Are you ready to turn your idea into reality? Do you want to start your company with an offshore team? That’s great. This blog will guide you through the process.
Whether your startup is in growing stage or on the way to gain recognition, it’s necessary to choose strategies wisely and plan the roadmap effectively. However, being short of resources, it becomes a bit difficult to do everything by yourself.
Moreover, startups often have a limited budget. Plus the stress to expand the business can become a distraction and roadblock in the success. To avoid such a situation, entrepreneurs often collaborate with an outsourcing partner or plan to start their company with an offshore team.
Before we understand the process to start your business with an offshore team, let’s discuss the need to outsource!
What is Outsourcing?
Software Development Outsourcing is when a company decides to choose to hire a team of third-party developers so that they offer services related to software development. As they hand over important business processes to the third-party, companies can then manage the complicated jobs.
Depending on the type of your startup, here is the list of professionals you may need to start your company!
- Graphic Designers
- Accounts Manager
What is the Need for Outsourcing?
According to Statista, in the year 2018, the IT outsourcing turnover was estimated to be 378.1 billion U.S Dollars.
As an entrepreneur, you may be very talented having a good amount of knowledge and skills that help you in managing multiple tasks of your company. Because you have to perform multiple tasks, there is a possibility that you may get stressed out or commit an error.
90% of the companies cited outsourcing as an important part of their growth. Source: Economist
Working with an offshore team doesn’t have to be difficult or stressful. What you need is goodwill and business planning. You must have plenty of questions in your mind like:
- Will the team be productive?
- Will I be able to grow with the remote team?
- How will I manage a team from my location?
- Is it possible to integrate for the team in our company’s culture?
Thinking about these are normal. Here are the reasons you should consider outsourcing team of developers.
1. Offshore Developers give you a Head Start
When you are outsourcing your marketing, you know an experienced team is running your campaign while giving you a head start. Otherwise, you would have been under pressure, feeling how to develop the project and how to market it successfully.
2. Hiring Is Hassle-Free
While you feel hiring in-house is beneficial, you may be missing a lot of talented people living in different countries. When you hire offshore developers, you are getting the best of the best from across the globe and not just from your own country.
There are only a few trustworthy outsourcing companies to choose from, and the best one will certainly offer you a team of developers that work with you. The team has to clear the screening process with several intense interview stages and problem solving before you actually hire them.
It is the best option as it gives you an amazing opportunity than limiting yourself to a single local pool of talent.
3. Less Money, More Profit
This is a fact that almost every start-up has a limited budget, so the most important practice consists of cutting the cost as much as possible. You may think hiring an in-house developer is a cheaper way, but that is a myth.
This is because when you employ developer at low costs, you are risking the hiring on the inexperienced people. This may further lead to higher cost in the mid long term and having the possibility to end with an unpredictable outcome.
On the other hand, you have experienced professionals when you outsource and thereby reap benefits for having high profits from their services.
4. Get Benefit from their Experience
Collaborating with the outsourcing company gives access to not only great people but with an experienced team of developers that help make the product and services better.
The outsourcing team has been in the market for years and worked in different verticals. So, they are well-versed with their job. You can make a profit from the ability and completely understand the needs and challenged to ensure they will come up with what you require.
Take into account that both companies can learn from one another while making a good business relationship. They share their experiences and point of view, and this certainly helps in building a healthy outsourcing partnership.
5. Scaling Up And Down
Hiring offshore developers is one of the best and most efficient ways to ramp business, and this makes it vital for start-ups.
Tech Startups experience high pressure, cut-throat competition, and the capability to be active and reactive is hampered if they go for in-house developers. Being under severe budget constraints, they can spend enough money on marketing to rank on the top.
Moreover, hiring developers having years of experience for their office premises is also not practical as most of them don’t prefer working with a startup.
On the other hand, you can easily hire dedicated offshore developers for startups about half a quarter of the cost of hiring the in-house employee. Hiring someone from another geographical location can take only a few days, unlike hiring in-house developers take months.
The outsourced team doesn’t have to own a share in your company nor utilize the resources. They will just take the job, do that efficiently, and move ahead. This tremendous speed can be incredibly advantageous.
Also, scaling down is just as quick as scaling up is.
Your company can stop taking the services from the remote team just as quickly as you hired them. This is an easy way to focus, give time and resources to one project.
Plus, if the tech partner has done a good job, you can re-hire them for your next project. Moving on…
6. No Worries if Someone is Leaving
Hiring an in-house employee is expensive but losing an employee to another job opportunity is way more costly. Not only does it cost money, but not having the resource means the project will fall behind.
Whenever you outsource your marketing to the professional offshore development team, it is guaranteed that your campaigns will run on the scheduled time and it will be completed before the deadline.
7. The Marketing Stay Current With Trends
In the tech industry, practices change, so does development platforms. All these changes make it difficult to keep up with the trending trends and prepare your company beforehand on what is coming. This is important for startups as they don’t have experience in the marketing phase.
Handing over the project to the experienced professional’s means, they will keep up with the existing trends and keep you prepared with the future requirements. This certainly helps you stay on the top.
8. Boosts Productivity and Efficiency
Every new business involves heaps of tasks that have to be carried out. If you hand over your tasks to an offshore development center, you can focus on important things.
Efficiency increases when tasks are prioritized and pre-scheduled. You can trust the company while they do the tasks while you can get involved in planning, strategizing and raising funds.
This is the best way to ensure that everything is done in the right way so that it has higher productivity levels.
9. Flexible Pricing Models
There is a doubt that outsourcing is the most cost-effective option available. The top outsourcing agency delivers quality development services of the comparable quality at a way lesser price range.
Most importantly, the pricing models are very flexible. You can pay the team on an hourly basis for one project and fixed price for another one. When you have an in-house employee, what matters the most is the salary. Your startup has to provide them with a fixed salary regardless of the type and quantity of the projects they have.
When you outsource your work, you can get connected to a pool of developers whose prices have not been increased by the market.
As development skills are in great demand nowadays, most companies prefer to hire Indian developers so that they get quality services.
10. Time Optimization
When your startup works with a dedicated offshore team, it helps your startup save time in different ways.
When new expert developers are hired, they take a lot of time for training and adopt the culture of your company. You will definitely save a lot of time if you recruit remote developers from another location as they are already well-trained and experienced. They know how to do the job faster because they have years of experience.
11. More Time for Core Objectives
The company culture is nice; it still doesn’t prevent burnout. It undertakes sprints and requests plenty of overtime from the in-house professionals because the project deadline is near. The productivity level of the team drops down if they are pushed towards a task forcefully. In this case, outsourcing helps to mitigate the problem.
You can outsource anything and everything and reserve only the most critical tasks for yourself. Apply more energy on the vital objective, and you can complete them as per your pace.
Time and effort is not the only thing.
Outsourcing team is invaluable to your startup, and they complete the tasks and the project well before time. They work as per their flexibility and still deliver quality results.
Steps to Follow When You Outsource
The process of looking for a technology partner is simpler than recruiting a team of in-house employees. Here are the outsourcing steps to follow:
1. Task List and Project List
Have a clear idea of what projects you would like to outsource. If you are unwilling for Project Outsourcing, you can outsource a few tasks.
Make sure you list each task individually giving a detailed description of them. This simply means you don’t just have to jot down, ‘new graphic for a blog post’, but also the blog topic and what type of image are you expecting. Make a table that gives details about when was the task allotted and what is the deadline. This will certainly help minimize confusions and delays regarding accountability.
2. Non-disclosure Agreement
Compile a policy document that has a non-disclosure agreement. This should have all the confidential information. Make sure to describe the highly confidential information that should never be disclosed to a 3rd party and sensitive information that can be disclosed with NDA. Both you and the offshore team members should have a thorough understanding of this policy.
3. Detailed Specifications
Provide remote developers the detailed information and requirements. The more specific you are, the more they will deliver as per your expectations. For something creative, don’t forget to send them the creative brief every time.
4. Follow Up
Set aside a particular time frame to interact with the offshore technology partner. Review their work from time to time and if there are any changes you feel are to be made, don’t hesitate to spread the word. Remember, all the freelancers are not in the same time zone, so it may take hours to receive a response from them. So, make sure both of you are in sync.
To enable the success of your project, a few functional areas need constant monitoring, and here they are:
- Cost management
- Communication management
- Performance management
- Risk management
- Crisis management
- Knowledge transfer management
- Relationship management
Recommended Read: 7 Things Startups Should Know About Outsourcing
How to Choose the Best Outsourcing Company?
Outsourcing companies work differently and they take advantage of varied technologies. Consider the following before hiring them:
1. Pay Attention On Their Work Process
A good offshore development company not only writes quality code but also understand your business requirements. To develop a product or service that brings profit, they should have something exceptional. Ask them for a well-designed plan of the project development phases and execution.
The right approach is the lean approach where you, as a start-up improve on your value proportion and not the way the final product is built. This clearly defines that instead of committing time, money, and efforts in developing a product, a minimum viable product is created as per the recommendations and requirements.
If the offshore company understands the approach, it will help you create MVP effectively while making the time-to-market even shorter. Allow the company to showcase its approach and evaluate if this is what you were looking for.
2. How Your Startup Will Work With Them?
It is quite important to check the framework of the company you have decided to work with.
Terms to remember: Agile & Scrum
The work methodology should combine IT outsourcing and project flexibility with the best practices. It is important to ask them how soon you can expect progress. If the company works in shifts, expect the new working version of the product and the changes that are implemented. Make sure everything is functional, clear, and visible.
Consider the product or service you will be getting. One key aspect of a good outsourcing agency over the bad one is the quality of the product that they deliver. The team achieves it via the complete development process while selecting the right tools, using continuous integration and deployment, code quality.
3. Calculate The Final Cost
If the company ‘A’ charges $30/hour and another company B has $80, which one will you choose?
When you dig deep, you will know that every outsourcing firm has a different price range. The cost of the company depends on the geographical location, experience, worth methodology, technology stack, and a few other factors.
Do not only keep the cost factor in mind while deciding the outsourcing company but also gave an insight into the services they are offering.
India is one of the best countries when it comes to hiring dedicated developers as the per hour cost is very less compared to others.
Recommended Read: How Much Does it Cost to Hire an App Developer?
How to Manage the Offshore Team?
Don’t make managing offshore teams complicated. Consider the following points to establish a productive, long-distance relationship with the outsourcing team.
1. Bridge The Cultural Gap
Become a good client and outsource your project successfully.
Always keep in mind that you have to be transparent with the outsourcing company. No matter how good the tech partner is, the project will be a burden if you don’t have time and energy to make it work.
2. Focus on Communication Skills
English is a global language. Whether a member of the team works on development or data processing, they need strong language skills to understand everything.
3. Designate Team Leaders
The outsourcing team is self-directed with the location-specific team leader who will take care of the tasks on a regular basis. When you are working with the remote team, it becomes impossible to have a watch over everyone, every time.
So, it is good that you appoint team leaders so that they efficiently monitor the workflow.
Tip: Make sure you select someone who possesses strong technical skills and leadership qualities.
4. Develop Communication Forums
When you have a global team setup, it is very important to have crystal-clear communication. Take the help of virtual tools to communicate with the team members.
- Email: Use it for official communication and scheduling.
- Chat: For quick doubts, status updates or other clarifications
- Video Conference: Take help of Zoom, Skype and GoToMeeting
- Project management: Basecamp, Trello, and Monday.com help in tracking and managing the assigned tasks.
5. Build A Corporate Culture
The core value of an organization, the behavior, and relationship within the team is the foundation. It is important to create a culture so that the remote team feels they are part of the business.
The team should be treated in the same way as the in-house team. Whenever someone steps out of the comfort zone to accomplish requirements, make sure you pat their back for the hard work that they have put in.
6. Use Shared Calendars for the Overlap Time
The different time zone is one of the biggest issues with outsourcing. There has to be a minimum of two overlapping hours for the real-time exchange of information.
Take help of Google calendar and keep track of the local holidays and leaves of the employees.
7. Employ Source Code Repositories
When you are working with the outsourcing team, it is important to employ a common source. Make sure all the team members are taking the help of the latest source code so that there are no conflicts.
8. Schedule Weekly Meetings
Schedule a meeting with the members of the outsourcing firm. Arrange a weekly meeting with the team when all the members are available. Discuss the progress, the updations, and analyze issues faced in the process.
9. Emergency Numbers
There should be an emergency number for the project managers of the remote team and your company. This should be available to all the partners. This is important as both can contact directly and ensure that they will be available in case of emergency.
This is a technology-driven world where you have to be creative, productive, and tenacious at the same time. For all this, outsourcing can become your master key.
Move ahead, step by step as you don’t have to implement everything all at once. If you genuinely want to be successful, expand the offering to your clients, there is no better way than outsourcing. Working with the offshore development team, your product or service will certainly hit the market in a shorter time frame and generate more revenue.