What is Offshore Software Development and Why it is Important for You?

Are you a startup with limited resources and want to create reliable solutions by saving costs?

Are you an enterprise-level company that wants to outsource software development companies to meet deadlines?

Offshore software development services help you scale your business without much hassle. In fact, the global IT outsourcing market is projected to reach $425.19 billion by 2026, according to GlobeNewswire.

No doubt, outsourcing is a popular option for developing a web app, mobile app, or enterprise-level solution. With research, we have written this guide that helps you to know whether hiring offshore software developers is a suitable option for your business or not.

This blog post will take an in-depth understanding of what offshoring is, the business model’s benefits, how to hire offshore software developers for your project, and where to look for offshore software developers.

Let’s dive in.

What is Offshore Software Development?

Offshore software development refers to hiring a software development team from another country to create your desired software.

Generally, the outsourcing of project development is done for three core reasons.

• Reduces the development costs
• Saves time for core business goals
• Scale the business rapidly

Businesses also find it beneficial to opt for offshore software developers to cater to the high technical demand generated without additional costs and hassles. There are three types of outsourcing.

3 Types of Software Development Outsourcing

Before we get into the details of offshore development software services, let’s better understand the various types of outsourcing and get a basic overview. Below, you will learn about nearshore, onshore, and offshore software development.

1. Offshore Software Development

   Offshore software development means outsourcing projects to countries that are far from your location and have different time zones. The main reason for offshore software development outsourcing is the affordable cost.

   For example, you are in the USA country, and you hire developers from Ukraine.

   As the hourly rate of developers is cheaper in many countries, the overall cost of project development becomes less. The most popular destinations for offshore software development are India, Ukraine, and China.

   But essentially, it totally depends on your business requirements and the complexity of your project.

   Although, the successful collaboration of North American businesses with Western European software vendors proves otherwise.

2. Onshore Software Development

   As the name suggests, when a business recruits a software development team within its geographic location, it is referred to as an onshore software development process.

   For example, you are in Canada, and you hire developers locally in Canada.

   This is an option taken by many IT companies as software engineers are more approachable in their own country. However, setting up offices for the development team incurs additional production costs, which may add extra costs to the budget of companies.

3. Nearshore Software Development

   Nearshore outsourcing refers to hiring talents from nearby countries to get your work done. Nearshore outsourcing offers services similar to other types of outsourcing; it’s just that you hire talent from the nearby country location.

   For example, you are in the USA, and you hire software developers from Canada or Argentina or Mexico.

   Western European countries, for example, have the nearshore option among Eastern European countries, such as Poland and Ukraine. Likewise, USA-based IT companies can opt for software service providers from North America.

Want to know the detailed comparison of nearshore vs offshore outsourcing?

Download the Complete Comparison Between Nearshore vs Offshore

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Let’s now look at the advantages of offshore software development model and why switching to this service may be critical for your business’s profitability.

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5 Benefits of Offshore Software Development

1. Access to Global Talent of Developers

   One of the essential benefits of hiring an offshore software development team is you get accessibility to vast talented developers and engineers. Here you are not restricted to hiring a limited number of talented software programmers for your project development.

   In addition, you have the option to hire a highly-skilled professional who has expertise in various domains. Also, these technical software professionals possess a specific skill area, which makes them highly talented professionals. They follow the latest software development methodologies to create scalable applications.

   According to a HackerRank report, China, Poland, Russia, Switzerland, and Hungary are top-fives countries where the best developers are available to hire. So, if you opt for offshore outsourcing, then you get to hire top talents from these countries.

2. Reduce the Development Costs of Your Operations

   Outsourcing from top-rated offshore software development companies reduces your cost without compromising the quality of your work.

   Check this report.

   According to the Deloitte survey 2021, cost reduction and process efficiency are two benefits achieved while opting for outsourcing services. The key benefits achieved by the businesses for opting for outsourcing services are as follows.

   • 88% cost reduction
   • 78% standardization and process efficiency
   • 63% business value

   Also, outsourcing the IT services helps to reduce the time and reflects in the cost reductions. Because your organization doesn’t need to invest time and money in the premises, administrative staff, legal work, payroll, developer salaries, and other operational costs. As a result, choosing offshore custom software development services is typically lower than working in-house.

3. The Opportunity to Scale Quickly

   You have the option to scale up or scale down your resources as per your requirements. Outsourcing your project development brings another advantage to hiring developers when the requirements of the project get increase.

   It helps you to decide when to increase developers to scale up your business. And sometimes, scaling your web or mobile application immediately is challenging. That’s why choosing offshore software development processes is effective. When you want to speed up your project development, you get the option to hire more offshore software developers around the world. Also, it is a reliable solution when you want a team for a limited period.

   However, hiring talented offshore software developers is not effortless. The reason is you need to know the skills of offshore software before hiring them and ensure they possess knowledge and skills that help you achieve your goals.

   Although, you need to know the full-proof process of hiring offshore software developers that help you fast scale your application. So, expanding your offshore software development and scaling your business rapidly with digitalization, allows you to meet growing demands and, thereby, increase profitability.

4. Focus on Your Priority Tasks

   If you are dealing with multiple variables of your business, then it might be difficult to manage several things at a time. Multitasking leads to decreased efficiency as your attention is diverted amongst many verticals.

   Bringing on an offshore project development team helps you to focus your attention and resources on expanding your business and working on the profitability metric. This also gives you ample time to market your core business values while the offshore software development team can handle your business’s software-related aspects.

5. Opportunities for New Projects

   As said, outsourcing from offshore software development companies helps you reduce costs. You get an opportunity to invest that cost into the research and development of your business. Streamline your funds into projects and ventures that were a part of your business roadmap but could not be implemented due to financial constraints.

   Additionally, the time and resources that are saved by hiring an offshore software development team can be used elsewhere, including ideas for new ventures. It is thus a win-win situation for your business.

   However, if you still want to learn in detail about the benefits of offshore software development, read our in-depth article on the 8 advantages of offshore software development. Get detailed insights on how offshore software development brings benefits to your business and why you should prefer offshore software development services.

How to Manage Offshore Software Development Team in 5 Steps

Here are a few tips to help you effectively manage your newly recruited offshore software development team.

1. Share the Vision and Goals of Your Business

   One of the most critical steps that are often overlooked by businesses. In the initial stage of business, it is essential to introduce your business formally. Things like the principles on which your business is built and your business’s goals and projects you want to work on in the future.

   This helps the offshore developers fully understand your business and its role. It also helps them to write a software requirement specification document. So, the better understanding developed by the offshore development team, the more effective solutions are prepared.

   Sharing your vision and goals with an offshore software development company helps to build the solutions as per your requirements. This reduces the changes in the development process of your project idea.

2. Bridge the Culture Gap

   It is natural for you to encounter some cultural differences with your offshore software development team. However, instead of letting that get in your way, you should use it as an opportunity to learn more about contemporary culture.

   Be open to getting to know the offshore developers’ cultural practices and also introduce your cultural practices to them.

   It is essential to establish this unification of cultures with no hindrances while collaborating on a joint project.

   Thus, it is your responsibility to ensure that the offshore team has ease while interacting with other employees. Visiting your offshore team once in a while will help in the cultural exchange.

3. Collaborate and Communicate

   When working with an offshore team, communication is the effective part of obtaining effective results. It allows you to get the tasks accomplished within the deadlines and requirements.

   But how do you manage the communication process effectively?

   Check the following tools that help you to manage your communication effectively with your offshore software development team as well as in-house developers.

   • Email and Calendar: Official communication, schedules, and setting up project-related meetings can be done via online calendars accessible to everyone.
   • Messaging: Tools like Slack and Skype are efficient in forwarding information regularly.
   • Project Management Tools: Monitoring the progress of your project is critical when working with a technology partner. Because, without it, you wouldn’t know the particulars of project development on which your developers are working. Tools like JIRA, Asana, Slack, and Basecamp help the project managers to keep track of everything that is working in a project.

4. Consider the Time Difference

   Differences in time zones are bound to come up when working with offshore development teams. Instead of letting this be an obstacle, you can overcome it by working in alternation and overlapping the work hours.

   For example, If you hire an app developer from Australia and you reside in the UK, then it creates time differences to work together. That’s why you should establish proper coordination between your in-house and remote development team to avoid communication issues.

   Overlapping the working hours will help you build a more efficient schedule for your business. Overlap meetings and weekly progress call to ensure that communication between your teams is not affected due to time difference.

5. Avoid Micromanaging

   Are you trying to manage every little detail on a project? Do not try to micromanage.
   It hinders work and overall performance.

   Because the hired offshore firm is a thousand miles away from you, it is best not to interfere with every tiny detail of the project. The offshore team will feel constrained; this lack of freedom will affect performances.

   Therefore, communicate with your offshore team at the start of any project and only ask for an update on important information.

Still, have some queries or questions related to the offshore software development or offshore team?

Check the following frequently asked questions section on offshore software outsourcing.

Looking for Offshore Development Services?

You have learned about offshore development services. In short, in the following conditions, you should choose offshore development services.

• If you want to develop high-quality software within a limited budget.
• It is preferable to choose offshore outsourcing when you immediately need to scale your project, so you do on-demand hiring.
• When you want to hire niche-based technical experts, then opting for offshore gives you the opportunity to choose the best.
• You get an option to choose from a large pool of talent that helps you cover your demands and build the best products with creative insight.
• You don’t want to take frequent onsite visits, and managing the team digitally is a suitable option.

Want to hire an offshore development firm? Connect with us to develop software solutions. We are one of the leading offshore development companies in Canada. With years of experience, we have created 300+ custom mobile and web solutions.