researched, the work ethic is fantastic. The people are fantastic. I just love all my staff. I made a very family kind of operation, very Filipino style, but an American sort of office as well, casual. I don’t line people up, like many BPOs, where you have to push a little button in order to ask to go to the bathroom or anything crazy like that. It’s a normal American workplace, with a lot of little added extras that I want to make people feel like they’ve got a real home. And. And there are various ways of doing that which I’m sure we’ll touch on as we as we progress through the interview. The other issue is, especially in healthcare, it makes a huge difference. Filipinos are very empathetic. They really relate to people. I can’t tell you the number of positive phone calls that we had in, that our clients now still get, from patients who are calling in with complimentary things to say about our staff. It takes a lot for people to pick up the phone to make a complimentary call, whereas they complain very quickly. So, it really makes me happy to see this on a continual basis. And we reward that. The other thing is not just the quality of the work that the Filipinos do, but the productivity is also outstanding. It’s one of the issues that a lot of people ask about when they are looking to get into remote staffing, is can a Filipino really do the same job as an American? And I always chuckle inside because there’s obviously something going on about people thinking Filipinos just aren’t as capable. And that is just absolute rubbish. Every single Filipino that we employ has at least one university degree and some more. College educated, good English, great work ethic. What I see is about 25% of people give them three months. But certainly, even after a month, their productivity numbers are 20 to 25% more than the US team. So, I think that pretty comprehensively answers that question that, yeah, they’re great.

00:08:39

Are there any secrets to making the transition to the Philippines a success for many?

00:08:46

Rob: The first one is having a real commitment of the business to the program to either move jobs to the Philippines or start adding staff in the Philippines to supplement the US staff. Without the commitment of the whole business, it’s very, very difficult. When I say that, I mean the C-suite or the owner of the business, the CEO, the management team and the employees of the business have been properly educated on “why.” So that they understand what the business is doing and how each team can work together to become one team. The next is choosing a provider. The biggest mistake that you can make, choosing a provider, is choosing a provider only on price. If you go chasing every last dollar, there’s an old adage that you get what you pay for. And there are some things I’ll address shortly about this, but the big issue is to look for the churn rates. The lower the price, the less people are getting paid, the less that can be put into providing a great work environment for staff and rewarding staff. And that means people will churn out, they will look for another job. And that’s not what a business wants either. I don’t want that in my business, and I certainly don’t want that for my clients. You have to find a happy medium of a level that you’ve still got a really big saving, but you’re not chasing every last dollar. Our churn rates are around 2%, and that’s really good. Any single digit churn rate is great. The big BPOs, they suffer. 40%+ churn rates. Simply because most of their contracts are with giant companies that are chasing to save every cent, which means they can’t pay people as well. They can’t train people as well. They do their best. But, it’s not a great user experience. You’ll hear when many people call their cable company or call their phone company and they complain like hell, or they get so frustrated. And it’s simply because the people aren’t trained. They don’t know what to say. And if you half know what you’re doing, you know, that’s 20 questions down their list. They’ve got to go through every question to get to the area that you actually want to ask a question on in order to give you an answer. Hopefully that will change with AI, but that’s the way it is right now. 

If you are actually moving jobs, if you’re chasing margin, I recommend you keep 20% of your staff ultimately in the US. I recommend you start small, start with a pilot. Let’s say you had 100 people. I’d recommend no more than 80 of those people would be moved to the Philippines. Start with a pilot or 5 or 10 in the area that is the biggest pain point for you, and then build out from there, get some experience, get the team settled, make sure that you’re happy with your vendor, and then you can start adding people at quite a clip. And at the same time, make sure that the 20 people that you’re keeping in the US are your employee experts. Your more senior managers, perhaps. And they become the trainers for those people in the Philippines so that you’re managing the institutional knowledge, if you like, keeping that alive rather than throwing everyone offshore, which I don’t think is a good plan. That’s exactly what I did when I engaged in doing this for myself. So you’ll find pretty quickly, within three months, potential leaders will be poking up on your team as you’re adding people. We like to recognize outstanding performance. And we provide leadership training. So those outstanding performers, if they have the leadership capability, we like to see them promoted into Team Lead positions. Later on, as the whole team grows, they can grow to be Operational Managers, QA managers and so forth. So it is possible to grow your team and grow that knowledge and create managers offshore to supplement your onshore management at the same time. My big clients are able to do that. And I got asked this question just the other day by somebody who said, well, shall we send a full time manager there? And I said, no, there’s no need. If they come and train, they go home, they can manage. The team will identify leaders. As we’re growing the team, they’re looking for 100 to 120 people. And as that team grows so will your offshore managers. And there’ll be no charge to you, as you’re growing the team, we just build that into what we do. 

The next point near is training. I strongly advocate for my clients to send trainers from the US to train their team. You get so much out of that. I think it can be penny-wise and pound-foolish if say like “Well, that’s going to cost me, you know, $6000 or $7000, and I don’t want to do that.” But if you send that person and they train their team, that interaction with the team binds the team to that manager and that trainer. And they will understand the idiosyncrasies of everybody. Where the strengths and weaknesses lie in your team. We’re dealing with human beings here, that lasts and the relationship just goes on. It doesn’t come to a halt when you leave. Now, I’ve got lots of clients who are trained remotely. We brought clients on over Covid where we had everyone working from home. It all worked. But this is the way I did it. I wanted to make sure that what I did was a success. And I still strongly believe in this, and I still advocate the strongly to every client. 

And finally, Nia, you have to make sure you mold your people into one team. You don’t want a sort of a “them” vs “us” cropping up. There are lots of little things you do to do that. I think having that interaction with the trainer who’s visited the Philippines helps because they go back so impressed. And that word spreads. Also, we like to see everyone in uniform. I don’t think we have a client that doesn’t have a uniform. So we give all of our staff uniforms and we co-brand them, same as our lanyards, with our RFID access cards to a building. They’re all co-branded with a client’s brand on our brand so that the our team members who work for the client feel like they work for the client. They don’t just work for us. They work for the client. They feel part of the team. Lots of other things you can do. One quite powerful if you’ve got enough people, is put up cameras in your office and our office. We’ll put them up on a big TV screen or 2 or 3, whatever you need, depending on the size of your team, and let people see each other working in real time. Again, that’s something I did when I did this. And it works, you know, it truly works. And because I did 120 people pretty quickly so many of my trainers were coming over and then going back to the US and talking so positively as they’re engaging with their team. Then they can see those people working. They’re listening to conversations. They’re all end up on conversations together as you do. And when you have team meetings it really brings people together so well.

00:16:32

You talked about the importance of having low churn. Why does the price of service affect churn?

00:16:39

Rob: It really is based on what people cost. You need to pay people well and you need to be able to provide a good environment and engage with them effectively, and that costs money. Our starting salary is about double, or slightly more than double the large BPO salary. And that’s the first thing, but more importantly, we like to recognize people and we like to engage with people. I have a full time Employee Engagement Manager, and that’s all he does. We’re able to recognize great service to the clients’ patients and customers immediately. We have weekly rewards, monthly rewards, and quarterly rewards. We also have a massive kickoff party every year where we recognize the top achievers for the year. It brings everyone together and provides that feeling of having a home. The other big difference is we employ people as full-time employees. We do not put them on contracts. Again, most big BPOs operate on contracts where the client signs a contract for two years or three years and the people employed for the client are signed to a contract of the same term. That limits liability for the employer. The Philippines labor law is pretty tough. It’s a little like California or New York. Um, there’s quite a bit of contingent liability employing people full time. But when you give someone a full-time job, they know they’ve got a home. They know that we believe in them and we believe in our business. And I think that’s important. So we’re not just recognizing people, but making sure that people feel like they’ve got a home and that is really important. We follow Philippines labor law very strictly. It’s important to me that we do the right thing by our people. It’s not just a matter of following the law. There are many companies that do not. In the Philippines, I’m not saying specifically with BPO businesses, but just generally there’s a lot of wage theft. The cost of employing someone on a full-time basis is quite high. So, for instance, there’s a 10% load for working nightshift. There’s about a 20% load for all the different employment taxes. Social security is 15% alone. That’s quite a high cost. We provide everyone a HMO plan for them and their immediate family, which is quite expensive. We have the best hospitals in the Philippines on that list. Also under the Philippine labor law everyone must get paid what they call 13th month pay, which is a mandated bonus paid in December of a full month’s pay. And there are other things. It goes on and on. So, there’s a lot of extra cost and whatever the base salary is, by the time you add in your operating cost is about double the salary. That can change of course depending on how you operate. But that’s how we operate. And the final point near is, I talked earlier about contracts. The negative side of putting people on contracts for the client is the employees don’t work all the way up to the end of their contract and just wait to be renewed. No, six months before it ends, they’re out looking for another job, and they’ve got other jobs that they’ve accepted before their contract ends. That’s ruinous for the client if they wants to reengage for another period because you’ve lost all of that institutional knowledge, and the relationships those employees have with your stakeholders, whether they be other staff in the office, or your customers, patients, doctors, doctor offices or hospitals. So, dealing with contract staff is not something that I would do. I think it hurts clients.

00:20:41

Can you explain the no risk approach we offer our clients?

00:20:45

Rob: It’s tough to be looking to engage in remote offshore staffing for the first time, people don’t know who to choose. There are a lot of vendors out there. So how do you choose somebody? A lot of companies say the same thing. I like to offer a risk-free approach to build that trust between us and the client. And in that way, you can “walk the walk”. It’s not just talk. Everyone can talk, but it’s delivery that matters. My approach is to ensure that I can build trust very quickly with the client and then go on to build out the relationship for the long term. One of the ways we do that is to offer the client a contract that has no fixed term in it, so the client can sever the relationship with us any time. And why would I want a relationship with a client if I was leading that client down? I wouldn’t want that kind of relationship. So by doing this it gives the client some peace. All we ask is that because we’re hiring people full time, and we have to pay, if we terminate them without cause, we have to pay a month’s severance for each year or part thereof that work. We ask the client to pay that. But we also say to the client, look, if you give us three months, we’ll use our best efforts to move those staff to another account. So, one of the things that we do is we do keep all of the staff on the client’s account for the life of the engagement. We won’t move people unless the client says, look we need ten less people. We want to finish the relationship. It’s never happened to me, but I’m sure it’ll happen one day. So that’s what we offer. And with our contract, we only ask one simple thing. During the recruiting process, you give us specific information about the people you’re looking for. We’ll go out recruiting, we’ll present them to you. You can interview them if you wish, and if you don’t wish to, then we’re very capable of selecting the right people. And then we’ll want to make sure that you have signed the contract before we move on and legally employ those people. We ask that you respond to us in two business days, that we both respond to each other, not just one way, in two business days throughout that recruiting process, because people are looking at multiple companies for work and they’ll move on to another job if there’s any sort of any lapse in the movement of getting hired. That’s pretty critical.

00:23:26

Rob, can you explain how billing works?

00:23:29

Rob: Well, it’s really simple. We have a single cost per employee per month. We don’t charge any upfront fees whatsoever. No recruiting fees, no upfront deposit. We want to build trust with our client and all we do is invoice the client at the start of the month the employees start working, and we asked to be paid at the end of that calendar month. It’s a pretty simple process now in the monthly charge that includes everything. So we’re obviously providing the office, the equipment for the people to work, all of the systems are set up so that they can connect seamlessly and in a secure way to the client systems. We do collect the credentials for all the systems like VoIP and email, cloud-based software systems. Out IT Department works with clients to make sure that all the staff are set up before they actually need to start work.

00:24:33

What hours do the employees work for the clients?

00:24:36

Rob: Firstly, the staff work 40 hours a week. They work at the clients’ hours. So whatever the client sets, if the clients are in the West Coast of the US, they’ll work Pacific Time. If they’re on the East Coast, they’ll work Eastern. Sometimes we have big clients that have staffing needs across the whole country, and they’ll work the various time zones that they are set. The second point is they work all business days of the client. For our US clients, and that’s the majority of them, that’s every business day the business works. If that is a holiday in the Philippines, they work that holiday. Now we have about 30 holidays in the Philippines a year in the US, a very small handful that businesses actually take. So we pay the penalty rates. That’s another sort of load on the salary that I didn’t mention earlier on. We pay the penalty rate. And then the staff will have any US holidays off, and there aren’t many of them. Memorial Day, um, Independence Day. There’s a couple of the same like Christmas Day, of course, New Year’s Day. There’s not many of those, but they have those days off and don’t get paid. So that’s the way that we work, how the staff are rostered.

00:25:53

You’ve talked about the employees working in the office. Can they work from home?

00:25:58

Rob: Yeah, sure. Look, it’s totally up to the client with health care. I really like the staff working in the office. We operate to strict HIPAA and HiTECH compliance. It’s a lot more difficult or probably impossible to monitor that from home. But there are some tasks that don’t impact that so much. We definitely have quite a number of people working from home where the client has been happy for them to do so.

00:26:25

So what kind of roles can be transferred offshore since Covid?

00:26:31

Rob: It’s much easier to explain because that’s a question I get asked a lot by people that are looking at this. Anyone who could work at home during Covid, that’s a role that can be remotely done offshore. And it’s a very wide range of roles. It’s only jobs where people have to physically touch a patient, physically touch a customer that aren’t able to be moved offshore. Again, I would like to see at least 20% of staff kept onshore no matter what. I think that’s just a safe and proper thing to do. You don’t want to have people training someone offshore and they lose their job onshore. I think that’s horrendous. With that in mind, Patient Services roles, everything from reception, to coordinating service with a patient, to coordinating with a doctor’s office to Patient Care roles where we had people doing remote work with patients on video and phone, all the way through to Revenue Cycle Management, where we’re managing every element offshore. In a more general sense, just about anything, you know, graphic design and all kinds of marketing roles. There’s great talent in the Philippines in this area. People with pay per click knowledge and managing Amazon stores. If you can think of it, it’s all here. There are experienced people here who have those skills. I’ve got to say, now, there’s been a lot of people scooped up into pretty serious roles. Full stack developers all the way through to network engineers, great HR people, accounting. As I told you, I started here with accounting. It’s such a wide area and the simplest way to think of it, is could this person do this job during Covid when everyone had to work from home? And if the answer is yes, that’s a job that could be put offshore. It’s as simple as that.

00:28:42

Nia: Thank you sir Rob. That has been Healthscope Agility Principal Founder and CEO Robert Brough. We hope you’ve picked up some great insights on offshore remote staffing. If you’d like to learn more, visit our website. See you in our next podcast.