Why You Should or Shouldn’t Hire an Offshore Development Team

Every successful business startup faces the challenge of managing its business growth and expansion. In the ever-growing IT services industry, software companies are putting in a lot of effort to scale and remain competitive. As a result, these companies invest a great deal of time and capital to keep up with their game.

One of the standard practices employed by these companies is working with offshore development companies. In developed countries, most organizations outsource to organizations in developing countries to meet their demands of technical talent. Depending on their needs, the companies hire a few candidates or a whole team from abroad. Companies save a lot of time and costs, otherwise incurred in hiring and maintaining their staff locally by confiding their projects to a non-local team.

Certainly, this subject raises a few eyebrows. The hiring of an offshore team is particularly challenging if you’re a startup owner. The idea of working with a team that is thousands of miles away from your office sounds rather alarming, but it all comes to seeking options and choosing the right offshore team for your business. A wrong move would otherwise cause problems for you and your project. It is always a good idea to carry out a background check and look for the projects the team has worked on so far.

Companies get a chance to choose their team members from a pool of highly qualified and experienced IT professionals through offshore recruiting. The company interviews and evaluates the performance of individual candidates before hiring them in order to assess their level of competence.

Most offshore development companies are known to follow the agile methodology to generate highly customizable solutions. This methodology is driven by the principle of adaptability and response to change. Given the inherent complexity in the development of software applications, the process involves greater involvement and input than normal by stakeholders. The stakeholder’s requirements may change in the development process to accommodate additional functions, or the development teams may have assumed incorrectly what they wanted.

With an offshore team hired, both parties agree to work on common hours. A Project Manager serves the client by ensuring that everyone in the development team knows the objectives. Aspects like planning, scheduling, resource allocation, progress tracking, and risk control are handled through collaborative project management tools. There are hundreds of Project Management Software available in the market, many of which are free to use. Most of the organizations trust Trello, JIRA, and Asana.

It’s essential to maintain an open and effective communication channel through tools such as Skype and Slack to make the process more transparent.

According to IT outsourcing statistics and findings provided by Consumer Economics, the overall percentage of the typical IT budget going to outside service providers has risen significantly in 2019. More and more IT organizations are committing to outsourcing some of their internal operations and are relying less on in-house skills to meet their service goals. Outsourcing in 2019 accounts for 12.7% of the total IT budget on average, a steep increase from the 9.4% figure from 2018.

We will share some insights into why your firm should hire an offshore development company/team and why not.

There are tens of millions (and growing) software developers to choose from across the globe which is a huge plus. In India alone, about 1.5 million engineers are released to the job market every year. If a company can research and recruit properly, it can lay its hands on some of the best English-speaking software engineers in the world.

Every business decision directly or indirectly comes down to the cost. With the higher cost of living in the US and several European countries, the employees demand a higher cost to live and as a result higher salaries and cost per hour. The software teams in offshore countries are known to deliver results at a significantly lower cost as compared to an in-house team in these countries. This helps the company use the surplus capital in other areas of their business.

Many offshore companies allow full-time hiring of their candidates remotely. These candidates follow the company’s procedures, which they work for and even report to the same company directly. This model eliminates the hassles of recruitment processes and training the candidate. There is no need to make room for the new candidates or team.

Given that you’re outsourcing to a team that is literally thousands of miles from your workplace, you cannot be there with your team. This means you are not able to actively monitor the progress of your product personally. There’s nothing like a leader’s physical presence which adds value to the team and encourages them to meet the goals.

You may very well not speak the development team’s native language residing in a different country. In most countries abroad, people are taught a language like English in school rather than learning it at home. Overcoming the language barrier can be an upward challenge, especially if you don’t choose the right outsourcing venue.

Without a proven track record, it’s difficult to build trust with people who you have never met or seen in real life. Developed countries in Eastern Europe and the US usually have a critical approach to finished product quality. Perhaps what your offshore team may call high-quality might not be up to your mark.

To communicate and collaborate with an offshore team, the company has to rely on technology. Slack and Skype are two of the most popular communication tools with audio and video calling facilities. Skype even comes with a real-time text and voice translator with support for some of the popular languages. It’s always a good idea to use simple language and avoid using metaphors that the off-shore team may not understand.

India has always had an advantage in outsourcing because of the prominence of the English language in the country.

The challenges posed by time-zone differences can be resolved beforehand by addressing the team’s tasks. A Project Manager serves as a bridge between the client and the development team (also referred to as the scrum team) who communicate frequently.

Using overlapping working hours to address any concerns between the client and the project manager or the development team also help alleviate challenges posed by time-zone differences.

Working hours in:
Sweden (and most EU countries): 9:00 AM to 5:00 PM
India: 9:30 AM to 6:30 PM

The working hours are maximized so that products can be more scalable and quickly developed and delivered.

Clearly, hiring an offshore software development team has its own challenges. We have listed five important tips below to help you better manage your offshore team.

It’s extremely important to set very clear requirements and project goals at the very beginning of the project. You must provide your internal and offshore development teams with a clear vision you wish to achieve through your product because merely assigning the tasks won’t cut it. If they can’t see the bigger picture, they may fail to satisfy the necessary goals and your product may lack in critical areas.

Think of your internal and offshore development teams together as a close-knit family. The offshore team is not the team you outsource a couple of projects to, but rather an extension of your existing team that you may need to work with for a lot of projects in the future. It only makes sense to keep aside the hierarchy and treat your offshore team as a partner.

It’s advisable that your remote team uses the same set of software tools that you use internally. It will help you avoid errors and compatibility issues. We recommend Asana, Jira, or Trello for Project Management, Figma for design, and Slack for communication. These tools automate workflow management and facilitate collaborative teamwork.

With tools like Slack and Skype, you can easily communicate with your remote team but it’s still important to connect with them on a human level. Cultural and time-zone barriers could make it even difficult to understand them – but you have to be patient and get to know them on a personal level. Who knows maybe you both love the same music or like to talk about football in your breaks. Not only will it make work more fun, but it will help you lead your team better.

In any business, trust is the glue that binds employees to employers, customers to companies, and companies to their investors. By avoiding micromanaging, you’re avoiding the risk of losing trust with your team. It’s unnecessary to watch your team’s every move. Your team will feel like they don’t have freedom in their job. Besides, micromanaging is known to affect performance negatively.

Make quality the deciding factor, not distance.

India has become the fastest-growing tech hub in the world with hundreds of companies outsourcing development in India. Thousands of IT services companies that were built over the last three decades in India have generated more than US$ 135 billion in exports in FY 2018 – 2019 alone.

To sum it up, working with an offshore development company can be highly profitable for your business if you have defined your outsourcing goals clearly and chosen the right outsourcing team. Technology is making the world smaller and the gap between onshore and offshore teams is waning.