Nearshore Software Outsourcing: The Definition and Benefits
Explore tech partnerships based on closeness to the United States! Learn about Nearshore Software Outsourcing, providing geographical benefits, cultural harmony, and cost reductions.
Nearshore software outsourcing is when a company delegates software development work to a country close to their own. For companies in the U.S., nearshore outsourcing usually means sending work to software teams in Latin America or North America.
Some of the most favored nearshore destinations in Latin America are Colombia, Mexico, Brazil, and Argentina. All four countries have matching working hours with all time zones in the US.
Besides cost savings, businesses that opt for nearshore outsourcing are typically driven by the high level of programming skills and the value it brings to software products. Nearshore outsourcing providers also usually have the language skills and cultural harmony that makes tight collaborations run smoothly.
Why Nearshore Software Development is a Smart Choice
Hiring a nearshore provider for software development has many benefits over doing it in-house. Some of the main advantages are:
Filling Staffing Gaps
Nearshore developers have the know-how and the agility to work on software projects as needed. They can meet quality standards and adapt to your company culture easily, thanks to their experience with different clients.
Getting the Best Skills
Nearshore outsourcing companies give you access to a large pool of talent. You can choose the best experts for your project, without being limited by your own team’s skills. You also save money and time on recruiting and training new staff.
Having a common language and a similar work ethic is crucial for achieving project goals. Nearshore outsourcing eliminates any language barriers and ensures clear communication throughout the software development process.
Boosting Company Performance
Nearshore providers allow you to focus on your core business functions. Developing software internally can be overwhelming and prevent you from taking on new opportunities. Outsourcing reduces your workload and costs and improves your efficiency. A report by Technavio, a market research firm, predicts that the IT outsourcing market will grow by $409 billion by 2022, driven by the need to improve business processes.
Being Close to Your Provider
Nearshore outsourcing does not require physical meetings, but being in the same region as your provider has its perks. You can travel to them easily and cheaply if needed, and you can communicate with them at convenient times, thanks to the timezone alignment.
How to Find and Hire a Nearshore Software Team
If you want to outsource software development to a nearshore provider, you should follow these three steps:
Evaluate Your Team’s Skills
You need to know your internal team’s strengths and weaknesses before you outsource software development. A good way to do this is to conduct a staff survey and analyze the results. This will give you a clear picture of your team’s capabilities.
Once you have a project specification, you can create a shortlist of nearshore providers who have the skills you need. Reach out to each provider with your project specifications and ask for a detailed proposal of how they would handle the project. You can then compare their proposals and choose the one that matches your requirements best.
Check the Credentials of Your Shortlist
Before you hire a software development company, you need to make sure they have the expertise they claim to have. You can start by visiting their website and reading their case studies. You can also contact their previous clients and ask about their experience working with them.
You should also verify their reputation in the market by reading reviews on independent websites and following their social media accounts.
Set Up Project Management Tools
Project management tools are essential for managing and monitoring your nearshore project. You can use tools like Basecamp, Jira and Trello to improve your communication with your development partners and track their progress. You need to have a clear workflow and assign project managers and team leaders to ensure that deadlines are met and responsibilities are fulfilled.
How to Pick a Nearshore Software Outsourcing Region
Before you look for a specific nearshore software outsourcing provider, you should evaluate the country where you want to outsource. Some positive signs are a high level of digital skills education, a robust technology infrastructure and good English language skills.
Latin America is one of the most popular regions for software development outsourcing.
The region has a strong focus on digital skills in its colleges and universities and has close ties to the United States. Latin America also has good English language skills with an average EPI score of 50.33.
You should also think about the country’s business culture and how supportive the government is of the outsourcing industry.
After you choose a region, you should look at what each provider can offer. A good nearshore provider will show a modern, disciplined approach to software development. Ideally, they should have a track record of successful long-term projects with other clients.
From the start of your collaboration, the priority should be on quality assurance, with high testing coverage and smooth integration and delivery. By stressing the importance of open communication, you can increase the chances of a long-term partnership.
Joel Garcia has been building AllCode since 2015. He’s an innovative, hands-on executive with a proven record of designing, developing, and operating Software-as-a-Service (SaaS), mobile, and desktop solutions. Joel has expertise in HealthTech, VoIP, and cloud-based solutions. Joel has experience scaling multiple start-ups for successful exits to IMS Health and Golden Gate Capital, as well as working at mature, industry-leading software companies. He’s held executive engineering positions in San Francisco at TidalWave, LittleCast, Self Health Network, LiveVox acquired by Golden Gate Capital, and Med-Vantage acquired by IMS Health.