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Software Offshoring

ZirconTech Top Developers Clutch Argentina 2021

 

As found in the latest studies, global blockchain technology spendings are expected to climb to as high as $11.7 billion by 2023. Compared to other dominant development markets, blockchain is relatively smaller but its growth is undeniable — because, by 2024, the number is set to jump to around $20 billion.

 

Here at ZirconTech, we want to help you transform your business through bleeding-edge technologies like blockchain development. Located in Buenos Aires (Argentina) and Montevideo (Uruguay), our team works with companies all over the world, bringing efficient and cost-effective solutions for their unique needs.

 

In honor of our team’s hard work, it’s a massive honor for us to be highlighted as a Clutch Leader! In the most recent Clutch Awards, ZirconTech was given the title of Argentina’s leading blockchain development company for 2021!

 

Clutch is an established B2B market research and review company that helps businesses connect with the right service providers. Every year, the site ranks the leading firms from their respective industries during their awards cycle.

 

The entire ZirconTech team would like to express their heartfelt gratitude to each and everyone who made this possible. We sincerely dedicate this win to our clients, most especially to those who graciously endorsed and reviewed us on Clutch.

 

Moving forward, we want to see what else we can achieve. The future is filled with unknowns but together with our clients, we can continue growing and conquering hurdles.

 

Work with a trusted technology partner! Work with ZirconTech to build your digital transformation! Contact us today and we’re excited to hear from you.

 

ZirconTech-Management-Team

In a post pandemic world with hybrid work environments, ZirconTech aims to consolidate the global expansion delivering nearshore solutions and services in blockchain technologies and integrating cloud computing, DevOps, data science and artificial intelligence.

 

New York, Buenos Aires, Santiago, Montevideo, September 27th, 2021. The Board of ZirconTech is pleased to announce today that Andres Zunino has been appointed CEO of the company. An experienced business leader, who will lead the company strategy and growth, in order to consolidate the global expansion and assume responsibilities on October 1st.


With a background in Civil Engineering and Business Administration, Andres has developed a career initially in infrastructure companies and then in the telecommunications company Ericsson in the operations in Latin America, where he oversaw the operations in several countries. Andres started investing in several startups in 2015 with interest in emerging technologies, and in 2016 co-founded ZirconTech in the blockchain space with the domain expert Alejandro Narancio, CEO of Infuy. Andres completed an MBA in IEEM (University of Montevideo) and has extensive experience in telecommunications, mobile networks deployment and operations, large project implementations and financial planning. Andres has been involved in Ericsson operations in Latin America working with the most important telecommunications operators in Argentina, Chile, Peru, Colombia and Uruguay.
So far he has been leading the management of the operations while Alejandro Narancio advised and guided the team from a technical point of view. In this journey, with central offices in Buenos Aires and Montevideo, ZirconTech grew and expanded customers to Chile, Ecuador, Colombia, Unites States, Canada, United Kingdom, Spain, Portugal, Switzerland, Singapore and New Zealand, among others.

 

Andres Zunino CEO ZirconTech

Andres Zunino – CEO ZirconTech

 

In 2016 Andres and Alejandro founded the first professional services company focused on blockchain in Uruguay. Pioneering in the technology and with the support of ANII (National Agency for Innovation and Research of Uruguay), ZirconTech implemented a blockchain usage based insurance solution which in 2017 was shortlisted in the top ten applications in the Swiss Blockchain Competition organized by the Crypto Valley Venture Capital (CV VC).

 

While developing multiple blockchain projects involving different technologies, ZirconTech has been a pioneer in legal tech and a key partner of Monax, a UK and global leader in digital contracting using smart contracts; has developed a blockchain based notarization tool for many use cases and partnered with key blockchain platforms among other initiatives.

 

As part of this new organization restructure, Alejandro Narancio will serve in ZirconTech’s board as technology advisor while he continues leading the specialized nearshore company Infuy as Chief Executive Officer. Alejandro is a thought leader in blockchain technologies, international speaker, university professor, RSK Rootstock ambassador and RIF product owner. Before co-founding Infuy, Alejandro worked for Tata Consultancy Services for several United States financial services companies, spending extensive time at onsite operations in Minneapolis, Miami, Los Angeles and New York City.

 

Martin Machin, who had joined ZirconTech as board member by mid 2019, will focus his role on digital innovation, data science and artificial intelligence services. Martin is a mentor, investor and advisor to companies in information and emerging technologies, and previously was managing partner in Pyxis, the fastest growth IT company in Uruguay in the last decade, expanding to Latin America and North America. Before that, Martin led the Global Delivery Center of Tata Consultancy Services in Montevideo and was Head of the Banking, Financial Services and Insurance Area of the operation. He also worked at IBM, Conaprole, and Banco Comercial which was later acquired by Scotiabank, and was Artificial Intelligence professor in the Universidad Catolica del Uruguay.

 

Martin Liguori, Co-Founder of Infuy, has been working in ZirconTech supporting the service delivery and now will be promoted as Chief Operating Officer. Before co-founding Infuy, Martin worked in Tata Consultany Services delivering services to global customers. He has extensive experience in web application development and cloud infrastructure in mission critical operations.

 

Williams Olivera, a senior software and solution architect who has been leading several global projects in ZirconTech has been promoted to Chief Technology Officer and will guide the technology strategy. He has been involved in key global projects in ZirconTech and has performed a key role in the competency development in different blockchain technologies like the evolution of Ethereum into Quorum, Hyperledger, Hedera/Hashgraph, R3 Corda, etc. He was one of the first R3 Corda Certified Developers in Latin America. Williams is a Computer Science engineer who previously worked in the leading IT company from Uruguay Codigo del Sur.

 

The world has become a global village that offers a variety of opportunities for companies to experiment, execute, explore and grow. In a capitalistic market, it becomes really important for any company or service provider to stay and compete well. For most of us, 2020 has been uncertain, and it reduced the chances for individuals to learn and grow. The business processes saw a major setback in terms of development, collaborations, partnerships, and providers.


Nearshoring is a type of outsourcing that requires businesses to appoint certain processes, such as development and testing, to make them efficient and reduce costs. Companies based closer to the same time zones will share similar working hours and similar cultures. By being geographically nearer, a foreign company or a service provider can offer a reliable and stable connection to the parent company.  


Cost measures have always been really important and with the delegation of major activities to neighboring countries, companies can shift their focus on other business activities and turn the table towards exponential growth.


What is Nearshore Outsourcing


Nearshore Outsourcing is a practice to get the work completed using a set of services provided by the neighboring countries and not the organization’s native country. For example, any North American company would move some of its operations to Mexico or Uruguay for getting access to a wider pool of talent, cultural similarities, skills, and lower salary costs. Factors like lower language barrier, time zone compatibility, and mutual cultural understanding would enhance productivity. And this adds up to the company’s profile and offers amazing new opportunities.


The Rising Trend in the Global Market



Outsourcing follows the logic and economic principles of Adam Smith who changed the horizons by studying the divisions around labor. When we chunk a set of complex tasks into specific skills and assign them to individual workers, they specialize in that particular area and become more productive. Adam Smith with his productivity and economic theories turned out to become ‘The Father of Capitalism’.


The recent global pandemic forced several people to build their companies in-house and realize the importance of outsourcing, specifically nearshore outsourcing. The future of work is digital and the bots are automating most of our daily tasks. Social Media management would grow leaps and bounds, and according to a report generated by Forrester, it would experience a hike of at least forty percent. The current global situation demands the Business Process Outsourcing (BPO) partners and IT partners to possess hybrid capabilities. 


“What organizations are looking for now is a flexible partner,” said Barbara Hodge, principal analyst and global digital editor at Shared Services and Outsourcing Network (SSON), a professional network. “Critically, that means the ability to move seamlessly from traditional office environments to work-from-home (WFH).”


There would be some key points that nearshore clients and providers would look after which would add up to the future trends and charts. Let’s have a quick look into them:-



  • Company’s Culture and Diversity


Culture defines the ambiance that any company would carry. The more cross-culture/similar-culture diversion exists, the more openness it generates. Nearshore clients should actively engage with the outsourced teams to build an interactive cross-funcional objective towards a shared mission. It paves the path for the creation of better communities and safer workspaces that cherish both, the culture and work together. 



  • Regular Benchmarking


Cost-reduction strategies and price benchmarking should be the primary goal for nearshore clients in the upcoming years. Everyone is shifting towards automation and artificial intelligence nowadays. All the BPO and IT services have shifted to automation mostly. Machine Learning and Data science have made the market more cost-effective and super reliable. Regular benchmarking provides a platform for nearshore outsourcers to explain their value to clients and build significant relationships.



  • Distributed Computing and Secured Solutions


Freedom from the location is the ultimate goal for the nearshore providers, and they have started investing in cloud technologies to achieve that. The exponential trend would be a decentralized framework with multi-cloud technologies. Nearshore providers are looking for a decentralized data model, instead of central data providers, that are moving towards a less network congested area, with a potential towards apt data clients. 


Enhanced cybersecurity in the nearshore would help in data security and business management at an outreaching scale as well. These technical advancements and approaches would help the nearshore outsourcers to achieve the maximum nearshoring benefits and profits.


Nearshoring Services



Software outsourcing has proven to improve quality and increase focus and reduce costs within the company. Most successful companies in the world used the principle of outsourcing to excel, whether that be a data service or web development. The top companies that are competing extremely well are doing so simply because of nearshoring.


Let’s look at some examples:-



  • Google


The ubiquitous search engine earned a revenue of $26 Billion from 2016 to 2018, however, most people don’t realize that the foundation of their outrageous profit margin is outsourcing. In 2014 the company was outsourcing most of its nonessential IT functions to various countries. Google used a strategy to utilize resources from abroad via the method of outsourcing. This helped Google to achieve maximum developers output in its team and attain the highest potential of itself as a company. 



  • Github


Millions of users use Github as a collaborative tool to share codes and build products. Microsoft acquired Github for $7.5 Billion in stock because they used the maximum benefits of outsourcing to create their network. They conducted this IT outsourcing to achieve the highest talented potential. They filled their company’s skill gaps by hiring experienced professionals who built their entire backbone.



  • Whatsapp


Whatsapp relied heavily on outsourcing software for its core development. The office maintenance was done in the United States but the complete app development was outsourced. They hired a whole team for iOS development via outsourcing to enhance the existing skillset. iOS app development helped the app cross milestones and it contributed to the company’s success as a whole. 



  • Slack


It is a popular communication app used by maximum workspaces when a task like app-designing is outsourced. By nearshore software outsourcing their logo creation and marketing design, the company streamlined its imperial product.  Slack was able to establish a brand because of outsourcing of the app and web design. It helped them raise a $250 million round of investment with a valuation of $5 billion. 


There are several examples like Opera, Alibaba, Skype, and many more who used the power of nearshore software outsourcing to upscale their company. They realized the execution of the principle which added a crest to their company valuation in the long run and helped them become a gigantic name in the industry.


Difference between Nearshore, Offshore, and Onshore


Nearshoring


Nearshoring simply means outsourcing business processes to nearby nations. Business development needs smart solutions and nearshoring helps them to create a better pool of services using global talent. In contrast to offshore development, crucial nearshoring benefits are – seamless communication, better deals, and fewer cultural differences.


For example, USA-based companies would prefer nearshoring with Latin American countries such as Uruguay, Costa Rica, and Colombia. It is less expensive and provides effective working relationships. You can visit your team from time to time to those places and ensure whether the process is being taken care of in an organized manner or not. 


Offshoring


The operational activities are transferred to another country via offshoring. It has two types: 



  • Nearshoring (in the nearby countries) and

  • Farshoring (to distant countries)


Reducing personnel costs is the primary goal of offshoring. Technical barriers such as poor internet connection present a major challenge in these types of situations. It is vital to note that the contractors’ location is a major difference between nearshoring and offshoring.


Offshore software development yields successful businesses over time since it is located on another side of the globe, which is cheaper. Companies can hire an expert team at lower costs and access a global pool of talent. The right offshore company can assure you a wider range of services and deliverables provided under stricter deadlines. 


Onshoring


Onshoring is the process used to relocate any business to a new place inside its nations’ borders. It results in the quickest possible services and improves agility and cost structure within the organization. Product management becomes a flexible process, from manufacturing to supplying.  For instance, a company located in California will onshore to New Jersey. Here, the states are different but the country is the same. Communication, language, timezones would fall in one place, however, if you plan to reduce the development budget, then this won’t help.


Nearshoring Benefits




  • Easy traveling due to close distance


The close proximity of the country makes it more feasible for the teams to meet, which helps in building business relations, improving coordination, and creating social bonds. Also, these kinds of collaborations help businesses to build good relationships with neighboring countries and governments.



  • Cultural Similarities 


The cultural similarity is the key to nearshore development and partnerships. Because having almost the same lifestyle and spoken language enhances the belongingness within business teams. Instead of having teams with various cultural beliefs and language barriers, companies can opt for nearshoring to similar countries to theirs. In addition to that, this also creates a sense of trust between both the parties in their partnership.



  • Reduced Operational Cost 


Nearshoring reduces operational costs as we hire resources at low charges but with the same skillset and work efficiency. This eventually leads to maximization of the profitability of the business instead of having business with a country that is far away from your current location. To some countries, the traveling cost is high as the distance is larger, but in the nearshoring, the distance is less, which leads to lower cost of traveling, considering we’re paying lower wages for the same work, which leads to maximization of profit.



  • Time Zone compatibility 


Having close proximity with the neighboring country makes it easier because of lesser or no difference in time zones. In the case of offshoring, the time difference makes the work less efficient and creates a difference of almost 12-24 hours. However, with the neighboring country, it is easier to communicate and work accordingly because of similar working hours.



  • Improved Code Quality 


Nearshoring helps in improving code quality as you are hiring a professional and high-quality development team with comparatively less price, which is very hard to find in your native place, due to the developed economy. 



  • Saves Time and Energy 


When you hire a nearshore development team, they start working within days, sometimes hours, which helps you to save your time, money, and energy instead of recruiting candidates natively. In Nearshore development, teamwork with professionals is smooth and it gives better quality results because they were hired for that specific task. This helps in scaling up the product quality and improving the overall productivity of the team.



  • Compensation of staff shortage


Whenever any company faces a staff shortage, Nearshore development teams are the best option available to fill the requirement. It takes lesser time, lower cost, and more proficient work delivery to the clients. This leads to the upliftment of the company and helps in the shorter run to grow fast.



  • Improving company efficiency


Nearshoring helps in improving efficiency and saving time for in-house employees and helps them deliver the projects faster. An outsourced team can take care of the mundane tasks while the core team can focus on the bigger picture and improving product quality. This enhances the efficiency of the company because the outsourcing team plays a vital role in software development which helps in distributing the large projects.



  • Access to global talent


Nearshoring means access to global talent and skills. When you hire a nearshore development team, you get to know their previous work and achievements. Connecting with them creates a bond that helps you to grow your network worldwide. Directly or indirectly, it helps you and your company to see things differently and find new and creative solutions to your problems.


Conclusion



Management and consistency are the keys to nearshore software outsourcing. A poorly managed outsourced resource would not be beneficial to the company, instead, it would add towards a higher risk of job loss within the organization. The organizational trust would be at risk if the employees feel that their jobs are threatened because of outsourcing.


Transparency should be kept intact while outsourcing – whether it be nearshore or offshore. 


Nearshore outsourcing can offer at least 30% of growth to markets by the end of 2022. It has broken European charts with a fine curve and reaching substantially larger audiences. The Nearshore development service market has enhanced standards in terms of quality and quantity. Companies can now involve themselves in innovations and build across strategic partners and teams.


offshore software development rates nearshore software development

Our goal with this article is to help you make your business grow using offshoring software development. Firstly we can agree that offshore development is the same as outsourcing, and the central part focuses on getting the best offshore software development rates.

In this context, you’re sending your software development to be done by people located in another country far from your business. Some software business managers could see ‘offshoring’ as a risky maneuver, but reality says that more software development companies trust this modality year after year.

Some of the reasons some businesses recourse to outsourcing are the lack of human resources or lack of needed qualification level within their own company. So, businesses with this need to search for a trustful third-party offshore development company with reasonable offshore software development rates that can help them. 

Most software development’s outsource tasks are mobile and web app application development, data management, blockchain, or AI development. By outsourcing, you don’t need to hire and train new staff, and at the same time, you can be sure to get the best quality software delivered to you at the accorded rates and terms.

You can trust the effectiveness of these long-standing practices adopted by many of the world’s largest and prominent corporations. Due to the digital transformation, many worldwide companies are motivated to offshore their software development needs. 

Below you can read why offshore development companies have become an essential part of the global economy.

How Can Offshore Software Development Help Your Business?

In accordance with this article from Skelia there are many reasons why software companies hire offshore developers, considering the speed at which the digital industry is expanding. 

Companies that want to stand ahead of their competitors need to assign lots of time, effort, and capital to develop innovative and creative software solutions. In this framework, businesses that are unable to hire the most talented recruits may not achieve their goals efficiently.

Therefore, by hiring offshore developers, these companies free themselves from the obstacle of finding first-class staff while they receive the best software solutions with predefined rates and terms.

Below you can find some of the reasons offshore software development can help your business:

Outsourcing Is More Cost-Effective

By hiring offshore developers, you can prevent your business from running out of money. You will not have to spend on additional expenses such as office rent, salaries, insurance payments, vacations, and many others. 

By hiring a trustful offshore developer with the best offshore software development rates, you will be routing funds into your business’s most crucial areas, developing your projects. 

Offers Flexibility

Flexibility is critical when you scale your team or change the technology stack to match the project’s size. Outsourcing developers are more flexible and can easily switch their focus from one task to another.

Delivers Advanced Skill

Many developers worldwide are working for well-known tech giants such as  Apple, Microsoft, DELL, IBM, and others. IT outsourcing provides you with broad access to a great talent pool with the right skills. 

Nearshore software development in LATAM countries can be very fruitful due to the qualified professionals who will be happy to participate in your startup’s development.

Guarantees Quality

When it comes to the quality of the code created by a dedicated development team, one important thing to keep in mind is that a project’s success and quality don’t depend on the country in which it is released. Instead, it depends on the people who built it and how passionate they were about their business.

What Is the Difference Between Nearshore, Offshore, and Onshore Software Development?

Choosing an IT outsourcing services vendor can be difficult, particularly when you don’t have experience with outsourcing. The first point you need to take is deciding where you will look for a software development outsourcing partner. 

Although you will be looking for the best offshore software development rates, you need to pay attention to the three primary options for outsourcing:

nearshore, offshore and onshore. Bellow, you have detailed the main differences between these options: 

Nearshore Software Development

Nearshore software development may be the most convenient option, and it is when you outsource to developers from countries located near similar time zones. 

Your business can get the best offshore software development rates by nearshoring software development. 

Typically, customers count on geographic proximity and cultural similarities. For instance, a nearshore software development location for the United States would be a LATAM country.

Offshore Software Development

With its option, the service provider’s company is located in a different country found in a different continent with a notable time zone difference. 

For instance, an offshore location for the United States would be India. The negative side of Offshore outsourcing is the lack of proximity and cultural similarities that can make the treatment between your team and the Offshore developer’s team complex.

Onshore Software Development

Onshore outsourcing is when you outsource to developers within your country. Some companies find this option convenient. 

Taking into account that the main reason for outsourcing is to reduce your business’ costs, the negative side of this option is that it can be more expensive than the other options on the list.

Offshore Software Development Rates

As we analyzed above, there are three significant options where you can find a software development outsourcing partner. This decision is crucial and needs to be taken comparing the best offshore software development rates and the quality of the partner.

Thanks to modern technologies, your business can save costs by outsourcing software development to an overseas programmer team, according to this article from youteam.io

Outsourcing methods as nearshoring and offshoring can allow your company to contact a vast global talent pool. The average cost of software development services differs from country to country, and development costs may change depending on the platform you use to hire offshore developers.

Offshore Software Development Hourly Rates by Region in 2021

Let now see an overview of regions and software development rates by areas with the different outsourcing methods that we have seen above. It will help your business make a more informed decision when hiring from overseas.

Nearshore Software Development Rates in Latin America

According to IDC, the Latin American IT industry will be growing in 2021 despite political uncertainty and low economic growth. As predicted by Ricardo Villate, vice president of the consultancy for the region, the IT market reached 4.8% in 2020. IDC reports an increase in business spending on technologies related to AR/VR, AI, IoT, 3D printing, cloud, security, and robotics. 

Uruguay, Argentina, and Brazil are the leading software outsourcing country in Latin America and South America. Over the last 15 years, Uruguay has become a first-class business hub and is chosen by foreign companies to develop their IT products or services.

Uruguay is a country of 3.5 million with an IT services machine that continues to perfect the global export model’s execution. Today, foreign companies come to this country to develop their IT products or services to expand their regional operations. 

Uruguay has remarkable technological advances, which place it at the forefront of technology in the region and the world, the highly qualified talent, and its quality of life. This country is a technological hub with outstanding connectivity and internet penetration. 

Ninety percent of Uruguayan homes have access to fiber optics, which guarantees fast download speeds, and 100% of public schools have Internet access.

Argentina is ranked 14th among the best software outsourcing countries and is number 2 in the region. It is also the world’s 10th digital nation in the Tholons Services Globalization Index 2019.

When it comes to offshore software development rates, the average hourly rate for software developer talent in Latin American countries is 45.00 dollars per hour.

Offshore Software Development Rates in Eastern Europe

Eastern European countries such as Ukraine, Belarus, Poland, and Romania are now among the top 5 global software development centers, according to a report issued by AVentures Capital, Aventis Capital, and Capital Times at the beginning of 2019.

The average hourly rate for software developer talent in these Eastern European countries is 33.00 dollars per hour.   

Offshore Software Development Rates in Asia

Asia boasts the most significant number of offshore software developers as compared with other regions. In 2018, only in India, this number amounted to almost 3 million. China is also an attractive offshore development destination. Chinese developers are the first across all HackerRank challenges. 

The Chinese government supports the tech sector by offering economic incentives. For example, now, there are more than 50 science and technology industry parks across the country. 

The average hourly rate for software developer talent in Asian countries is 26.00 dollars per hour.

Advantages of  Nearshore Software Development in Latin America

You need to look for reliable partners with whom you can achieve long-term relationships. Therefore, it is essential to know why Latin America is an excellent nearshore software development destination, according to this article from perficient.com

Great Value and Cultural Similarities

Prices in Latin American are commonly higher than in places like China or India, but the benefits far exceed total costs. It’s not enough for companies to focus on the cost benefits. 

The end costs might be very similar when you factor that you’ll be spending more time trying to connect with your vendor in Asia than in Latin America.

Little Time Difference

As  Latin America is so close to the United States, the time difference is minimal compared to India or China. It means that your business will have nearly an entire workday of overlap with your nearshore software development team.

The number of issues that originate from time differences cannot be discounted. It can often lead to massive delays, which can significantly increase the project’s cost, especially if it’s a vital component of a larger project.

Accessibility

Building a solid relationship with your team is the key to success in any IT outsourcing endeavor. The great proximity means that it’s easier and cheaper to get there.

Being able to hop on a flight, visit your team, and return within a few days is invaluable, and you can do it with far greater frequency than if you were outsourcing to Asia.

Cultural Similarities

It is another excellent advantage of proximity. Latin American culture similarities with the U.S. make intercultural interaction to goes much smoother. Latin Americans will have no problem suggesting more effective alternatives when they can’t do something. 

In Asia, in contrast, the attitude of saying no or contradicting your client is considered a lack of respect. And although it was for the client’s benefit, it is something they simply don’t do. 

As miscommunications and delays are reduced over the long term, the cultural similarities between Latin American and the U.S. can eventually lead to far more significant advantages.

Creativity

Creativity is essential in your business to generate innovation and to remain competitive. It isn’t easy to innovate when working with an IT outsourcing team that will never develop new ideas or more efficient ways of doing things because it’s not how they’ve been brought up to think.

Latin Americans will always tell you if there’s a more efficient way of doing something or if your idea isn’t quite as great as you believe it to be. Latin America is a great creativity hub. Combined with their lack of timidity in expressing themselves, people from this area of the world are great partners for any company that wants to innovate.

This creativity is also great when it comes to problem-solving. An Asian team will wait for clear instructions on how to solve an issue, even a minor one. A team from Latin America will at least try to find a way to solve the problem.

Investing in the Future

Many Latin American governments have realized that the IT industry can provide them with significant growth independent of poor infrastructure issues. 

With software development, all a partner company needs is a minimal infrastructure focused on the quality of computers and internet connections. Due to this, many Latin American countries have been investing heavily in IT, especially in tech workers’ education and training.

To end this article, we want to desire you good luck in your future projects. Now you know the cost-savings benefits when offshoring software development and that a nearshore partner from LATAM can be the best option for your software development business.

About ZirconTech: A trusted partner that helps organizations thrive in their digital transformations. Mobility, Internet of things, artificial intelligence, big data, cloud computing and blockchain technologies.

nearshore, software development software development south america, software development latin america

Offshore software development services emerged for businesses looking to reduce operational costs while having access to a global talent pool. Recently, the US tech job market has been saturated, which resulted in companies looking for more options.

If you want to get ahead of the crowded offshoring market, check out this in-depth guide on offshore software development. Learn why it has been considered reliable and profitable among CEOs and stakeholders.

What is Offshore Software Development?

Offshore software development refers to the digital product development process’s delegation to the developers or a company that offers that service outside the country. Developers from outside the US usually offer relatively cheaper services compared with hiring locals. Companies in the US find it more affordable as they don’t need to cover financial incentives and tax holidays.

Apart from the low operating costs, they get to take advantage of a diverse talent pool. It offers a less taxing way to scale up quickly and improve their technical expertise.

Simply put, businesses get to expand their operations with a diverse team of skilled developers who are geographically distant from the existing employees.

Benefits of Offshore Software Development

There are many benefits to offshoring your software development team. Here are some of them:

Lower Operating Cost

Positions in tech around the world are one of the most in-demand and highly paid workforces today. However, there has been a significant disparity in the rates between US developers and abroad. The average hourly rate of an entry-level developer in the US ranges from $75 to $125. In contrast, skilled developers from Latin America, for example, charge an hourly rate worth $30 to $50. Their wages are significantly higher, not to mention the financial incentives and tax holidays in payroll. When the required wages for US developers account for a considerable portion of your company’s operational costs, it is only practical to opt for offshore services.

Hiring offshore developers let businesses increase their margins without compromising operational costs and the operation itself.

Access to Diverse Talent Pool

Working with offshore development vendors streamlines the recruitment process while giving you access to a global talent pool. As it’s the core of their business, offshore vendors have more experience with hiring seasoned talents. They usually utilize well-established processes to help you fulfill your vacancies within your preferred time frame. With their connections to a network of software developers worldwide, there is less competition for acquiring skilled professionals.

Although their skills are in-demand in the global job market, there is an influx of talent everywhere. For instance, Uruguay contains over 700 tech companies in the IT sector. Uruguay’s massive growth in tech companies stems from their exemption from income tax for any earnings for exporting or outsourced IT services and development. This also keeps costs low without sacrificing the quality of work when outsourcing to Uruguay. On top of their low costs, Uruguay ranks third in English speaking skills throughout all of Latin America. Ultimately, hiring offshore developers eliminates the issue of delay in onboarding your offshore team.

Focus on Core Business Goals

Forming an offshore software development team lets businesses focus on their primary business goals. Companies can concentrate on their critical operations and let the in-house developers concentrate on other significant tasks.

Perhaps it is the perfect opportunity to expand your product and make improvements without overworking your internal team. A team of seasoned offshore developers can manage the work’s development process or configure its add-on services. For instance, they can help you craft a version of your product that addresses a new market at a low cost. Having them perform the advancements for existing products is generally more accessible as it only requires the existing product documentation. This way, there are lesser risks involved, and you can always halt the project when it fails. Otherwise, you can entrust them with larger projects and more complicated tasks.

Timezone and distance will never be an issue if you provide constant communication. Consistently communicate to stay updated about the processes. It is also vital that you articulate the project in detail to prevent misunderstandings and conflict.

Augmenting Offshore Developers with Your In-House Software Development Team

Offshore software development services are especially helpful for businesses that don’t specialize in tech and small to medium-sized tech companies who need on-demand talent based on their project needs. Most tech-focused companies like Google augment offshore developers with their existing team to strengthen their workforce. Whether they have plans for new software or improve versions of their current products, hiring offshore expands technical expertise. It helps them broaden their horizons with specific practices that their internal team might lack.

Communication-barriers might be one of the reasons why many companies are hesitant in hiring offshore developers. It is since collaboration across teams is integral throughout the product definition and development phases. With proper management, offshore developers can contribute to either coding or quality assurance to improve its pace. Given that QA engineers are understaffed in many software development organizations, you can use the extra hand. Offshore QA team doesn’t need to divulge the source code, eliminating the security and risks of compromising your intellectual property. Additionally, outsourcing to countries like Uruguay and Argentina minimize communication barriers since their time-zones align with the United States’ time zones.

Moreover, augmenting offshore developers allows you to streamline significant developments. You can take advantage of a team that is multiple time zones ahead to accomplish round-the-clock software updates.

Finding the Best Offshore Development Company Partners

Before you hire a team of offshore software developers, here are some factors you need to consider:

Prioritize Quality Over Quantity/Costs

Most businesses opt for offshore developers to acquire cheaper services. Given that most of these developers charge less, it is imperative to look for those offering great value.

When the prices are too low, it might be too good to be true. There is always a catch for these circumstances, so it’s vital to screen your hires efficiently. Ask for their credentials, portfolio, and experiences. No one would want to waste your time and money on an underqualified software development team, so choose them wisely.

Are They Reliable?

As mentioned, they should be able to provide a verifiable track record of their previous projects. You have to ensure that the team you are hiring is worth it.

Is Their Time Zone Going to be an Issue?

Most offshore developers adjust their time zone according to the preferences of their clients. It is vital to discuss office hours with your offshore development team before the project.

This communication ensures that their office hours can overlap with your head office.

English Proficiency

To prevent further communication-barriers, it makes more sense to hire a team that speaks your language. It promotes productivity and facilitates cooperation across your internal team at your head office.

Where Can You Find Offshore Software Developers?

Eastern Europe

Eastern European countries are rich with almost 1 million professional software developers. Countries such as Ukraine, Belarus, and Poland are leading resource hubs for skilled developers. A majority of offshore developers in Eastern Europe are well-versed in numerous programming languages.

Ukrainian software engineers are proficient at Java, JavaScript, and Python. A majority of Polish developers utilize PHP as their primary programming language, along with Java and .NET.

Depending on the required skills, experiences, and project complexity, European offshore developers’ average hourly rate goes around $25 to $40. These rates are consistent, compared with the average rates of professional engineers in North America and Europe. However, you would probably find developers with the same competencies in other regions like Asia that charge cheaper.

Asia

Throughout the Asian region, India produces the most number of professional software engineers. This influx of talent is the primary reason many tech giants like Oracle, IBM, and Amazon expanded their business in Bangalore, India. There have been millions of software engineers who graduate in the country annually. With this influx of talent pool, businesses also benefit from lower service costs. The average hourly rate for an entry-level software developer ranges between $18 and $25.

The low prices can come with a significant disadvantage. More often than not, project quality tends to be lower. Businesses must screen their hire carefully to weed out the underqualified applicants. India is followed by China, although their average hourly rates are generally higher. You can acquire an offshore developer by spending around $30 to $40 per hour.

Latin America

Latin American countries have also emerged within the offshore software development industry. Many businesses began taking notice of offshore developers in Argentina, Uruguay, Mexico, and Brazil. Minimal time zone differences and cultural proximity are making it easier to partner with these offshoring destinations. An entry-level offshore developer’s average hourly rate in Latin America reaches around $30 to $50 because the quality is higher.

How CEOs Manage an Offshore Software Development Team

Once you have formed an offshore software development team, it is essential to know the role they play in your business. Depending on whether the team will handle software upgrades, an extension of your products, or help you launch a new product, you must manage them accordingly. As a stakeholder of the company, you must take action to manage your offshore software development team. Here are a few things you need to consider to lead a distant group successfully.

Impart Your Vision

Before anything else, the key to a successful partnership involves a shared vision. You must take time to impart to the team your business goals and mission. Sharing your vision helps them understand your perspective, needs, and plans as a business. It is also an ideal opportunity to get to know them and explore what they can contribute to your business’s future.

More often than not, companies only view offshore teams as an extension of the business rather than a dedicated member of the team. However, this is discouraging and disrespectful due to the significant contribution to your product’s development. Simply put, they play an essential role in its success and progress. Thus, the key is to establish a connection with your team, regardless if they are geographically distant from you. The more they know about your brand, the more they can determine ways to improve their work process.

Right from the moment you start building your offshore team, communicate your vision to let them your brand’s purpose.

Managing Cultural Differences

There are many cultural differences, especially if you are working with offshore developers located in farther regions. They might have different beliefs and aspirations, but you must overcome these differences. Instead of seeing it as a hindrance, make an effort to foster a unified culture of belonging through recognition and appreciation.

Be open with these differences and remind your teams to work towards a common goal. The primary focus should be on the success of the project. It should not matter where they are from nor what they believe.

As the head of the business, it is your responsibility to keep your offshore developers recognized. Ensure polite communication across teams and no one in the group feels excluded. You can break the ice by facilitating welcome conferences. It is an opportunity for teams to get to know and learn more about each other. When teams communicate well, collaboration would not be a hassle.

Communicate Effectively

The key to a successful collaboration with software development teams located offshore is through consistent communication. You must prioritize effective communication across teams above anything else. When teams can reach out to one another without a fuss, they can be more productive. There is nothing that can derail your software development project.

Here are the most common communication channels that you can use between your in-house and virtual teams:

  • E-mails

Email serves as the primary channel of communication for most businesses. It is more formal, typically for tailoring schedules, project details, and project meeting notes.

  • Instant messaging

Instant messaging facilitates consistent communication across the team regardless of their location. For quick clarifications and immediate concerns, you can use Slack, Skype, GoToMeeting, Zoom, Google Drive, Slack, Gmail Suite, and Jira.

  • Productivity tools

Project management is crucial when working with offshore teams to monitor their workflow and processes. Tools like JIRA, Asana, and Basecamp allow you to track their progress easily.

About ZirconTech: A trusted partner that helps organizations thrive in their digital transformations. Mobility, Internet of things, artificial intelligence, big data, cloud computing and blockchain technologies.

nearshore software development South America

IT sector is spreading its root at a rapid pace, and it has brought a lot of innovation in the world and become far more than a platform for the business to run on. IT has now become an essential driver for business growth anywhere in the world.io funcione. La TI se ha convertido ahora en un motor esencial para el crecimiento empresarial en cualquier parte del mundo.

IT software development and outsourcing market are also growing at an extensive rate as an increasing number of companies and industries are turning towards software development to reach or access the market quickly and efficiently and create advanced solutions for the problems and provide customer services to the world full of innovation.

Why Nearshore Software Development In South America?

South America region has grown so much and so fast in the IT sector. Uruguay is one of the Top leading nearshore software developers in South America and according to the Ministry of Education and Culture 2012 UDELAR census, it was mentioned that 75% of its university students are able to read the English language whereas about 55% of the students can speak it.

The people from Uruguay, Argentina and other others from South America are more aware and socialized with the world. They know about facts and figures and proper use of online services and facilities. This is because the literacy rate is high because of universal public degree courses that are offered to the citizens. Uruguay also became the first country in the world to provide a free laptop to all public school students and teachers. This means the youngest generation is the most tech-savvy that South America has ever seen.

YOU CAN BE INTERESTED IN THESE ARTICLES TOO:
1. Cost-Savings Benefits when Offshoring software development
2. How Offshore Software Development can help your company growth
3. Offshoring software development in South America
4. Pros and Cons of Offshore Software Development every CEO needs to know

The top countries to hire a software developer in South America are:

·     Uruguay

·       Argentina

·       Puerto Rico

·       Colombia

·       Brazil

·       Peru

These nations have shown the steadiest development and the most alluring financial environment to stand out enough to be noticed of worldwide organizations from everywhere the world. This makes Nearshore Software Development in South America very important. 

If you want to to learn more about the benefits of offshoring don’t miss our last guide made for CEOs: The Ultimate Offshore Software Development Guide 

Why Nearshore Outsourcing Became Popular in the Last Decade

Nearshore Outsourcing implies that you give programming and software development or certain errands to organizations situated in the geological vicinity of your country. At the point when you employ a nearshore organization, the distinction among you and the project worker ought to be from 1 to 3 hours. This reduces time and communication barriers.

Outsourcing turned into a necessary chore by furnishing organizations with adaptable alternatives. Explicit assignments could be moved to IT teams without the overhead expenses related with recently added team members.

To keep a competitive edge, organizations need the information that lone ability with a significant degree of expertise can give. Outsourcing helps these particular specialists to be contracted at lower costs for software development work.

Nearshore Software Development in South America and Outsourcing

South America has its roots deep wide in the business and IT sectors, due to which nearshore software development in South America is a major hit for this country. IT outsourcing in this country became more prominent over the past few years. Outsourcing is helping in growing software development more with cost reduction resulting in giving major benefits to the nearshore businesses.

In the current era of innovation and trade, a lot of US-based organizations and businesses are turning to South America for outsourcing as it has good nearshore software for higher quality and good time zone.

Advantages of Outsourcing to South America

As should be clear, there is a great potential for nearshore software development in South America and outsourcing, and it can be an exit plan for various organizations. Here are a few benefits and advantages that companies have when they outsource in a continent like South America.

·   Cost-effectiveness

·   Talented and dedicated workers

·   A productive environment for Business

·   Cultural similarities

Nearshore vs. Offshore outsourcing

Nearshore outsourcing involves the geographical proximity along with the similarity of time zones for the countries. Considering the example of South America, it can work as nearshore to grow business at a rapid pace with more cost reduction benefits. But if we consider the example of Asia, then it becomes offshore outsourcing due to differences of distance and time zone.

Price is the main thing to consider when you are selecting between nearshore or offshore concept. There is a high price for the nearshore services as compared to offshore services, but the advantage is that you can expect these nearshore software development in South America prices to be much lower, about 2 to 3 times less than in the US.

We have made a list of the following points that will help you to consider a lot of things while choosing to go for offshore or nearshore outsourcing.

Location

The nearshore software development approach basically relies upon the location for outsourcing. While choosing any organization that is outsourcing, you should be aware about all the number of specialists which are qualified in the country.

When you are deciding to choose between offshore or nearshore, then you must know that the location is a very important factor for your outsourcing company to perform well for benefit.

Cost-Effectiveness

Organizations are using outsourcing strategies to cut costs. What’s more, you don’t need to enlist designers, pay rents or wages, or provide facilities to the members or workers. Because of the way that normal outsourcings nations are progressing well, the valuing can be fundamentally lower than in developed nations.

Closer Collaboration

Another benefit of participation with a nearshore software development in a South American organization is a brief distance between both the developer and the organization. With the improvement of innovations, the world’s decreasing and you can take care of the vast majority of the issues by means of telephone.

However, once in a while, your actual presence might be required, so there could be no other choice except for going to your partner to have a meeting.

Less Demands on the In-House Team

Organizations chose to move to South America in light of the fact that the locale offered a significant number of the components organizations were searching for while outsourcing, like exceptionally skilled developers and more imaginative development strategies.

The political, social, and monetary advancement in countries like Uruguay isn’t simply helpful to the locale; however, it is additionally valuable to the unfamiliar organizations that are outsourcing to address the IT requirements.

Benefits of Working with Nearshore South American Developers

South America is a good record of developers that can perform well to outsource and are still eager to do better work for nearshore businesses. There are several benefits that organizations get.

Experienced Talents in No Time

This benefit can be applied to any outsourcing type, but the fact of the matter is you don’t need to go through weeks searching for qualified and skilled talents among the entirety of their CVs. These activities expect you to have an HR division.

The nearshore software development in South America team has developers who have been working on many projects recently, which makes it easier and more effective as the team members don’t have any communication gap after this, and they also have some experience gained in this regard.

In case that you need more developers for the improvement of extra highlights, nearshore software development in South America gives out more talented experience as you scale.

Price and Quality

When working with nearshore software development in South America, you don’t need to stress over reducing the quality and nature of work at lower costs. South American governments put resources into specialized instruction, which considered the foundation for abilities and talents to thrive.

While transformation rates from the U.S Dollar to any South American cash are good, the genuine advantage comes from the enthusiasm that South American engineers have for their work and their energy to take an interest in the U.S tech market.

International Experience

South America is open for international business, and it draws in numerous worldwide organizations that need to exploit the advantages that remote engineers have to bring to the table. Numerous capable designers have worked with worldwide associations on projects, acquiring novel thoughts and abilities simultaneously.

South America’s cost-effective ways, joined with the business environment and skilled developers, is the reason that nearshore software development in South America is progressing at a rapid pace. The companies are starting to search for outsourcing firms that can help in both offshore and nearshore Software development in South America.

Scaling Flexibility

Having the option to extend and cut back rapidly is an extraordinary upper hand for organizations that are delicate to the change. Employment laws and guidelines may convolute the interaction and put an additional expense to it; outsourcing gives organizations greater adaptability here and an opportunity to work quicker in this sense.

Impact of Time Zones on Cost

Time zones can have great impact on nearshore software development. If you are working for agile software development, then this significantly leaves a greater impact as reduced time difference allows less response time in the work.

This also helps synchronous communication, which makes it easier resolve issues if there are any. This is the reason why South America time zone has a great advantage on nearshore software development by focusing on Agile driven models.  

Distance and Cost

Taking into account that everything happens online these days, you may believe that distance shouldn’t be an issue past the time difference problem. South America emphatically advocates assembling an incredible relationship with the offshore software development team because it is more effective when nearshore software development in South America isn’t growing much.

The nearshore software development in South America is best as you can meet the partner or the person within no time if you need to discuss some matters in real-time. The face-to-face deal is more ideal, and it makes IT outsourcing more secure and easier for the teams that are working on the software development.

High Internet Connectivity

South America has high-speed internet connectivity, and Uruguay is one of the most progressing parts of it. Uruguay residents are now more connected than ever. The high-end internet connectivity is making it easier for organizations to connect and communicate via Google chat or Skype. Uruguay gets benefitted from nearshore software development in South America, and here are some quick facts about it:

·   Uruguay is the #1 for having nearshore software development in South America with fixed broadband internet connectivity. It has the fastest internet download speed.70% of the population of Uruguay owns a computer system.

·   All of the schools and educational institutions within the country have an optical fiber connection.

In case that your research cost only reliant on incomparable figures, your most ideal choice will undoubtedly be Asia as you will consistently get statements only. Taking everything into account, any specialist from another piece of the world will charge you less for the administrations while you will get higher rates inside South America.

In any case, when choosing cost capability, you need to investigate a lot of elements other than the quick expense cost of that project.

Better Intercultural Communication

We know that social and cultural differences can become a huge test to cost and productivity. The proximity and a long history of exchange and collaboration imply that individuals in South American nations comprehend U.S. culture far superior than those from Asia.

This removes the communication barriers, and it is less likely to cause any mistakes or misunderstandings. A group from any country will realize that you anticipate that they should be proactive, though an improvement group or the development group from any other country will anticipate that you should give exact guidelines for each step. If you don’t, then due to a communication gap, they will not go according to your guidelines since they’ll believe that it’s not what you need.

Cultural and Social issues may appear to be little and insignificant from the start. Notwithstanding, when you begin working with a group whose culture is immeasurably not quite the same as your own, and you’re not aware of that distinction, your project can go into a loss.

Language

When you connect the in-house staff with the outsourced teams in South America, this will create a sense of brotherhood and comfort zone, and it leaves an open communication too when they talk on the phone or through messages. The high-level outsourcing companies choose your preferred language to work with and take care of your necessities.

Cost-Reduction

Cost-Reduction is without a doubt an essential role for outsourcing as employing capable specialists in the US, particularly those in fields of software development, is probably going to cost a lot more than the amount in contrast with somebody with a similar range of abilities in South America.

You can take the example of a developer from the US who may work at an hourly pace of USD $100 while a similarly qualified nearshore software developer in South America might be accessible for work and will play out a similar task at a lower price of USD $60 hourly.

Proficient Focus

Not all organizations have the data transfer capacity or experience to deal with a designing group in-house. Outsourcing advancement can give a layer of solace, realizing that their application is being created, permitting supervisors to focus in on things that matter.

Admittance to Assets or Resources

Only one out of every odd organization can afford to include all the essential assets inside the association. Outsourcing assists new organizations with welling set up ones to get to these assets and innovations through mediators and utilize it however long they need it.

Conclusion

This was a detailed discussion on Nearshore software development in South America and all of the advantages and disadvantages. Outsourcing is explained in-depth with its benefits and social effects on the business of different organizations. This was complete detail, and if you have more questions, you can comment in the box given below.

If you want to to learn more about the benefits of offshoring don’t miss our last guide made for CEOs: The Ultimate Offshore Software Development Guide were you will understand the Benefits of Offshore Software Development, it will help you to find the best offshore development company partners and how to manage an offshore software development team 

FAQ’s

What is nearshore outsourcing?

A nearshore is an outsourcing form that refers to the services which are delivered from a nearby location. This concept first arose in 1997 by Softtek. Nearshore software development services emerged for businesses looking to reduce operational costs while having access to a global talent pool. 

What is nearshore software development?

Nearshore software development in South America or outsourcing means that you provide your services of software development or certain tasks to organizations that are located in geographical proximity to your country. The maximum difference of time between you and the hired nearshore company should be between 1 to 3 hours.

What are outsourcing services?

Outsourcing services means the actual practice of passing tasks or business processes for an organization or a third-party and receiving profit from them in return.

Offshoring software development South America

Offshoring software development has been the staple for business from startup, small business, and medium-sized enterprises. Even giant corporations like Google, WhatsApp, Slack, Alibaba, and GitHub offshored their back-end operations from the ground up. There are a variety of reasons behind this decision, but the most one of the most crucial one is to reduce operational costs.

Ever since the offshore software development industry emerged in the tech market, the interest shifted across Asian countries. From India and China to Vietnam, companies in the US availed their services to take advantage of the lower charges.

South America has managed to gradually make its name along with the roster of offshoring destinations. It has recently been preferred by a growing number of businesses when it comes to software development. North American enterprises opt for Latin American developers instead of their in-house teams for projects and several upgrades.

Also on the IT industry’s radar are South American countries such as Mexico, Chile, Argentina, Colombia, Brazil, Uruguay, and Costa Rica. These countries gained a significant role in the software development industry for providing quality work at a low price. Latin Americans’ competitive edge involves real-time collaboration, travel proximity, and cultural similarity, making working relationships easier.

In this article, we shall further discuss the reason behind South America’s popularity for offshoring software development.

 

What Puts South America in the Eye of Offshoring Software Development?

Asian countries, including India and China, have been the leading countries for offshoring developers for a while now. They have contributed to transforming the business landscape, helping establish some of today’s biggest corporations. They provide lower labor costs and a limitless supply of seasoned software developers.

However, South American has begun to catch up. They were given the spotlight with an increasing number of companies that offer projects to Latin American developers.

Let’s take a look at why South America is a favorite of the job market of today.

 

Fewer Problems With Time Zone Alignment and Communication

South America offers convenience with its minimal time zone differences. Both parties don’t need to make significant adjustments to be able to work efficiently. For instance, Uruguay and Argentina are only five hours ahead of California. It is in comparison with China and India that have approximately a 13-hour difference from companies around the US.

Consistent communication is crucial, especially during project development and earlier stages of tasks. When teams can communicate with no interruptions, delegation is efficient. The minimal time zone difference fosters effective communication across the software development team.

Even though both parties are miles apart, you can always guarantee to receive a quick response from your offshore developers. This assurance allows you to detect and resolve any conflict that arises with no delay. On top of that, you can also travel to your offshoring team when necessary. Business travels are more cost-effective even if you come from cities like New York, California, and Seattle.

Get the ultimate offshore software development guide for CEOs. Download my ebook.

English Proficiency

The latest studies have found that Latin Americans surpassed the years of stagnation in English proficiency. South American countries like Peru, Uruguay, Argentina, Ecuador, Chile, Brazil, and Mexico drastically improved and recognized the importance of learning English.

With more people invested in English proficiency, there are more job opportunities for Latin American developers. The growing number of fluent English speakers in the region have provided them with more high-paying jobs and opportunities. For this reason, they have established diverse educational programs and initiatives to encourage more people.

Moreover, one of the drawbacks to offshoring rotates around the cultural differences. Latin America and North America are near each other, so it should not be an issue. They share a long history of trade and interaction in comparison to Asian countries and European regions.

Therefore, misunderstandings are less likely to happen. You can expect an Uruguayan software developer to be more proactive than an Indian developer. They have a better understanding of American culture and work ethic, so they understand what’s at stake. Offshoring Asian developers might expect you to guide them throughout the project instead. They also tend to perform beyond your expectations because they assume it’s not what you want.

What is the Hourly Software Development Rate in South America?

The average hourly rate for a majority of South American countries starts at $45. In the leading offshoring software development destination, Brazil, you can expect developers to charge you around $40/hour. It may cost a little more than what Asian software developers offer, but if you are looking for better coordination, project delegation and quality, the price could be worth it.

About ZirconTech:
A trusted partner that helps organizations thrive in their digital transformations. Mobility, internet of things, artificial intelligence, big data, cloud computing and blockchain technologies.

Pros and Cons of Offshore Software Development

The foundation of every successful business is an adequate workforce. When companies prioritize innovation, growth, and brilliance when forming their team, there are more benefits to it than they realize.

However, building an excellent in-house software development team requires a substantial investment. Hiring software developers internally results in more expenses, including labor cost, renting office space, insurance, furniture, utilities, and so much more. They have to be able to match according to the industry standards, and it’s not cheap.

For small and medium-sized enterprises, software development offshoring is a feasible alternative. They can afford competitive rates without compromising the project quality. To further give you an idea about offshore software development, here are the pros and cons of this business model.

Pros of Offshore Software Development

Knowing the pros of offshore software development can help you decide if this can work for your business.

Reduce Your Development Costs

It is imperative for businesses that have only been starting to reduce their costs as much as possible. Whether you are forming a startup or small enterprise, you have to allocate your budget accordingly. Otherwise, your venture can likely fail.

To focus on the core of our business, it’s best to offshore software development. Hiring software developers outside the US tend to be cheaper than the local market rate. You can find those with the same skill-set and experience to fulfill your business requirements at a lower cost. This option allows you to acquire the best talent without sacrificing the quality of work.

You can utilize the savings to invest in market research, marketing, and performing advancements to improve your products and services’ functionality.

Access to a Diverse Talent Pool

Expanding your horizon allows you to discover a diverse pool of skilled software developers. When you don’t put geographical restrictions to sustain your business, you can explore endless opportunities. You can select a country that has a reputation in tech and find people suitable for your team. For instance, Microsoft and Hewlett-Packard recently started an educational program in Latin America to further develop their skill set in the IT industry. This will lead to a major influx in IT talent throughout Latin America including Argentina and Uruguay.

Ultimately, gaining access to a global talent pool is way cheaper than the latter.

Offers Flexibility

Hiring internally means that you are bound to keep them for the long haul. However, you may find your in-house team struggling to complete piling tasks on the intended timeframe. To strengthen your workforce without spending much, hire offshore developers. You can always halt the contract when you don’t feel like you need them anymore. There’s less commitment involved, and it streamlines the workflow.  Accordingly, you can always opt for offshore developers, especially for short-term and seasonal projects.

Get the ultimate offshore software development guide for CEOs. Download my ebook.

Cons of Offshore Software Development

Despite the numerous advantages of offshore software development, you cannot go down this path without considering its potential disadvantages.

Security Risks

There are security risks involved when offshoring your software development team. Working with them consists of sharing confidential ideas about your project. There can be situations when they potentially steal parts of your concept to earn or establish it as their own. They are geographically distant from you, so making disputes can be complicated. However, you can prevent this in the first place if you have them sign an NDA.

A non-disclosure agreement can protect you if the other party compromises the data you have shared on the duration of the project. It protects your confidential information during the development of the product or software.

Poor Project Quality

Although this only happens occasionally, you cannot always guarantee that they can produce high-quality work. This issue is why you need to communicate to check your offshore worker’s progress and consistently provide valuable feedback.

Often, companies test the offshore team before deciding whether they will take them to finish the rest of the process. It is also an opportunity for you to see their strengths and weaknesses. This testing stage prevents you from wasting your time working with an offshore team that is bound to fail.

Communication-Barrier

Similar to any remote work arrangements, this setting can sometimes result in miscommunications and misunderstandings. More often than not, English is not their first language, so they may not understand some expressions and terms. They might also find it difficult to express themselves better when they struggle with the language.

Moreover, communication-barrier can also arise from time-zone differences. Emergency messages placed outside of the office hours may take a few hours to receive a response, considering they are only just waking up or about to sleep. For requests and approval for actions, it may take until the next day to get their response.

However, most offshoring teams adjust their working hours according to the American market, which allows them to communicate with clients efficiently. These issues are also nearly non-existent when outsourcing to Uruguay and Argentina due to their strong proficiency in English, cultural proximity to the United States, and similar time zones.

 

About ZirconTech:
A trusted partner that helps organizations thrive in their digital transformations. Mobility, internet of things, artificial intelligence, big data, cloud computing and blockchain technologies.

 

The Lowdown on Software Development Offshoring

With the drastic shift in the business landscape in light of COVID-19, small and medium-sized companies have to make extra efforts to remain operational. Every enterprise around the world is trying to survive amidst the devastating effects of the pandemic. This scramble for survival means that they need to pay close attention to their outgoing expenses while maintaining a consistent revenue to stay afloat.

The increasing demand to fulfill software development positions in a digitally-saturated market is certainly not helping. Not to mention the escalating expenses, including labor costs required to sustain an exceptional IT team.

Businesses take the initiative towards offshoring software development teams to address these concerns. From startups, small businesses to medium-sized enterprises, offshoring seems to be the most sensible and cost-effective solution right now.

Offshoring Software Development Transforms The Business Landscape

Offshoring software development transforms the business landscape. It is a huge step, especially for small businesses and the like. Giant corporations have explored this business model long ago and even expanded their offices throughout the offshoring destinations. Ford Motor Company, CISCO, American Express, General Electronics (GE), and Microsoft are only a few of the many enterprises that offshore their back-office operations in other countries like India. Although there might be risks that come with offshoring, it brings several benefits that differentiate the established processes worth it.

Provides Flexibility

Most companies choose to offshore to save time spent on sourcing, recruiting, hiring, training, and onboarding new employees. Offshoring a software development team is much simpler, especially for short-term projects and tasks. If you need developers with a specific skill set that your internal team might not possess, you can access a global talent pool with so much to bring to the table.

Moreover, offshoring software developers means that you get to save the overhead expenses spent on accommodating in-house employees. Offshore developers can access their equipment and software, saving you from training and orienting them on a specific project.

Additionally, businesses can scale their operations. Yet, they like projects that require more workforce and expertise, which they can get from one or two offshore vendors. If you only need a small team to be augmented to your existing employees, they can also make that happen. Software development offshoring gives businesses the flexibility to respond to changes as they occur. It enables them to address issues right away, given offshore developers’ reputation to streamline the time-to-market rate.

Get the ultimate offshore software development guide for CEOs. Download my ebook.

Access to a World-Class Talent Pool

Software development offshoring connects businesses to a world-class talent pool. From full-time, part-time to project-based jobs, you can acquire exceptional developers from all over the world.

Offshore developers mostly work on project-based tasks. Although they are provided with brief targets to hit, these developers take it as an opportunity to demonstrate their skills. Working with diverse companies allows them to gain different perspectives and experiences. This diversity enables them to take initiatives beyond the goal appointed to them.

Distance has never been an issue. There have been countless communication channels and project management tools to keep teams connected throughout the project. When problems arise, teams from the head office are one call away.

Lowers Operational Costs

For businesses looking to reduce their operational costs, software development offshoring can be your best bet. Acquiring a team from outside the country lowers at least 70% of small and medium-sized companies’ operational costs. Common offshoring destinations like India, China, and some countries from Latin America tend to have lower living expenses than the US. For this reason, developers in these countries charge significantly lower.

Finding the Best Offshore Software Development Company

A growing population of companies strives to search for the best offshore software development team. But where should you begin?

Here are ways to help you find the right offshore development company to delegate your crucial tasks to:

Ensure Timely Communications

Timely communications are essential to the success of any project. When working with an offshore development company, you want to ensure they will communicate with you effectively prior to starting a project with them. You can test their communication skills by paying attention to the questions they ask about your project, how quickly they respond to your requests, and their overall professionalism during communications. Additionally, they should staff your project team with a project manager who will maintain consistent communication with you for status updates and all other needs.

Cross-Check Their References

Anytime you hire an offshore development company, always request they provide you with references. How well they handled previous projects can guide you on how well they will handle your project. You can ask for samples of their work to confirm their previous projects were free from bugs and were coded effectively. You can also call their previous clients to discuss their satisfaction with the offshore development company. This gives you an inside look into what you can expect when working with their teams.

About ZirconTech:
A trusted partner that helps organizations thrive in their digital transformations. Mobility, internet of things, artificial intelligence, big data, cloud computing and blockchain technologies.

 

The Ultimate Offshore Software Development Guide for CEOs
Offshore software development services emerged for businesses looking to reduce operational costs while having access to a global talent pool. Recently, the US tech job market has been saturated, which resulted in companies looking for more options.
If you want to get ahead of the crowded offshoring market, check out this guide on offshore software development. Learn why it has been considered reliable and profitable among CEOs and stakeholders.

What will you find in this guide:

What is Offshore Software Development?

Benefits of Offshore Software Development

  • Lower Operating Cost
  • Access to Diverse Talent Pool
  • Focus on Core Business Goals

Augmenting Offshore Developers with Your In-House Software Development Team

Finding the Best Offshore Development Company Partners

  • Prioritize Quality Over Quantity/Costs
  • Are They Reliable?
  • Is Their Time Zone Going to be an Issue?
  • English Proficiency

Where Can You Find Offshore Software Developers?

  • Eastern Europe
  • Asia
  • Latin America

How CEOs Manage an Offshore Software Development Team

  • Impart Your Vision
  • Managing Cultural Differences
  • Communicate Effectively
Get the ultimate offshore software development guide for CEOs. Download my ebook.

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