Salesforce, Workday: Offshoring for Cost Savings and Global Talent Access

In the ever-evolving landscape of technology and business, companies are continually seeking ways to optimize their operations and remain competitive. Two prominent players in the enterprise software market, Salesforce and Workday, have turned to offshoring as a strategic move to save cash and access a larger talent pool. Let's delve into the reasons behind this trend and its potential implications.

Offshoring, the practice of relocating production or services to overseas locations, has become an increasingly popular strategy for many companies. By moving certain operations to lower-cost countries, businesses can reduce expenses and reinvest those savings into other strategic initiatives. This approach has been embraced by both Salesforce and Workday, with each company offshoring specific functions to take advantage of lower labor costs and access a diverse talent pool.

For Salesforce, offshoring has enabled the company to:
1. Access a larger talent pool: By hiring internationally, Salesforce can tap into a global talent pool, gaining access to specialized skills that may not be available in their home country. This infusion of expertise can improve the quality of a company’s products and its innovativeness.
2. Save on labor costs: Many offshore countries have lower costs of living, which means lower salary expectations. For instance, the average salary for a software developer in the USA is around $132,000 per year, while equally skilled remote developers in Eastern Europe can be hired for $25,000-$41,000, resulting in potential savings of 60-75% on labor costs alone.
3. Focus on core business functions: By hiring offshore teams, companies can focus on their core business functions, as they no longer need to invest resources in non-core activities.

For Workday, offshoring has enabled the company to:
1. Reduce costs: By moving certain operations to lower-cost countries, Workday can reduce its overall expenses, allowing it to reinvest those savings into other strategic initiatives.
2. Access a diverse talent pool: Offshoring allows Workday to tap into a global talent pool, gaining access to specialized skills that may not be available in their home country. This can improve the quality of the company’s products and its innovativeness.
3. Alleviate financing constraints: By reducing costs and accessing a larger talent pool, Workday can alleviate financing constraints, allowing it to invest in other strategic initiatives.



While offshoring offers numerous benefits, it also presents potential risks and challenges. Quality control issues, time zone differences, security and intellectual property concerns, cultural differences, language barriers, and dependence on offshore teams are all factors that companies must consider and mitigate. To maintain or improve the quality of their products and services, companies must carefully manage these risks and implement appropriate measures to address them.

In conclusion, Salesforce and Workday have embraced offshoring as a strategic move to save cash and access a larger talent pool. By doing so, these companies can focus on their core competencies, improve product quality, and invest in other strategic initiatives. However, it is crucial for these companies to carefully manage the potential risks and challenges associated with offshoring to ensure the long-term success of their operations.