What is offshore development?
Offshore development is simply synonymous with outsourcing. This means that you send your software development remotely by people in different geographies. While ‘offshoring’ is seen as risky in terms of ROI, many software companies are considering outsourcing software development as it can actually help a lot. Often the main reason for outsourcing is the lack of human resources required for software development or the lack of required skill level.
From simple coding to custom development, mobile app development, software support and maintenance, website design and development, you can outsource tasks to a third-party offshore software development company. .
The development of offshoring will save you the challenge of hiring and training new staff and at the same time ensure that you are getting the best quality software delivered to you in no time. Offshore application development is used by many of the world’s largest and most famous companies, so there is no doubt about its effectiveness.
In 2019, the global IT outsourcing market was valued at USD 333.7 billion, which is only expected to continue to grow in the years to come. The inevitability of digital transformation is prompting organizations around the world to outsource their software development needs. Offshore development companies are thus becoming an extremely important part of the global economy.
What is the difference between onshore, nearshore and offshore?
Onshore: Onshore outsourcing is when you decide to hire software developers in your country. Most businesses find this option convenient and accessible.
Nearshore: Nearshore outsourcing is when you decide to outsource to developers from countries with a similar time zone. Typically, customers rely on geographic proximity and cultural similarities.
Offshore: Here the service provider’s company is located in a country different from yours. It could even be a different continent with a noticeable time zone difference.
What Makes Offshoring Software Development So Popular?
The main reason for its popularity is financial profitability. With offshoring, it is possible to minimize personnel expenses within the client’s organization as well as reduce expenses such as rental of premises, equipment, social security and deployment of development. In many developed countries, hiring and paying qualified in-house developers has a significant impact on the budget.
Some of the most popular offshore countries in the world include India, China, Russia, Ukraine, Poland, Taiwan, Vietnam, South Korea, etc.
On average, you can expect your offshore software development vendor to charge approximately the following rates per person per labor hour;
Asia and Africa: $ 18 – $ 40
Eastern Europe: $ 25 – $ 50
Central America and South America: $ 30 – $ 50
North America: $ 95 – $ 170
Depending on requirements, commitments and pricing models, the above fees may vary. To know the actual outsourcing rates, you should contact the vendor directly.
How does offshore development work?
When you plan to team up with a software development company located in another country, you can:
Delegate the project to an individual developer or to a offshore development
Delegate only parts of the software or the entire project to the remote team
Hire a dedicated offshore development team
whether you hire a dedicated team or an individual, you will have complete control and ownership over development progress, ensuring employees are in contact with each other. This might not be a good idea unless you are passionate about management and keep monitoring remote employees.
If you turn to the services of a development agency, you won’t have to worry about finding the right resource to manage work processes. Most issues such as if a team member falls ill or quits will be taken care of by the company instead.
What Are the Benefits of Software Development Offshoring?
1. Shared responsibilities and competent competences
Offshore development companies are more likely to share and manage risk during projects, as they are also dependent on the end result. Plus, deadlines facilitate a faster process.
2. No training or administration required
Outsourcing companies must remain competitive, so they will have the required expertise. So, you don’t have to worry about resource training. In addition, the operating and administration costs will be negligible as you won’t have to deal with office space, equipment, recruiting, etc. All of these will be taken care of by the offshore software development company.
3. Faster time to market
The development of offshoring ensures that your product reaches the market faster and on time. When skilled people are working around the clock to develop your product, you can rest assured that you will get quality software in the end. Additionally, an external person or team can help you improve your business processes and enable you to leverage creativity and innovation at every stage of the software cycle.
4. Lower cost
It is undeniable that maintaining an in-house IT team with expertise in the latest technologies is both difficult and expensive. By outsourcing your software development, you don’t have to invest in IT infrastructure or worry about recruiting and training employees.
What are the disadvantages of offshoring software development?
1. Differences in language and culture
Differences in language and work ethic, cultural issues, what is offensive and what is not, etc., can lead to unpleasant situations if not known in advance. For example, working hard might mean something different in Spain and the UK. So, you will need to be thorough about the culture of that particular country before relocating.
2. Main communication problems
Different time zones, working hours, bandwidth, etc. can slow down communication. It might even hamper the monitoring and resolution of everything in a timely manner. A clear interpretation of roles and mechanisms, strong leadership and active management of culture by adapting to the corporate culture of the client or supplier is an effective way to manage cultural differences.
Data security is one of the biggest challenges businesses face today. When relocating your data, it is important to validate the reliability and respectability of the provider to ensure data security. As a best practice, it is recommended to sign a non-disclosure agreement (NDA) or confidentiality agreement between the two parties (client and offshore partner) which strengthens data confidentiality and relationship terms.
4. Quality of work
While offshoring can be cheaper, it doesn’t guarantee the precise skills or commitment needed to get the job done. There is always a chance to hire a team without the right skills. It is important to check the background of the supplier before outsourcing your needs.
What are the latest trends in offshore software development?
Software development involves complex processes and is never an easy task. Developers and agencies must embrace new technologies and trends to stay relevant and competitive.
Here are some of the latest trends in offshore software development:
Automation plays an important role in reducing human dependency, risks associated with manual labor and costs. Besides the innovat ion and faster responses to changing business environments, technologies such as RPA play a significant role in reducing administrative costs.
2. Cloud computing
Cloud computing offers scalability and flexibility and plays a vital role in offshore software development. More and more companies are realizing and leveraging the benefits and possibilities of cloud computing. Soon, cloud-based applications and cloud infrastructure will be the way of life in offshore software development, enabling businesses to meet the growing needs of businesses around the world.
3. Artificial intelligence (AI)
AI is taking the world by storm and software development is no exception. AI is also used specifically to improve the quality of code and tests. Developers can combine AI technologies like natural language processing, machine learning, and business rules to create better software in a short time.
How to choose the right offshore software company?
There are many offshore software companies around the world and finding the right one can be a daunting task. While word of mouth remains one of the best ways to ask for a referral, talk about the offshore team, and ask important questions, there is still a lot more to consider.
First, the preparatory work is important. Finding the right offshore development company takes evaluation and time. An important tip is to contact several agencies and compare what they have to offer.
In addition to checking the portfolios of software outsourcing companies, take the time to browse their social media IDs, blogs, resources, approvals, and codes, if possible. You may even consider testing a potential partner company based on technical requirements, as this will help you make an informed decision.
Here are some tips for choosing the ideal offshore custom software development company:
Visit the websites of several offshore development companies
Consult their portfolio and analyze their past and current projects
Understand the company’s experience in the sector that interests you
Learn the company’s rating on websites like Goodfirms or Clutch
Read customer reviews and testimonials
Discover the professionalism of programmers
Find out how the company can support applications if you are having issues with development
Find out if the development of the project is iterative / agile (i.e. doing the work in parallel with continuous analysis of results and adjustments in previous stages of the work) or not
Best practices to follow when relocating software development
Meet all the developers who are supposed to work on your project
Make sure you have a full time team onshore and an offshore team as they can set the necessary coding standards, help with technical issues and mentor the offshore team.
Use video conferencing to hold regular meetings to manage issues and resolve them quickly and efficiently
Use appropriate monitoring tools (project management tools) to effectively plan tasks and prioritize work accordingly
The demand for offshoring software development continues to grow as organizations seek to optimize their business processes and align their strategic planning with their operational strategies. Outsourcing your IT needs can be a boon in times of financial and natural hardship, as offshore development companies like Napollo implement business continuity and disaster recovery plans to meet their obligations and deliver seamless services. interruption.