Learn to Offshore Software Development the Right Way

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Finding a talented, dedicated team of software engineers can be challenging. Local talent can be slim, operational costs are on the rise, and competition is fierce. All these factors and more are encouraging more companies to opt for software offshore outsourcing.

Offshoring has more benefits than many American executives realize. All of these benefits extend to the software development process. However, it’s not entirely risk-free. You need to do your research to maximize value while outsourcing software development offshore.

This article will highlight the risks and benefits of offshore software development services. You’ll also learn what to look for so you can minimize the risks while reaping the benefits of outsourcing services.

What is Offshore Software Outsourcing?

Offshore software outsourcing involves adding overseas workers to your software development projects. You may rely fully on offshore workers or combine onshore and offshore workers in your project. Many executives believe it’s a great way to address the US tech skill shortage.

There are offshore software development companies dedicated to connecting business owners with developers. Alternatively, there are also offshore outsourcing partners that include software development outsourcing.

The top countries for software development offshoring include:

  • The Philippines
  • Vietnam
  • Taiwan
  • India
  • Brazil
  • Argentina
  • Ukraine
  • Poland

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4 Benefits of Offshore Software Outsourcing

1. Expedite Deadlines

With more developers on your side, you can drastically increase your product development speed without compromising quality. Different time zones mean that someone might be working on your product all hours of the day.

All these extra hands can also improve the quality of your product. More eyes on your code lessen the chances of a bug slipping under the radar. The result is fewer project launch delays, faster time-to-market and last-minute bug fixes.

Building an offshore team is also significantly faster than hiring onshore employees. If you need a big team and have tight deadlines, you can streamline the hiring process by going offshore. Lack of qualified labor never has to be the reason for a delay.

2. Reduce Costs

Development costs can add up quickly. If you want to deliver a high-quality product, there are certain areas where you can’t cut corners. Many tools and assets are worth the money.

However, you can dramatically reduce the cost of your project with offshore outsourcing. Software developers from overseas typically don’t require the same pay as ones from the United States. It’s a simple and effective way to reduce costs without compromising quality.

Your company also isn’t responsible for worker benefits with offshore staff. Better yet, many countries offer tax breaks to companies that have offshore operations in their region. You can reduce project costs and potentially receive some financial gain.

What is Offshore Software Outsourcing

3. Corporate Growth

Software offshore outsourcing gives your company the chance to expand to a new country. Hiring local workers creates name recognition as you expand operations. Word of mouth gives you more time to market your business.

These doors can open to unexpected opportunities. Hiring offshore software developers may be your first step toward a whole new audience. You’ll already have a positive reputation in that region for valuing the talent of offshore workers.

4. Scalable Teams

The American workforce is volatile. There’s a high turnover rate for a number of American businesses. If you’re a leader facing this problem, you’re far from alone. Unexpected resignations can also cause unexpected delays and delay your projects.

Additionally, with the shortage of qualified developers, the rate of pay has increased drastically. With businesses feeling such an economic pinch, that’s where offshoring your development work becomes a good idea.

Don’t let a sudden resignation impede your development. Offshore outsourcing software projects allows you to scale your team up and down as needed. If someone onshore leaves the team, you still have a plethora of talented developers who can pick up the slack.

Sometimes, offshore software outsourcing IT tasks come from the same team. You can choose whether to hire separate people for IT support or you can trust your offshore developers to do these tasks as well.

4 Risks of Offshore Outsourcing Software Development and How to Mitigate Them

1. Data Security

Understandably, many business owners are apprehensive about sending internal data overseas. American corporations are globally the number-one target for hackers, which is why you need to make sure that you trust your offshore developers.

Partnering with a trustworthy offshore software outsourcing company is your key to mitigating this risk. Research data protection in your outsourcing destination and set clear standards. Strong cybersecurity measures are always a good idea no matter who’s on your team.

The vast majority of offshore employees are honest people who just want to work. Some companies even hire offshore cybersecurity experts. With the right resources, research, training, and an experienced partner, you will greatly reduce the risk of data breaches.

2. Legal Differences

Not every country will have the same legal standards as the United States. These legal differences may impact your outsourcing destination choice. Luckily, there are offshore outsourcing software development companies that may already have a presence in the U.S. and understand the country’s legal standards.

Strong regulations are one of the reasons why many companies love outsourcing to the Philippines. The BPO industry contributes $30 billion to the Philippine economy each year. Therefore, the government is dedicated to supporting foreign companies in their country.

Wherever you outsource, it’s always important to be thorough in your research. Avoid assumptions, write clear NDAs, and read an offshore outsourcing software company’s terms and conditions diligently.

Offshore Outsourcing Software Development

3. Time Zone Differences

Project management can get challenging if your project team combines onshore and offshore workers. Onshore project managers might be asleep during your offshore team’s peak hours, which can lead to communication difficulties.

The good news, though, is that a good BPO company will be able to work the schedule you need, regardless of time differences.

Train your project managers to establish clear plans and guidelines for your offshore workers. Highlight your project requirements and when deliverables are due in writing. This way, the offshore development team can work independently without contacting onshore managers.

Of course, you don’t want to sever communication altogether. Onshore project managers who are working with an offshore team should perform regular check-ins. Pre-planned guidelines simply reduce the chances that your offshore workers will need their manager off hours.

4. Lack of Physical Presence

Many onshore employees have also switched to remote work. The business world now understands that physical presence doesn’t affect productivity. Yet, many executives and managers find it much easier to communicate with physically present workers.

You can’t force an offshore employee to book a flight to your onshore location, but you can make the most of technology to improve communication. Look beyond work emails and take advantage of tools like Slack, Microsoft Teams, Zoom, and other communication platforms.

Most communication tools have a webcam feature. They may not be in the room, but you can easily speak to offshore employees face-to-face. Plus, a worthwhile BPO company has the office space for your remote team to work from.

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As the outsourcing partner for a number of companies across the U.S., we have a 97% client retention rate and have helped many American companies reduce their labor costs by 50-70%. Fill more needed skill gaps for less money by offshoring with Remote Employee.

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Author Bio: Ruffy Galang

CEO and Co-Founder, Remote Employee

Ruffy Galang is a dynamic and forward-thinking leader in the remote work industry, currently serving as the CEO and Co-Founder of Remote Employee. With his leadership beginning in May 2022, Galang has been instrumental in steering the company towards innovative solutions for remote work challenges. His expertise in business development and management, honed over several years, has been pivotal in Remote Employee's growth and success.

In addition to his role at Remote Employee, Ruffy is the Co-Founder and Managing Partner at CORE Solutions since June 2018.

Before founding Remote Employee, Galang had an impressive career at Cloudstaff, where he demonstrated his prowess in business development. He climbed the ranks from Account Manager to Vice President of Business Development, a position he held from January 2020 to October 2021.

With a Master's degree in Business Administration and Management and a Bachelor of Science in Information Technology from Angeles University Foundation, Galang’s solid educational grounding has provided him with a deep understanding of both the technical and managerial aspects of running a successful business in today's digital world.

Ruffy's unique perspective on business is also shaped by his diverse cultural background. Having grown up in the United States until graduating high school, he then moved to the Philippines to pursue his college education. This bicultural experience has equipped him with an in-depth understanding of both Western and Philippine cultures, enabling him to effectively assist clients in creating successful offshore teams that are culturally attuned and efficient.