From Local to Global: A CTO's guide to Offshore Software Development

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Thescalers
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The software industry is exploding with tech start-ups popping up left and right. **With over a million software companies expected to flood the market in the next decade, Western businesses feel the pressure of competition, high costs, and limited talent.** Luckily, offshore software development services offer a solution to help you gain an edge in this crowded marketplace.

In this article, we'll discuss offshore teams' advantages and show you how to integrate them seamlessly into your software development process.  So, let’s dive in!

## To start with: what is offshore software development?

Offshore software development is a strategic business approach that involves **hiring a team of skilled developers from different countries to work remotely on a project** or establish a new development centre. This model enables businesses to access a vast pool of talented developers worldwide, tap into specialised expertise, and reduce costs while increasing productivity. This approach is ideal for companies looking to expand their capabilities, stay competitive, and accelerate growth in the digital world.

## Outsourcing vs Offshoring

### Outsourcing

- **can offer cost advantages**
- **developers are not exclusively working for your company and may be juggling multiple projects for various clients simultaneously**
- **it’s appropriate for short-term projects without ongoing iterations and delivery**
- **developers are not part of your company and may not be aligned with your culture, values, and long-term goals**

### Offshoring

- **developers are chosen by you and work exclusively for your business**
- **the right offshore partner will handle recruitment, selecting suitable candidates based on your requirements, and provide you with a list of the best candidates for you to make the final hiring decision**
- **offshoring allows you to tap into talent and skills that are not available locally**
- **ideal for long-term solutions when you want to scale your team quickly**

## The benefits of offshore software development

### **1. Access to engineering talent**

Western companies are turning offshore for access to engineering talent, with over 250,000 software engineering jobs unfilled in the US alone. While offshore development is cost-effective, the availability of talent is the main reason companies engage developers in countries like India. Indian engineers are a hot commodity because of their extensive training and fluency in English. With 1.5 million engineering graduates annually, Indian developers are ready to hit the ground running and thrive in highly technical environments.

### **2. The opportunity to scale quickly**

Offshore software development offers the opportunity to scale quickly without the financial risk of hiring new, expensive employees who could leave prematurely. A business can withstand workload fluctuations more efficiently with a lower payroll and a team of offshore professionals. Plus, expanding an offshore team is faster than hiring locally. The Scalers have even brought in vetted, tested engineers to client teams in as little as four weeks.

### **3. A chance to focus on your core business**

Offshoring isn't just about saving money or getting access to talent—it's also about freeing up your time to focus on your core business. When you work with an offshore software development partner, they take care of all the administrative headaches like payroll, recruitment, and insurance. This allows you to concentrate on growing your business and interacting with clients. Instead of worrying about the logistics of scaling up your team, you can focus on developing new ideas, improving your products, and exploring new markets.

## The best locations for offshore software development

### India

As the IT offshoring capital of the world, India boasts the most developers, excellent training, and fluent English-language skills. With a lower cost of living, setting up offshore software development in India can be a very lucrative option for your business.

### Eastern Europe

For Western European companies, nearshoring to countries in Eastern Europe is a good option for constant, real-time collaboration with their in-house staff. Countries like Ukraine and Romania are known for having good developers, but political instability in the region may make some businesses hesitant to set up shop.

### Latin America

Offshoring to Latin America is popular among North American companies because of the minimal time difference. However, the developers' standard is generally lower than in other regions, and you still pay a premium for talented, experienced developers.

### The Philippines

The Philippines is an increasingly popular choice for offshoring, thanks to its growing economy, skilled workforce, and favourable business climate. With strong English proficiency and cultural ties to Western countries, it offers a reliable option for companies looking to outsource certain functions. The government has also offered various incentives and programs to support the offshore industry.

## Does offshoring create an ethical dilemma?

Offshoring raises ethical concerns, but the reality is different. Companies offshore because they struggle to find enough local engineers to scale and maintain quality. **Offshoring doesn't result in job losses but allows companies to choose globalisation and patriotism.** Globalisation benefits economies, and offshore development can increase economic productivity and improve services and products.

## Three tips on how to manage your offshore software development team

Maximise the benefits of offshore teams by building a successful partnership with an software offshore development partner you can trust. To manage your offshore team effectively, here are some key tips:

**1. Share the vision and mission of your company with your remote team.** Establishing a connection with your offshore team is crucial. The more they know about your brand, what you want to build, and why, the more invested they become in your company's vision.

**2. Bridge the cultural gap and foster a unified culture of belonging across your teams.** Make it your mission to ensure everyone contributing to your project feels included and a part of your greater vision.

**3. Communicate effectively with your offshore team** using channels like emails, instant messaging tools like Slack and Skype, and productivity tools like JIRA, Asana, and Basecamp.

Ready to take your business to the next level with offshore software development? Contact us today by filling out the form, and let's explore how offshore software development can help your business. Together, we can unlock new opportunities for success and growth!
sreekumar
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Excellent article! Very well described! Your article covers the topics of what offshore software development is, the difference between offshoring and outsourcing, and the benefits of offshore software development. Also highlights how software development is vital for business growth and success. The information shared is useful and will be valuable to many entrepreneurs and business owners. Great job, and keep up the good work! I look forward to reading more helpful stuff from you.
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