February 26, 2018
Neville Samuels – Virtual Staffing fortifying Outsourcing
February 26, 2018
Derek is joined by Neville Samuels of VirtualStaff365 for the second time. They will discuss Neville’s company and how they help their clients. They will also discuss what Neville believe is the best approach to outsourcing.
- Neville is a qualified accountant and he’s had a number of successful businesses and he is currently running VirtualStaff365.
- VirtualStaff365 helps businesses recruit, onboard and retain virtual assistants. The VAs are usually based in the Philippines and usually, they work from home.
- They discussed the difference between VirtualStaff365 and a BPO, including its Pros (cost) and Cons (managing the team)
- They also discussed the success and failure rate of VirtualStaff365 plus the factors that can affect the success rate of the initial phase of outsourcing.
- According to Neville, the number one challenge for VirtualStaff365 is client education.
- The real difference between VirtualStaff365 and a BPO is they don’t have any set premises in any particular area in the Philippines or anywhere else. Their staff work from home.
- Pros and Cons:
- Pros is the cost.
- Cons is that it’s harder to manage four or five people working in different places than it is if they’re all in one office.
- You don’t necessarily get higher productivity from employees working in a BPO office compared to people working from home.
- The number one challenge for VirtualStaff365 is client education.
- Two reasons to suggest BPO:
- Data Security
- Two reasons why the initial phase of outsourcing may not work for a client:
- Recruitment of the wrong person
- The client is not able to train the hired personnel
TranscriptRead Full Transcript
Welcome to another episode of the Outsource Accelerator podcast. My name as always is Derek Gallimore and this is episode number 122. Today I am joined by Neville Samuels again. He first joined us in Episode 119. So if you haven’t heard that go back and listen to that episode because it introduces Neville and his business background and how he became involved in outsourcing. But you know as always this is an independent episode and you’ll get a look from this one anyway. Today we discuss Neville’s company which is VirtualStaff365 and I dig under the bonnet a little bit under the covers. And see what it’s all about and see how he helps people and see what he believes is the best approach to outsourcing so there’s a lot of value here for you I’m sure. If you want to get any of the show notes or get in touch with Neville go to outsourceaccelerator.com/122.Enjoy
Derek: Hi and welcome back everybody. Today I’m lucky again to be joined by Neville Samuels. Hi, Neville.
Neville: Hi Derek. Hello listeners.
Derek: Today we are, we spoke to Neville previously in a previous episode and we kind of looked into his background. He’s a qualified accountant and he’s had a number of successful businesses now and now running VirtualStaff365. So I want to hear more from Neville today about VirtualStaff365 and this isn’t because it’s an infomercial or anything but I really think that the more businesses surrounding outsourcing and feeding into outsourcing will really help the proliferation of outsourcing and certainly Neville with VirtualStaff365 plays an important and critical role in that. So thank you for joining us Neville and would you I suppose just want to give us a brief introduction to yourself and your company.
Neville: Sure, I’m the founder of VirtualStaff365 which as the name suggests we help businesses recruit onboard and retain virtual assistants, are usually based in the Philippines and usually they work from home. When someone asked me what I do or say help businesses get their time back so they can work on the things that will make their business grow if that’s what they want to be doing.
Derek: Right and what I’m really interested in the initial stepping stones I want everyone to start outsourcing or try outsourcing. What is the difference with and a BPO and some of the other services out there?
Neville: Right, so okay, the real difference between us and a BPO is we don’t have any set premises in any particular area in the Philippines or anywhere else. Our staff work from home. Usually we join the pool of candidates with a pool of outsourced workers that have been working in BPOs which are essentially offices outsourced offices with infrastructure. A lot of the candidates that we recruit all that apply for jobs with us come out of that industry and then might have been in this industry. Typically I see it between anywhere between 3 and 10 years and they’re tired of the travel. To be honest a lot of them are tired of travel in and out of Manila. Two to three hours in one direction. They loved working in the outsourcing industry but they just want to work from home and spend more time with their family. Now the offering is very different because when someone’s working from home you don’t necessarily get the same visibility as you do when someone’s working in an office when you know that they’re accountable to everyone in that office. So what we do is we bring that accountability we provide the visibility to our clients so they can actually see what their staff are doing when their staff are working from home. So and I suppose the obvious question is why do people use virtual staff working from home. Well the obvious thing is it’s cheaper. So you’re getting the same resource often you’re getting highly skilled highly talented resources. It’s not as expensive as staff working in a BPO. And with that there are pros and cons.
Derek: What are some of the pros and cons? So people working from home. It’s a huge amount people really isn’t it because it’s almost double of salary if you want to go into a BPO but with the BPO you effectively get all of the premises you know the infrastructure. A lot of HR Support Services obviously fast internet and a bit of a kind of culture and environment for them, for the people to feel comfortable in. But it almost doubles the cost of the person doesn’t it?
Neville: Well the one thing is the cost. That’s right it does increase the cost significantly. The real difference at the end of the day for the client that it’s very hard for them. To be honest I think it’s very hard for the client to tell the difference between the two especially if it’s an introduction to outsourcing for them. What I do see is my clients, if they grow once they start the first VA and then they take on another and then another over a period of time they might get to the point where we might suggest to them that then maybe start looking at using a BPO. Because at the end of the day while this is definitely cheaper it’s harder to manage four or five people working in different places than it is if they’re all in one office.
Derek: And how do you handle that transition then. Because I you know preach to SMEs that they really want to look at the strategy pretty hard before they start. Because if you start working with virtual staff or remote workers then it could be hard to aggregate them into an office if you want to later
Neville: Well they won’t. They won’t move.
Neville: Once they work from home they’re not going to move and we’ve actually had this. We’ve had this scenario and we’ve got it right now. The staff won’t move from home because they really enjoy. It gives them time with their family they work eight they’re working nine hours a day eight hours paid and one hour of breaks.
Neville: And I’ve got guys that are telling me they want to work for me because they’re currently working nine hour a day in Manila with three hours interval twice a 15 hour day.
Neville: And they’re not necessarily getting paid more. In fact often we, we pay more because we don’t provide a lot of the benefits that are provided by the BPO. The transition is generally when the client when we’ll sit down with a client and say I think it’s time you look at paying a little bit more and having a team work together. There are two reasons why we suggest a BPO. The one is teamwork and the other is data security. When someone’s working from home we can’t provide any level of data security and we would never suggest that we can.
Derek: Do you think you get higher productivity if people are sitting in an office do you really think that people do work hard when they’re sitting at home and are not distracted they maybe don’t sleep in a little bit.
Neville: I’ve seen I’ve actually seen results where people work in a BPO are less productive because of the people around them.
Neville: So the more people around them. And that’s just anecdotal of it’s not scientific. Then what we are able to do is we’re actually able to provide our clients with a certain amount of visibility of what we started doing. So we use software tools that allow the client to get timesheets that tell them exactly when the staff log in when they log out when they have breaks. Screenshots of what the staff are doing very similar to what you might see on some of these online freelancer systems. And so you know when something comes to me and I want someone for two hours work and I say go to Freelancer, go to oDesk, UpWork or whatever it’s called then and do it that way. And it’s a bit of a struggle because you’re dealing with 50 resumes from 100 different countries and the working relationship is a little bit different with us. Our clients have direct access to the staff. They are dealing with them throughout the day. They can see screenshots of what’s happening. Usually our clients are blown away with what they’re able to achieve using the VAs working from home and then we also work with BPOs. So if a client comes to us and says to us Neville, we we need help with a, we need a BPO. What are some of those? I’ve actually got a client that’s already in a BPO. He’s got a team working on a BPO and the team are not happy and he’s come to me to say can you help us find the right BPO.
Neville: And that’s where Accelerator comes in as well.
Derek: And it’s just, if people start with remote staffing or virtual then they want to transition into a BPO. Is it generally that you have to start again you shed the staff.
Neville: Well it was usually they don’t shed the staff. Usually they keep the staff and they start building a new team in a BPO.
Neville: Sometimes they can’t stomach the cost. They don’t actually see the value in the cost and they’ll say you know what Neville we will just work the way we are working because if they see it’s cheaper and it is working.
Derek: Right. Do you see? What is the success rates you see with because your at the very entry point of people’s outsourcing journey which I find super exciting. But I also find that if anything goes wrong you know if they maybe have someone that isn’t as enthusiastic or capable as they had hoped then you know instead of just finding someone new. They kind of blame it on the whole concept of actually saying they blame it on the Philippines and they kind of throw the whole baby out with the bathwater. What sort of success. And that’s why I find it so critical that people knew new people to outsourcing have early wins. And and it’s also super critical that the first staff member is super capable because otherwise they could just become despondent so quick. But what is your sort of success and failure rate like?
Neville: Well that’s a that’s a really good question because I because I’ve been working with my own VAs since 2009. When someone comes to me and I kinda take that in actual fact they’re not. It’s not going to be successful. I actually tell the clients straight up. I don’t think this is going to work and it usually comes around, it. There are two reasons why I find it doesn’t work in the initial phases. Either we recruited the wrong person or the client isn’t able to train them. Now in terms of recruiting the wrong person we don’t provide the client with one possible candidate. In some cases we’ll provide six or seven candidates that client interviews the client makes the selection. So we actually take a lot of the guesswork out of it. We do a fair amount of testing if we can to actually validate the person’s skills and make sure that they can actually do what they say they can do and the client sees that the clients involved in setting up the challenge. We do a simulation or a challenge or a little test whatever it might be. So to be honest we’ve been really successful on that front where we get looked down when the clients can’t spend the time training their staff member and probably the most recent one was about four months ago where a client took on a VA and they discovered that every day they were asking the person to do something different they have to train them on to something different. Then there was no repetition of the work that was being done so they could never say to her. Please do what you did yesterday because the tasks were different. And that doesn’t work so.
Derek: Because there’s no scalability in that, is there? You need, you need. There’s efficiency then when things are repetitive because you teach it once and it gets done but if you have to sit by someone. Although I imagine I mean there’s only an extent of tasks that this person would ever do. So maybe it might take six months as opposed to six days. But it’s. Yeah.
Neville: Well well you haven’t got that time, the client turned around and said we’re actually not as ready as we thought we were. We need someone but they probably need to be in the office. It’s just too hard. So that does happen. We do try and read it out before it starts. We had one client call us up saying they’d like us to find them a VA because they are on the road all the all time all the time every day. And I said well when are you going to train them and they said no we want the person hit the ground running. And that is when the red flag goes up if you want someone to hit the ground running and they sitting six thousand kilometers away from you it’s not going to work.
Derek: No. And equally I mean people have expectations of VAs and even any offshore staffing. And I think they kind of have expectations that are just unreal for any kind of employment scenario. You know if you hire someone new sitting in your office in your hometown you’ve got to spend time with them. They’ve got to guess you know you’ve got to ingratiate them to your company culture and your processes.
Neville: I actually think that’s our number one challenge. Our challenge is to educate our clients that taking on a VA or having a remote worker working your business doesn’t mean that they can do everything. And doesn’t mean that when you explain something to them they understand it. Very often then not and say yes because they’re actually, what they’re actually saying is I hear you. I’m listening to you. But it doesn’t mean that they actually understood everything you said or the repercussions of what you’re saying.
Neville: And I do say that’s the number one challenge that we have all the time. And what I say to my clients is you can’t just talk to them and expect them to acknowledge and then go and do the task. You’ve actually got to get them to do it in bite sized chunks.
Neville: So. And I learned this in our previous business you know e-commerce business my business partner would, would say to me Neville I asked Al Bell, he was one of the VAs to do whatever tonight. And I told him how to do it. And he said he understood and he completely stuffed it up a whole day’s works completely gone and he’s messed up everything. And I said to my client and his name is David I would say to him. Did you ever have a look at the work that Al Bell was doing to see that he was doing it correctly. And he would say to me no, I told him what to do and he said he understood it. So at no point in time did my partner actually say to him stop and show me what you’ve done.
Derek: Yes milestones.
Neville: Yeah little milestones and I call it I call it bite sized chunks. So what I say to all my clients is when you give your staff something to do. Tell him to do it once and to stop and send it back to you or stop and let you have a look at it and then not to go into the second do it a second time until you’ve had a look at it and approved it. Because if they haven’t understood it you’ll pick it up in the first one and if I get that right then go and do five. And they’ve got to stop and show you what the five look like. Once they have done the five and they you’re good with it then go and do ten. And so you build it up because what you’re doing at the same time is you building up their confidence in the work that they’re doing for you. And if they know they’re doing a good job for you they’re going to be more engaged and they are going to be more willing to do a good job for you tomorrow. So, it’s it’s a real it is a process and it’s a process of education with our clients. And I’d like to think that most of the time we get it right not always and some jobs
Derek: It’s businesses isn’t it?
Neville: And some jobs are just harder than that. Some jobs are not some sorta simple data entry.
Derek: Absolutely, yeah and the complexity increases with the complexity it almost kind of gets exponentially complex isn’t it? As not as complexity or variation rises but this is you know it’s interesting that you kind of dwell on this that a lot of the essence in success is not actually onboarding the virtual remote staff because they’re they’re super used to this whole thing but essentially. It’s kind of the onboarding and the coaching and the training of the employer or isn’t it? Because they actually just have to kind of they need to approach it differently to a normal employee environment and there’s a few tricks they have to learn and there’s a few processes. So you know in our activation consultation we also spend time with the business owner and emphasize that it actually requires a bit of learning from you. You know to to so that you can optimize the experience and get the best out of your team. It’s you know it’s not going to happen unless you invest time and effort. That’s that sort of process.
Neville: And companies like Telstra well they got teams that can actually do that they’ve got the resources but I’m not shy to tell a client that they have time to train or if they haven’t got staff that can be accountable for the training of their offshore staff then it’s just not going to work. So getting back to getting back to your original question. It is critical that we recruit the right people or give our clients the right choice of candidates and that where we need do what we do a great job of there. Even if I say so myself, we certainly made mistakes but by and large we do get that right. And we have a process of weeding people out and the process doesn’t start with me. It actually starts with my staff in the Philippines. So you’ve got to have processes to actually do that and a lot of VAs actually candidates fall by the wayside. Because we get through a process of interviews and a process of testing and then we put them forward to clients and very often I actually talked to I have a colleague who’s got his own team in the Philippines and he says Neville. For every five people that we give an interview to unlucky one comes to the interview. He just doesn’t have those processes so that that is important.
Derek: Yeah there is a bit of a sort of flake environment isn’t there in the Philippines and you know this is where I think you will without even trying you’re demonstrating your immense value to potential clients because it’s not just, I don’t know find a virtual staff it’s actually sort of all of the inherent business experience that you have. But also the kind of hands on and real life experience you have in running outsourced teams but then also you’re filtering processes when finding suitable candidates and also the kind of the guidance that you’re actually giving the clients you know. Like kind of pushing them down the right path and so that they’re following the processes so that they’re getting the results that they expected. You know and and this is why I think there’s huge in the partnerships within outsourcing. So there’s you, this sort of brokerage virtual staff find a bit also in the BPOs. Because just generally it’s not just about putting bums on seats. It’s actually the immense kind of business knowledge that comes with these partnerships. Can you give us an overview of your costs how you charge. What is the pricing structure and also maybe an indication of what it cost for people to get started with the V.A?
Neville: Right. So we don’t have any set up fees or recruitment costs squarely upfront fees. Essentially what we do when we present a range of candidates to our clients. We include the hourly cost and hourly cost might be as little as six dollars an hour. If we just take an average of ten dollars an hour if that if it works a 40 hour week which is full time it’s 400 dollars a week, you times 52 weeks divided by twelve there’s your monthly cost and 170 ,1700 per month. That’s just someone at ten dollars and someone at six dollars is 40 percent cheaper significantly cheaper. It just depends on the candidate the candidate’s experience and the candidate’s salary requirements. So we just charge an hourly rate.
Derek: Right. And that is then all encompassed with your software support and obviously your kind of.
Neville: That’s right.
Derek: And the full time employment to the staff. Do you do partial staffing? Do you do hours a week?
Neville: Yeah we do 20 hours a week. The cost is a little bit higher. So we actually have a differential between full time and part time and that cost is around three dollars per hour. The difficulty with part time is that we’ve lost great quality VAs that have got full time work elsewhere. And they always want full time work. So if I can only get part time with you they’ll take it as soon as I get full time they’re gone or what we know they do is they’ll keep this part time job and they’ll go get another full time job as a VA.
Derek: Yeah. That’s what I find commonly there is a lot of moonlighting here in thers which has a bit of a downside. Are there minimum contracts like what’s the general expectation?
Neville: Generally we, look in the first six months there’s a 24 hour notice period. So while we don’t have fixed contracts, a client can start with us and if they’re not happy within two weeks they can say it’s not working. I’ve had a client do that and they said I’ve never gotten someone else that’s better for us but a client can cancel at any time. In the first six months is a 24 hour notice period after the first six months it becomes a two week notice period. So although there are no fixed costs no fixed terms. And what people need to remember is that the investment is not the cost. If you’re spending twelve hundred dollars or a thousand dollars for a VA. That’s not the real cost of the VA. The real cost of the VA. The cost of the VA is the client’s time into invest, to train that VA.
Derek: Yeah. Absolutely, it’s the sum of time.
Neville: That’s right. Because of that no. Well firstly it also takes us two to three weeks just to recruit good quality candidates. So it’s not like I’ve got someone available this afternoon for you. We have to go through a recruitment process to find the right candidates for each role because every role is different. So with that in mind it generally generally a VA doesn’t start in the first month from the time you speak to a client it takes two to three or three to four weeks. Then there’s a lot of time invested in training the VA. Excuse me and so clients might persist a little bit but if it’s not working we say hire slow fire fast. Get someone else in rather than assist with the wrong person.
Derek: Yeah you’ve got to get those wins and you know I think otherwise people can come and become a little bit despondent.
Neville: But on our side. How long do you think it’s going to take you to work out if the person’s right or not. Usually the standard answer is 2 to 3 months, I know it’s two weeks.
Neville: So, and often, often you know it within three days because if you show them how to do something on day one and day two you ask them to do the same thing by day three you don’t even have to ask them and know what they have to do. So it’s actually much quicker than two to three months but for some clients it might be.
Derek: And again I think there’s a lot of factors in there. Depends on how much business experience and employment experience that your client has as well. There’s a whole kind of spectrum of people starting on this outsourcing isn’t it? Fantastic and thank you so much. I mean it just sort of demonstrates your incredible business insight and outsourcing insight and the value of your services as a direct result of all that. How can people get in touch with you Neville if they’re inclined?.
Neville: Look I’m just really happy for people to pick up the phone and call me. I like chatting to people so someone has to give me a call. My number 0402116606, I’m in Melbourne always available for a coffee or a chat. They can always email me, go to my website which is www.virtualstaff365.com.au/. But anyway people want to get hold of me that’s fine. I’ve got a great of you Derek thank you very much.
Derek: Thank you Neville and all of that is in the show notes, we will thank you so much for your time.
Neville: Thank you.
So that was Neville Samuels of VirtualStaff365. I hope you enjoyed that and learnt a lot. He obviously has a lot of business experience in his head there and obviously outsourcing expenses as well. If you want to get in touch with Neville, go to our show notes, that is at outsourceaccelerator.com/122 and of course if you want to ask us anything or get in touch and please just email us at firstname.lastname@example.org. See you ne