What are the Benefits of Offshore Software Development?

A Quick Overview

Even after the COVID-19 massive hit, have you wondered why the IT industry was still profit-spinning when all the others were facing downfall? All because of the sudden rise in the concept of offshoring and outsourcing. Offshore development services and offshore development service providers seem to have been pretty much in vogue, and why not? Since it offers a plethora of benefits and advantages ranging from cost-effectiveness to hiring from a diverse pool of talent and so more.

We are living in 2024, and it seems that global economic uncertainty can hit us hard at any time. This is why businesses, irrespective of size and different industry verticals, are gearing up for offshore software development projects. As the name implies, offshore software development hires tech-based services beyond borders. Let’s get the basics clear, the following post focuses on what is offshore software development and how is offshore software development beneficial in the long run.

What is Offshoring?

Well, it is a major practice of relocating certain business procedures or tasks to another region or country. Now offshoring mainly comprises two distinctive models.

First — Offshore insourcing

As the name implies, offshore insourcing is when businesses tend to build their in-house team in another country specially to receive assistance for their tech projects. Let’s say you have a company based in Singapore and decide to hire a team of developers or a dedicated tech team in one of the most popular offshore destinations such as Vietnam for handling all kinds of IT projects then it is called offshore insourcing.

Second — Offshore Outsourcing

This concept is said when businesses tend to outsource their projects to a third party an external company or an individual overseas. The same Singapore-based company hires third-party service providers who are located in Vietnam for their tech-based requirements.

Offshore software development has become quite popular these days and the worldwide IT outsourcing market is expected to obtain $425.19 billion in terms of revenue from 2021 to 2026. So the popularity of offshore software development services has seemed to gain momentum quite lately and if you wish to gain an edge above your competitors then this is the best bet to think upon.

So the process of transferring software development projects, be it fully or partially to a third-party development services vendor who is located in a faraway country featuring low-labor costs. By doing so, businesses can successfully leverage a wider talent pool and have insane and instant access to all the cutting-edge technologies and reduced development costs.

Let’s say your company is located in the US, so you can look around for skilled and cost-effective IT vendors from Central and Eastern Europe, such as Estonia, Poland, and Ukraine. When you opt for offshore development service providers, you no longer have to bear the headache of developing software and managing development teams.

So Now What kind of Services Can Be Successfully Outsourced?

• Mobile App Development Services
• Web Development Services
• UI/UX Design
• QA services
• Cloud Infrastructure Management

Popular IT Models — Onshore/Nearshore/Offshore

#1 Onshore

The first and foremost model is onshore. As the name implies, the cooperation model mainly refers to a situation where both companies are located in the same country.

So it is safe to say that onshore development is the closest project being conducted near home. After all, you are working with a company in your home country. Now proximity is the best benefit here and a hefty price can be quite a disadvantage. Also, here there are chances that you might not end up choosing the right talent since the pool is quite shallow. Some core benefits of onshore development include:

• No concerns regarding language barriers or cultural differences
• No time zone differences to be faced
• Easy to communicate and collaborate
• Development teams are potentially accessible

So think very hard before considering onshore development.

#2 Nearshore

The next option is nearshore and as the title implies, Nearshore is said when your outsourcing partner is located in the neighboring country somewhat a short distance away. This one is a mid-way solution, it successfully bridges the gap between onshore as well as offshore.

Nearshore is said when the team is located near your country, perhaps the border of your country. So yes nearshore acts as a perfect balance between onshore and offshore. Now let us see what are the benefits this development model has to offer.

• Reduced time zone differences
• Reduced price in comparison to onshore
• Same culture so no such language barrier or differences are found
• Being able to visit your tech partner’s space every once in a while
• Increased talent pool especially in comparison to onshore.

So yes if you don’t want to pursue offshore development then Nearshore can be your best bet.

#3 Offshore

Last but certainly not the least is offshore. Now this one as the name suggests is said when the software development company or the team is entirely located in another country, maybe the other side of the globe. A successful offshore company said when it incorporates advanced technological services are available at quite a low cost. Now offshoring can be way more beneficial than onshore and nearshore let me show you how.

• Easy access to a global talent pool
• Hiring well-experienced experts at a lower price
• Dedicated IT teams can work on a plethora of services
• Deliver strict deadlines
• Saves ample time and money

Still not convinced. Let me elaborate on it for you! Further below I would like to mention some of the most crucial benefits of considering offshore software development.

Potential Benefits of Considering Offshore Software Development

#1 Global Talent Pool

The first and foremost advantage of offshore software development is you can easily tap into a global talent pool. When you outsource your software development needs. Here it is possible to gain access to skilled and experienced professionals from different parts of the world. So here a unique blend of expertise is roped in where you will find a wide range of creative minds, aggressive brainstorming, fostering innovation, and solving problems, and in the end, you are guaranteed the best possible results.

#2 Cost Efficiency

Another major advantage to take into account is cost efficiency. Yes, offshore software development is the prime choice if cost efficiency is the major concern. Outsourcing is said when the development costs overall get reduced without even compromising on the quality. So here you are bound to receive lower labor costs with skilled professionals which means there is a wide possibility of developing high-quality software.

#3 Flexibility and Agility

The very next benefit of choosing offshore software development is great flexibility and agility. Now can you tell me exactly how much time it takes to hire an in-house development team? Almost 38 days or way more now when you stretch the timeline due to a shortage of talent or severe competition, you might end up losing the battle already.

On the contrary, opting for offshore development service providers or a company means you can gain an instant advantage without even stretching the timeline. Sometimes offshore development services can ensure quicker time to market. Businesses can seamlessly scale up their tech capabilities since they have a specialized development team tailored according to different product requirements. And if you somehow happen to choose a reputable or reliable software development company overseas then no matter of geographical boundaries or local talent storage, you are bound to receive nothing but the best for your business.

#4 Extended Operation Time

Another crucial benefit for considering an offshore software development company is that you are capable enough to pull off 24/7 operation or should I say working hours and all thanks to totally different time zones. Here the key is to strategically deploy teams as well as tasks ensuring a seamless transition between onshore as well as offshore. This also means your development project is progressing even while you are asleep.

Over the past few years, it’s been observed that this approach doesn’t boost operational efficiency but also enables seamless provision for support and round-the-clock services which are pretty important for different sectors and industry verticals.

#5 Focus on Core Competencies

Lastly, offshore software development services enable businesses to concentrate pretty well on core competencies. This means, you no longer need to force your valued employees to bog down with intricate, stiff, tedious coding stuff and programming tasks. On the contrary, you have experts for that instead you can focus on your strategic planning, how to enhance customer relations, and develop business seamlessly.

Disadvantages of Offshore Development to Consider

Of course, there is a fair share of controversies when it comes to offshore development services such as:

• Quite long-distance
• Cultural differences
• Language barriers resulting in miscommunication
• Security or trust issues
• Less control
• Intellectual Property Protection
• Time-zone differences

Conclusion

Opting for an offshore software development company is a must-do thing especially if you want to gain an upper hand over your competitors in no time. And of course, these services do offer a wide set of advantages. Now the only issue is when you choose to hire an offshore software development company you need to look out for numerous peculiarities such as the geographical distance can be a major concern since it can lead to a significant time zone difference which can affect or even interrupt the workflow.

Apart from time zone differences, certain language and cultural differences can be a barrier here. And above all, you need to be extremely careful with the choice of your tech partner. One wrong choice and everything can be doomed. Try looking around for a reputable and reliable offshore development company that has a proven track record of never disappointing their valued clients.

Well, the benefits of hiring offshore development services are plenty but the question is are you ready for it? I hope the following post was insightful and worth the read. If yes, feel free to share and help us in reaching out to more readers. Also, good luck with your offshore development venture.