Martin Eyking, the founder of a 700+ outsourcing company (New Media Services), is going to take you through a 45-minute training seminar on the best methods to qualify & hire new employees, how to train them to be superstars, and scaling campaigns and operations to the next level.
Speech by Martin Eyking | Founder & CEO, New Media Services
Martin Eyking Speech Transcript
Hi. That was very nice of you, Phil. It sounds more promising and inspiring than the truth is.
I’m supposed to speak about outsourcing. How to train, recruit, and retain outsourcing staff.
Now, this is a bitch of a business.
My father used to tell me, you have one staff member, you have one headache.
You have a thousand staff members, you have a thousand headaches. So what did I do?
I end up with a company with over 1,600 staff in 7 different countries with 1,700 headaches every day. But it is worth it at the end of the day.
What the business really enables you to do is the freedom to think, the freedom to put your legs on your desk and think.
I was talking to a couple of guys yesterday and they said, “Oh, there’s a lot of firework businesses. They’re great for one weekend. We make a lot of money and the next week, it’s like, gee, why did I buy that brand-new car that week? I can’t pay my rent the following week.”
So in outsourcing, it is steady. It’s a steady business. It allows you to create freedom in your mind, create the freedom to be creative to generate the business.
The additional saying of working in the business, against on the business, it’s actually true.
Sometimes, I wake up or I sit on the plane as I regularly do, and what do I actually do?
What Do Business Owners Do
What do I, as an owner of this business, actually do?
I hate to tell you but I don’t do much.
I have a secretary that does this. I have a finance manager that does that. I have an operations manager that does that.
So really, I have created the luxury that I have time to think. And I think this is awfully important, especially for probably a lot of your affiliates and I don’t understand traffic.
Somebody’s been trying to explain to me for the last 10 years till today, I still don’t understand it.
So my apologies. But I believe it’s a very high-paced buy, sell stockbroker, let’s find the next Golden Mile. Let’s find the next G700.
Yeah, how come I haven’t found a G700?
And, I think a lot of that is an issue of lack of time. Time is irreplaceable.
Yet, today is the only day that’s the 15th of June 2017.
Tomorrow, it’s a new day.
So I think what outsourcing allows you to do as I said is, is it allows you time but this is not easy.
Outsourcing, in general, is a headache.
It’s a headache that the people on the other side of the world or even up the road from you. They don’t all have to come from India or the Philippines or Nigeria or Benin or Morocco or wherever they sit.
Outsourcing, in essence, is somebody that works away from you. So, that could be between LA and San Francisco.
The difficulties are still the same.
Is Outsourcing Worth It
No matter where they really sit, nowadays.
Is it worth it? Instead of having your own office? It depends on the task.
You cannot expect any outsource person, no matter how smart they are, to think in the same way as you do. It’s number one. Forget about it.
I’m frustrated, you get sleepless nights.
Why don’t I understand me? How else do I need to communicate it? They’re just not you.
The benefit of having in-house staff is you can sit with them, have a meeting with them and look over their desk to their PC.
What are you doing? Use the mouse to change something. Whatever they do, this is a very easy process.
They deviate a lot of these headaches. So why outsource?
Three Models in Outsourcing
Number 1, that gives you time.
Number 2, for most of you, you probably can afford to do it. To have an office in the first world it’s expensive. It’s difficult to get rid of them if they’re no good.
Yeah, there’s a lot of commitments.
In outsourcing, there’s in essence, 3 models.
One of them is your Odesk type of person, added jobs or now all these websites that provide freelancers.
They’re great, but from my experience, specific tasks only, not long-term.
You have, let’s say, you want to have a website built or you need 50 banners done or whatever, some data entry staff, perfect.
And it doesn’t really matter who you pick on these websites as long as they have reasonable reviews.
You make a deal, you make me 50 banners. This is the design, this is the details, come back to me in a week.
This is very valid. Industry for the project.
Now, if you want somebody long-term to actually work with you, on the goals of your business long-term, then there’s really only 2 models left.
So two and a half, I guess. The first one is you’re gonna find your own full-time staff in whatever country you think has the best skills.
So Eastern Europe has very high IT programming skills. The Far East probably, more data entry type but they all speak English, most of them.
So that’s one opportunity. They work from home.
You manage them on an 8-hour basis, mind your time zones and you give them long-term job descriptions, job tasks.
And the plan is to have them forever and ever.
Create Your Office In One Country
The third one or the two and a half one, let’s say, is create your own office in a certain country. And this is very difficult.
Yeah, again, you have to weigh it up. If I spend 6 hours a day, which I would need to do to set up my office.
Know the local laws, know the legal settings, know the incorporation, the tax liability, the corruption that comes with it in those countries.
Yeah, buying of computers, internet connections, electricity bills, da-da-da-da-da, that is really very long-term.
I know of a lot of people that have tried this and thought that it was easy.
Trust me, it is not easy. It really is not easy. It is almost a full-time job.
So you have to weigh up. Okay, well, I’m busy selling my business or selling traffic behind traffic, doing whatever.
Are You Going To Do It Virtually
This is my core knowledge. This is my core skill. Am I going to stop doing that virtually or put it on a part-time basis, through the iPad at a terminal lounge, quickly, do some Skype Message.
And I’m gonna go for a week to Mumbai or Manila or you know Marrakech in Morocco.
Doesn’t matter where. That’s a decision you have to make. But the problem is, then it’s ongoing. It’s forever and ever.
If you have a physical office there, you have to go every month. Can’t be a remote boss.
Staff wants to know you. They want to get to know you. They need a trust factor. You want to explain exactly what they do.
So, for large companies, this is normally what they do.
But for example, Telstra, if you don’t know Telstra in Australia,, they started with a BPO company for their outsourcing in the Philippines.
And now, they have their own offers. They have their own staff there. Yes, so they tried it first with a company like mine.
And they said, look, we’ve learned the last few years and now we’re setting up our own. But I’m talking about huge corporations.
And the third one is, you use a company like mine. And there’s a million of them.
There are hundreds of them. Some are reliable, some are not reliable, some are expensive some are cheap.
But, what you do get, you get some benefit of management, existing structure, the reliability of service. But of course, it costs more. Somebody has to pay my salary.
So, those are the 3. They have pros and cons on all 3 of those or 2 and a half, 3 and a half.
It’s up to you really, in your own business requirements, what will I allow to do?
So, this is a really, really difficult choice. You have to really think about it, I believe.
For example, you know Accenture. All of you know Accenture right?
Yeah, you know that Accenture has a 160,000 staff in India. They have 50,000 staff in the Philippines.
Accenture. Business, IT consulting company. They’ve obviously, over the years, so it is possible.
And, as a westerner living in London, you use Accenture for your business, you wouldn’t know where the work is done.
It doesn’t really matter. But I’m sure there’s a lot of westerner people living in those countries to support the outsourcing staff.
The Struggle with Culture
In another difficulty that I really struggle with, I guess every day, is the culture.
For us, or at least I was born in Holland, moved around the world for a while, but you have certain standards in life. You have certain expectations. I say yes, we do, yes, etc.
In a lot of the cheaper outsourcing countries, these people worry where their next meal comes from. Literally.
This is a concept until 15 years, maybe 12 years, I had companies in Thailand.
I still cannot comprehend how does that feel not to know where your next meal comes from. It’s scary.
There’s no healthcare in most of these countries.
I used to get every week an email, “Boss my grandma just got cancer, can I loan $1,000 to pay for the medicine?” Sure.
I had 40 staff, 50 staff. I feel bad, $1,000 I can just afford. Okay, fine.
Then next week, somebody else came. “Boss my father just had a car accident, we can’t afford the hospital bill.”
And at some stage, I’m going, “Guys what’s going on here? Like I’m not the bank, I’m not your government, I’m just an employer.”
A Loan Business
And, I started a loan business on the site. You get a loan from me, against an interest rate. And you pay it off of after your salary deduction.
So when you get through Odesk or even your own office, these are some of the difficulties you have to cope with because it will happen.
And the thing is, I have now, as I said you have been at it for 10-12 years, I have staff that has been with me from day one.
And they earn a lot of money like really a lot of money.
Yet we go skiing in Korea, February. I took all my execs skiing for a week. The snow, you know, one of them can’t afford the bus fare to the airport.
Jesus, what the hell? You’re earning all this money.
What happens is, that they become the bank of the family.
So, they pay for the cousin’s education and grandma’s hospital bills and whatever else they do.
Personally, they don’t end up with money.
Make Your Staff Feel Secured
This is such an eye-opener. And, this is so difficult to manage, this permanent lack of money, this permanent lack of security.
I want my staff to feel secure. I want them to feel good about themselves. I want to be happy to come to work.
So what do I do? How else?
I thought I should establish a pension fund. At least, let’s say, they get a salary increase of 5% at the end of the year. 2.5% I’ll put in your saving account.
I don’t let you touch it and 2.5% I’ll give you in your salary. So at least you can buy another coffee or something or whatever you have to do.
I thought of that.
Then, they say, “Oh boss, can I loan against a pension fund because I need to pay for the graduation of my brother’s daughter.”
When you start outsourcing, very much into the third world, you have to consider these aspects of it because they will come.
Do you have to think beforehand how will I deal with it? I guarantee, 100%, it will start.
That’s one cultural issue, which I’ve been very fortunate. I was raised in a normal family in Holland and I always knew where my food came from.
Sure, I might not have always got Nikes but I always had shoes and had a bed. That’s one part.
Communication is Difficult
The other part is communication. Communication is difficult.
First of all, you’re the big white guy or girl. You’re the boss.
You go into the store, they open the door for you. You come to the office, they’ll pull out a chair.
They make you feel like God. Really, they make you feel like, my shit does not smell. Excuse the French.
And it is so easy to fall in that trap, to feel just because the colour of my skin, I am better.
And I see them. I see guys walking around Manila and Bangkok and all that. King d**ks, they are.
They just think you don’t live like this in Berlin or London or wherever you come from.
What the heck? So they are pre-conditioned to think that we are better. Why? I don’t know.
That’s a different topic for another day.
So this is really difficult. How do you break a barrier that you’re not God? This is a humbling experience.
What I do, still till today, I go around my staff’s desks, I pick up the coffee cups.
I pick up their bowl of noodles and wash them. Just to try and show nothing wrong with my hands. I do the laundry at home. I got 3 kids. What’s wrong?
This is really difficult guys.
Breaking The Cultural Barrier
When you start, to break that barrier is almost impossible. I’ve been fortunate enough in my life that I’ve never had a boss.
I’ve always worked for myself since I was that high. So I have no experience, even in the first world, to deal with a boss.
I don’t know how it feels as an employee. Are the people in the first world also scared of their boss?
I was speaking to some of my clients here, in Germany and who are the bosses, “Oh my god, the attitude I’m getting from the staff and they’re talking back.”
Okay, well maybe it’s not as extreme. The employee-boss relationship here in the first world as it’s compared to the second or third world.
So this is an issue. This is something you need to consider and no matter what you do.
I invite them to my house. My beautiful wife and kids come often to the office. We have a barbecue at home.
We try to be as normal as possible. Nevertheless, there is always that cultural barrier, which I find terrible.
This is another one you have to consider.
How do I treat them? How do I manage them to ensure they actually deliver value?
The easiest thing is to have 1,500 monkeys. Yes?
You do A every day at 9 o’clock, at 9:15 you do B, you do C, you do D, easy.
Find those everywhere down to a dozen and very cheap. But isn’t it how you can run a business.
You need people to think, you need people to make a decision. You need people to, well I have a 24/7 business. I’m in 7 countries, time zones. I’m on a plane. When I’m not playing golf, I’m on a plane.
I’m not always there to check what has to be decided.
So how do you empower these people? How do you make sure, try to tell them, “It’s okay do it, make the call good or bad. Make the call.”
I have never fired anybody because they made a mistake. Because I know I make mistakes. I think we all do.
Too Scared To Make A Mistake
They are too scared to make a mistake, they will not lie but they will not be honest. There’s a big difference apparently, I learned over the years.
You know “Boss I didn’t lie,” Well shit, you didn’t tell me the truth either. What’s the difference?
They have this canning ability to somehow, and this is a problem. You cannot grow a business like this.
You kind of have to rely on these people. So, that’s another issue you have to consider.
How do you deal with their communication, their lack of openness, sorry not openness, it’s probably not the right thing. Their lack of confidence, probably is the term, to talk back to you.
I always tell them, “Tell me I’m effing wrong.”
What, just because I own the joint, it makes me God? Makes me the only one with the good ideas?
What the heck? It’s just a Joe Blow, I’m a high school dropout. What the hell do I know?
This is another difficult aspect.
Okay if you outsource from LA to San Francisco, you probably have less of these issues. You normally don’t outsource, you probably have a worker from home if you do an LA, San Francisco or London, Germany type model.
You’re at the same level, you’re at this same cultural level. You have the same understanding of what life is about and what work ethics are about.
So that’s what another one that’s difficult or you have to consider when you do it.
General Lack of Confidence
The other one is general lack of confidence in everything they do.
And I don’t know if we have to blame the church for this or we have to blame America for occupying the Philippines, or the English for India. General lack of confidence is an issue.
And this flows through to everything that they do for you.
“Shall I do this? Shall I do that? How do I ask for a pay raise? How do I?”
It’s almost like you’re becoming their mother and father and brother or sister at the same time. You have to think. They will never ask. They will never confront you, ever or very rarely.
I have staff that has been with me for 10 years. And, only now, sometimes, they call me Martin.
It all started with “sir, yes sir, no sir”
You know, I’m a Dutch guy. I’m like really sir. What the heck? I said, “I’m gonna take one peso out of your salary every time you call me sir.”
Meet Them Halfway
Well after one day, they had no monthly salary left. So I thought shit that’s not gonna work. So, we settled on “boss”. Halfway.
They, still, 10 years, they’re my personal friends. They know my wife, they know my kids, we do the holidays together. Still, they’re unable to call me Martin.
Is that a confidence issue? Is that the culture issue? So, there are compromises you have to make.
And not just say, “Look, here in America or here in Spain or this is how we do things. And this is how I want you to do it”.
You’re barking up the wrong tree, you’re wasting your time. And, you’re asking a monkey to swim.
I don’t know. Can monkeys swim? I don’t even know. You get the point.
So, this is another difficulty.
I have now recently, about 6 months ago, a year ago, I have an office in Nicaragua.
Jesus. Another culture altogether.
And they stuff it up, “Oh yeah, sorry boss I know I stuffed it up but it will never happen again.”
Okay, sure. Next week, stuffed it up again. “I thought you got rid of that staff member?”
“Oh yes boss I haven’t yet but I’m getting to it”
“Look the client is complaining, what the heck are you doing?”
Again I have to now learn about their culture. How to deal with them, how to ensure that they do the job I want them to do or our clients want them to do.
24/7. I don’t work 24/7, none of us do. So, if you have staff that works in different time zones, while you’re asleep, they’re doing your tasks.
They’re only as good as how much you train them, how much information do you give to enable them to do their job.
In IT, it is very difficult. Do you trust somebody to give them access to your code?
What happens if they take your code and go home?
Then okay, well how much IT outsourcing can you actually do compared to keeping it in-house.
There are outsourcing companies that are very high-level and do the very high-level type of work.
But these are the companies that are in option 3. They’re company-owned, they have their own officers. They have their own home office staff living in that country and that office to control what goes on.
And, I believe that is the only way to successfully do the high-level type of jobs.
But if it’s just data entry, banner designs, landing page designs, maybe some analytical data.
Some comparison in Excel spreadsheets or doing some research and give you a report back, those tasks are pretty easy. And you probably can get reasonably good quality staff to do those sort of tasks.
Even if you go through an Odesk or you have one dedicated staff member who works you directly. So that’s on that one.
And what else you guys want to know? I’m trying to think what else would be beneficial.
Invest Your Time
If you go for option 2, you need to go. You need to go there. Invest the time and the airplane ticket, you need to go meet them face-to-face.
We all have FaceTime and Skype and all that. And, I might be an old guy compared to you. But Jesus Christ, face-to-face time still takes over any other form of communication.
If you decide option 2, go. Invite them to you but then you’ll find out. “Okay, I invite you to the office, you can meet the other guys and it’s great.”
“Sorry sir, I don’t have a passport.”
Okay, shit no passport. “Okay, go ahead apply for a passport.”
“Sorry boss I don’t have money to apply for a passport.”
“Okay, I’ll send you some money for a passport.” Three months later.
“Come to Holland, come to Australia.”
“Boss I need a visa.”
“What the hell, you need your Visa.”
“Oh shit, how do we get a Visa.”
“Oh I need letters of introduction. I need money in my account. Money in my bank account to show to your Australian government or the American government.”
So, “Sorry boss I only have 1,000 pesos in the account.”
“Okay, I’ll wire some seed money,” they call it. It’s called Visa money or show money. That’s it. That’s the term. Show money.
So, I go and transfer 1,000 bucks or 2,000 bucks. And then, in the hope that they’ll send it back one day after they’ve printed out the bank statement that they need to submit to visa.
Nothing is Easy
So, nothing is easy. It is draining. So, before you even think of outsourcing, you need to consider all the pros and cons.
Is this really for me? Is this really what the businesses is? Long-term, will the business benefit from it?
Will I as the owner be able to sleep? Will I have the trust in these staff? Will I look after them? Will they look after me?
These are all types of questions that you need to consider before you even think about it.
As I said the easiest option and it’s not my business, I have enough customers, it’s not about that, is the third option.
Normally, these companies have a representation or something in your local city.
You can meet with them. You’re in the same culture. And then, they will provide you with a more cost-effective solution that you can get locally yourself by hiring staff in your office in London, Berlin, Paris, wherever it is.
So, this might be a way to start the concept of outsourcing and test it. Relatively easy.
Let’s test just 1 month. Design me 100 banners or do me some customer support or do my Facebook Likes or do my Snapchat chats or run my Twitter account or whatever you guys need.
Learn From Your Mistakes
Start that way. Sure, it’s a little bit more expensive, it’s still cheaper than having your own staff. And then learn.
Learn from your mistakes. That’s what I do every day.
I’m not, by any stretch of the imagination, an expert in this. I just have experience. 10 years of experience.
I could stay there all day long, I’ll tell you all the stories that I’ve had, good and bad.
So, I guess this is at the end of the day, your call. But my suggestion would be, start with option 3.
Slowly test it, see if it works. And then maybe, if it is serious and your business needs, probably anywhere more than 6 resources, I would go for option 2.
If you need just 1 or 2, I’d probably look for, 2 and a half, sorry, I would look at the dedicated staff. Yeah, if it’s up to 6 staff.
Having A Local Office
The issue with having a local office there, a lot of these countries support the employees. And the employers are the nasty capitalists.
We’re here to ruin their countries. We’re here to screw their staff. We are here to underpay them.
Just this morning, I got a labour case from a staff member that I terminated last month, official letter. Not suing me but, illegal dismissal.
What the hell?
Of course, there’s a process we follow, by law, there’s an NTE, there’s a warning, there’s a discussion, for a 6-month period.
Nevertheless, it’s free for him to go to the labour office and say, “This schmuck, rich, white guy has terminated me. My kids can’t go to school now. I have no job left.”
And I don’t know, let’s see. On the 27th of June, yet again, I’m going to the labour office.
Pitfalls On Having A Local Office
These things you have to consider. That if you have your own office, it will happen.
I know of a company, they set up their own office. “Great, good for you. Wonderful, in Manila.”
They appointed a local manager. Great, nice guy, switched on, young, late 20’s or something digital age boy.
I’ll find the local staff, have the computers and all that sort of stuff.
After 6 months, they realised that any new staff member he hired, he had to deal with them that he was collecting 10% of their salaries.
So, while they’re in Paris or wherever they were, this local manager in Manila was hiring staff, about 20 of them to do ad compliance or other stuff and whatever else.
And he says “Huh, you want to work for me? I need 10% of your salary every month otherwise, you I won’t give you the job.”
So, these are some of the pitfalls when you go for your own office.
Legal issues, ownership issues, labour issues, Social Security payments and such.
You really need a long term commitment if you want to set up your own office.
And that’s it, I guess.