discover the strategic advantages of Offshoring IT! Benefit from cost savings, access to global talent, 24/7 productivity and technological innovations.
Offshoring is a practice that has existed for decades in all types and forms across various industries. But in the last few decades, it has skyrocketed in the IT industry, growing with the increasing digitalization of all existing businesses. However, even this phenomenon leaves many companies wondering whether offshore IT outsourcing is the way forward.
Of course, the answer depends on your specific situation, your plans and your strategy. There is no single answer for companies wondering whether they should hire offshore developers. But overall, there are good reasons to do so. Here we will check out the main benefits of offshore software development so you can see what you might be missing out on.
Why do companies work abroad?
There are many reasons to choose offshore software development. Companies use it primarily because it is a cost-effective way to develop high-quality IT solutions, a path to access a larger talent pool, a quick path to scalability, and the perfect way to find highly specialized professionals.
Offshore outsourcing is a great alternative for companies looking for specific expertise that may be more difficult to find locally. While this sums up why so many companies are hiring offshore software engineers, it's better to take a more complete picture to truly understand the growth of this practice in the IT landscape. So, let's take a detailed look at the 5 most important reasons for IT offshoring.
Access to expertise and experience
The increasing digitalization we mentioned earlier is happening in practically every company. While it is clear that there will be companies that will invest more in this than others, almost all are adopting digital solutions to some extent. This means they all need software engineers and IT professionals to design and develop these solutions.
Naturally, there are not that many engineers to meet this level of demand. This is especially true for highly specific and cutting-edge technologies such as cloud computing, AI, IoT or virtual reality. Therefore, companies have to compete for the same candidates, often stealing them from each other. This creates huge obstacles when trying to hire IT specialists, especially in certain countries such as the US or specific parts of Europe.
High cost-benefit ratio
One of the main reasons offshoring has become a business standard is that it allows companies to achieve greater operational efficiency at lower costs (when compared to using local talent). This continues to be the main selling point of the offshore model, even in the IT world.
The ability to cut costs comes from a few factors. Firstly, offshore developers are typically based in countries with developing economies and a lower cost of living. This means that companies can hire equally talented engineers as those in their own countries, but at more competitive prices. The other main factor is that hiring offshore teams allows companies to save on the costs of the hiring process and the costs arising from an employment relationship, as well as the costs of developing an infrastructure to support additional in-house employees.
Faster time to market
In a highly competitive scenario, where technologies can give companies an advantage, the rapid development of IT solutions and early arrival to the market may be the only way to stay ahead. This can be tricky, especially when the IT team is small, lacks the skills needed to handle a specific project, or is overwhelmed with daily or essential tasks.
Offshoring helps companies with this by providing talented software engineers who will work exclusively on their projects without distractions and delays. Since they are focused on the project at hand, developers don't have to deal with additional tasks or other clients. This way, they can work to complete the project on time and meet all necessary deadlines.
This can give any business a faster time to market as there are few obstacles or detours in the way. A dedicated team can also better resolve any issues that arise during development, as their only goal is to build the solution they were hired to build. Thus, an offshore IT development team can help a company gain a competitive advantage by increasing the overall speed of development.
Risk mitigation
Any development project has inherent risks – that’s a fact. There may be changing priorities, unforeseen issues, talent gaps, and many other issues that need to be resolved to complete the software. Fortunately, offshore development can help with this too. This is because the supplier shares the burden of any risks associated with product development.
Contracting companies are not the only ones interested in building the product on time. Offshore partners are also interested in this, because the work they put into this product will be part of their portfolio and could open up new opportunities for them in the future. That is why they are the first to safeguard the integrity of the project, ensuring the performance and general quality of the product.
This means they will plan the entire project down to the last detail to avoid any potential problems they foresee, making strategic decisions based on their own experience and knowledge. As issues will arise anyway, the offshore development team will work tirelessly to resolve them in the shortest possible time, thereby mitigating the impact of any existing risks.
The value of IT outsourcing
The 4 reasons above are what lead companies to hire offshore developers. Partnering with a trusted offshoring company can help fill gaps in IT, quickly provide the expertise and knowledge you need, deliver at faster rates, and even reduce the risks inherent in software development – all at highly competitive costs.
