Quick Summary:
Offshore software development has become increasingly popular in recent years, offering benefits such as cost savings and access to global talent. This comprehensive guide provides an overview of offshore software development, its benefits, and what you need to know to get started in 2023.
The software development industry is one of the fastest-growing sectors, and why would it not be when technologies are evolving at such a high rate? Regardless of which sector you operate in, staying technologically updated is the only way for a business to remain relevant and profitable.
Offshore software development practice has emerged as a savior for start-ups and SMBs. It enables them to hire experienced offshore developers for their software development projects at a nominal price, empowering them to stay competitive in the ever-evolving business environment.
If you are a start-up or SMB, curious to learn about offshore software development and how offshore software development benefits your business? This detailed guide is for you.
Here are the key takeaways from this guide
- What is offshore software development, and its importance in today's global market
- Benefits and Challenges of offshore software development
- How to hire an efficient offshore development team for your project
- Top countries to hire an offshore team from
So, let's explore the world of offshore software development without delay.
What Is Offshore Software Development?
Offshore software development is the process of hiring developers from an offshore country to build or upgrade software solutions. An organization chooses offshore development to hire technology experts that are relatively scarce and expensive in its local geography.
An organization usually reaches out to an offshore software development company with an extensive talent pool to hire offshore developers to scale their projects.
Recommended Read: How To Hire Offshore Developers [Complete Guide & Checklist]
Importance of Offshore Software Development in Today's global market
Offshore software development has emerged as a boon in today's rapidly changing global market. It has opened avenues for businesses to hire offshore software developers from any part of the world, creating a balance in demand and supply of resources. It has empowered companies, big or small, to get access to experts and build quality products with ease.
Simply put, offshore software development has become a crucial tool to thrive in the highly competitive market, and here is why:
Advantages Of Offshore Software Development
There are multiple advantages of offshore software development to a company seeking to build a successful product. Here are some of the top benefits:
1. Cost savings
A study has shown that businesses can save as much as 60% of their development costs when they offshore their software development.
How, you ask?
When you think about software development, two prominent costs come to mind: software developer costs & Infrastructure/overhead expenses. Offshore software development helps you with both.
Offshore development enables you to hire software engineers from third-world countries with low labor costs due to the low cost of living. Countries like India offer a large talent pool of experienced software developers at 1/3 price of the same resources in the USA or Western Europe.
A mid to senior software developer with 5-8 years of experience charges approx. $80 to $100 per hour. In contrast, a resource of a similar caliber in India would charge $30 to $50 per hour.
Hiring offshore developers eliminates the overhead expenses like infrastructure and system costs and employee benefits like gratuity, insurance, bonus, etc.; when you offshore your project, the team you hire from an offshore development company is technically their employee, so they are accountable for overhead expenses and infrastructure.
2. Access to global talent
Though the IT industry is growing globally, technology growth is inconsistent across geographies, creating a disparity in the demand and supply of resources.
Offshore software development empowers companies to hire skilled professionals across the latest technologies from different countries. It balances the talent market, allowing businesses to build agile and scalable teams of top-quality developers worldwide.
3. Increased operational flexibility
One of the most underrated advantages of working with offshore software development companies is the ability to scale your team as and when you like. An offshore software development company is home to a large and readily available repository of software developers across technology stacks that be quickly hired and deployed on your project.
Besides this, when you hire a team for software development operating in a geographical location with a big time-zone difference, you stand to gain around-the-clock project development.
When your offshore team has delivered the work for the day, your in-house team starts their day, giving them time to review the work and share the feedback before the offshore developers start the next day.
This ensures your project is being developed around the clock, reducing your time-to-market manifold.
4. Focus on core business
Today software is at the heart of all operations, whether in finance, consumer goods, automobile, or any other industry. Every business relies on software solutions to run its daily operations, but only some have the expertise to build or maintain software.
This is where an offshore software development team can do wonders for you. From building a custom mobile app & web development for your business, integrating new tools, to upgrading the legacy systems, they can take over the IT projects so you can focus on growing your business.
There is no doubt that offshore development is the future of the IT industry. But to say it is without risk and challenges would be far from the truth.
Let us explore the challenges one may face with offshore software development services and learn how to mitigate them.
Challenges Of Offshore Software Development
Below are some of the most common challenges faced while working with offshore development teams.
1. Communication barriers
Seamless communication is critical to ensure a smooth development process, but communication barrier is one of the most common challenges faced while working with offshore development companies.
Communication challenge arises due to two factors.
- Language barrier: It occurs when your offshore team needs help communicating in the same language as your in-house team. It is a common phenomenon when you hire offshore software development services from countries where English is not a primary language.
- Analytical Capability: Just because someone understands a language does not necessitate that they understand your project brief and requirements. Your offshore software developers' analytical skills are directly proportional to their experience and knowledge base and define their ability to comprehend and execute a complex brief.
Working with an offshore partner needing to catch up on the above aspects would create communication barriers and delays. A rigorous selection process for offshore development services providers, before you finalize the team, can help avoid this challenge.
2. Cultural differences
Cultural differences, like communication, are a common challenge when working with an offshore programming team. It can create difficulties in coordination, develop friction within teams and affect overall project management.
Conducting training to educate both in-house and offshore teams on the cultural nuances and creating well-defined processes and tools for communication can go a long way in eliminating these challenges.
3. Intellectual property and security concerns
The increasing number of cyber-attacks has made businesses wary of the growing threat to their data. The concern multiplies when working with an offshore development company.