Combining elements of Corporate Social Responsibility (CSR) and more standard outsourcing, the process of impact sourcing has enormous potential to impact both disadvantaged communities and global markets. It’s no surprise that it’s been seeing growing popularity recently, now making up an estimated 12% of all outsourcing.
However, not all impact sourcing is created equal. The way in which companies approach building an outsourcing presence has an enormous effect on the longer-term results of such policies.
Below, we explore just what impact sourcing is and how companies like Tek Experts are using it to effect real change for communities and customers alike.
What Is Impact Sourcing?
At its most basic level, impact sourcing is the process of outsourcing business services to people from disadvantaged communities. Originating in India as a way to move some outsourcing functions from increasingly expensive cities to more rural regions, impact sourcing began as another way to utilize unsaturated markets with a high supply of talent but low demand for it.
On occasion, impact sourcing can be a type of greenfielding, where companies outsource to regions which haven’t hosted such businesses in the past. Both impact sourcing and greenfielding can help underdeveloped communities create more high-skill and high-paying jobs, helping to bridge the digital divide.
So, what differentiates impact sourcing from standard outsourcing? It needs to have community and individual development as primary goals. This frequently requires job training to upskill community members for their career roles.
Ultimately, true impact sourcing must be a two-way street in which hires provide value for their employers while those employers provide valuable career development and economic opportunities to those individuals and their communities. Organizations like the Global Impact Sourcing Coalition (GISC) have also been created in recent years to help ensure standards for impact sourcing are upheld.
The Advantages of Impact Sourcing
The real benefits go far beyond simple savings because the targeted communities generally have access to fewer opportunities, therefore retention and loyalty numbers tend to be high. GISC estimates that impact sourcing has attrition rates 15-40% lower than traditional outsourcing.
Other business drivers cited by outsourcing organizations surveyed by the Everest Group include:
- Accessing new sources of talent
- Generating a positive social impact for workers, families, and communities
- Creating a more stable workforce
Impact sourcing workers are also more committed and motivated – a view shared by 69% of surveyed outsourcing organizations.
That said, this advantage further points to the importance of ensuring these hires are offered quality skill development and career paths within the organization. The CSR element of impact sourcing points to how that loyalty should be earned via these kinds of investments.
There’s also the reality that impact sourcing enables companies to access large and untapped talent pools. Often these will be in places where strategic languages are spoken. For example, impact sourcing often utilizes English skills in places like Rwanda and Nigeria.
Lastly, while impact sourcing is relatively new, it has already proven its ability to provide real value. Companies like Tek Experts have found tremendous success in the practice and are increasing their use of impact sourcing as a result.
Impact Sourcing Narrowing the Skills Gap
The employment practice has developed a circular economy across African outsourcing locations. In essence, by going to locations and developing the skills required, a sustainable business and job opportunity ecosystem is created.
Outsourcing organizations no longer have to cherry-pick people with the applicable skills. By training people with those skills instead, feedback into where a skills gap needs to be plugged can be effectively communicated and addressed.
As part of this feedback loop, bespoke digital skills training is required to bridge gaps in key competencies. A case study featured in our recent talent and skilling whitepaper showed the partnership between Harambee, an employment accelerator initiative, and Tek Experts, upskilling hundreds of tech support workers in an impact sourcing location. As a result of providing a new talent pipeline, that unit’s performance improved dramatically, becoming the best in just 18 months.
How Tek Experts Is Doing Impact Sourcing Differently
While the standard impact sourcing process of outsourcing the lowest level tasks has its place, Tek Experts has taken a different approach. By opening up large technical service centers and leveraging the digital skilling experience of our partner elev8, Tek Experts is actually upskilling people to perform higher-level tasks than usually found in impact sourcing projects.
The difference is largely in the long-term impact of these activities. By giving people access to training and a career path, Tek Experts is providing more than just jobs. We are providing thousands of well-paid careers to areas where those opportunities can transform not just individual lives but entire communities.
Data and our experience show that investing in digital skills creates happier, more loyal, and more effective individuals. That’s why we’re continuing to make large investments in new training and development centers in places like Rwanda, Costa Rica, Vietnam, and more. Unlocking the potential of these communities and delivering even better value for our customers has shown us why impact sourcing is a key strategy for the future success of Tek Experts.
Of course, successful impact sourcing also relies on effective talent and skill development. Fortunately, we recently put out a whitepaper on how we’ve successfully nurtured the skills needed to create effective IT services and support teams around the world. Check it out.