Strategic Nearshore Outsourcing Model Benefits
What Is Nearshore Outsourcing?
Nearshore IT outsourcing is one of the few business practices that companies of all kinds are extensively using lately for the many benefits it presents. What is it in particular though? In business, outsourcing implies a delegation of certain tasks to an outer contractor in order to gain some cost reduction. Of course, there can be many other reasons to turn to the nearshore outsourcing model, however, cost-cutting still remains to be the most popular one.
Nearshore IT Outsourcing Benefits
Being a part of outsourcing in general, nearshore outsource practices require the forementioned task delegation to companies located in the countries nearby. For example, for European countries, a great place for nearshore outsource can be Poland or Ukraine.
Typically, a nearshore outsourcing model provides plenty of benefits for the business:
- Lower costs. IT nearshore outsourcing practices can significantly reduce your expenses due to the rates’ difference. Sometimes even in the closest-located countries, the difference in rates of particular developers can be 2 or even 3 times lower.
- Big talent pool. With near shore outsourcing you are no longer limited with your search by your country’s borders and can extend your search to countries nearby, therefore increasing your chances of finding the perfect specialist.
- No cultural differences. Different cultures can often disrupt business relations as they imply differences in leading business communication and work ethic in general. Hiring a team of nearshore developers can ensure that your communication over the project will be clear and the result will look like you expect it to.
- Easier traveling. With the nearshore outsourcing model, a team is usually located no longer than 1 or 2 time zones away from the client so it will be really easy to travel to them. Even if you are not planning on paying lots of visits, just one trip to meet your potential workers will not take long.
- No language barriers. Nearshore outsource usually implies that your team speaks the same language as you. Now when it comes down to the IT industry, and programming, in particular, being able to have a clear communication is the key to great results and the overall success of the project.
As you see, there is more than just one benefit of the nearshore development outsourcing model so chances are high it might be a wise decision to consider using it for your business.
Nearshore Outsource Employment and Management Practices
However, these are not the only industries, suitable for nearshoring practices. When it comes down to the nearshore vs outsourcing, it becomes clear, that almost every company these days turns to it. Industries that rely on product manufacturing, such as, for example, electronic goods manufacturers, often outsource to other countries to get cheaper details in terms of production expenses. Mainly, such situations happen to American companies where the price of production is very high. That is why US companies often look for ways to decrease those numbers and compare nearshore vs outsource practices. While it could be economically more beneficial to outsource to some far away located countries, sometimes nearshoring is a far better choice to make.
Employing nearshore specialists requires doing a little research first to be able to find really good ones. First of all, never neglect an opportunity to personally go and visit the office of your potential team. Getting to know them in person and seeing their office premises might actually give you the idea of their attitude towards their craft. While you are there, ask them to show you a portfolio of their best works – seeing your potential team in action is also important before you sign any kind of contract with them. Finally, do not forget about management issues. Even though the nearshore team will be located not that far away, managing them may be easier if you know how to handle offshore team. The distance might become an issue unless you approach it smartly.
So how do you manage a nearshore team of developers? Try to follow these rules:
- Make sure they clearly understand your vision of the project. This way you will not have to micromanage every step of the process.
- Assign the team with a manager. There should be one person responsible for the team’s management who will respond directly to you.
- Overlap the hours. Make sure you have at least a few hours per day that will overlap with your team’s working time so that you can discuss some issues in real-time.
- Use video calls. Messaging is a great way of keeping yourself updated about your team’s productivity and performance, however, having regular video calls is an even better choice. Just make sure you provide your team with all the necessary tools for it like fast connection and specialized software. Also, hold such conversations on a regular basis.
Nearshore vs Offshore Development Models Comparison
To achieve a positive result, it is necessary to understand the variety of outsourcing models. Among such we can outline nearshore vs offshore outsourcing for use in software development. Attracting talent from outside opens up new paths of innovation and takes a product to a level that an internal team alone would not achieve. Considering the idea of transferring some functions of the enterprise to third-party companies, management quite often comes across offers to turn to nearshore vs offshore outsourcing.
Offshore IT outsourcing involves the use of third-party services located at large distances from the customer’s location. IT nearshore outsourcing involves contacting more geographically approximate nearshore web development teams when the difference in time zones does not exceed 1-2 hours. The presence of the customer is mostly required when resolving some issues. If we talk about working in the format of offshore IT outsourcing, it will take a very long time to get to the developers, and such a trip can significantly affect the budget of the company. We will explain below which of these two options are the most attractive for a client.
What Makes Mobilunity a Reliable Nearshore IT Vendor
It is worth paying attention to factors affecting the success of an ongoing project given to nearshore IT vendor. Understanding these preferences will help you make the right choice when deciding between nearshore vs offshore outsourcing:
- Availability of the development team. For continuous monitoring of their activities IT nearshore outsourcing benefits from the ability of a client to spend minimal time on the road to outsourcing company. This makes IT nearshore outsourcing popular in Europe.
- Price/quality ratio. If a commercial enterprise in need of software development faces a high cost of services from nearby performers, then preference will be given to more affordable alternatives like nearshoring & nearshore outsourcing services.
- Convenient time zone. An important factor is the mechanism of interaction between a client and a developer when a large difference in time zones can negatively affect the final result. In this regard, when choosing between nearshore vs offshore IT outsourcing, the company will prefer to focus on the first option, since a slight time difference will not affect the interaction format.
- Transparent communication. If the negotiation between the customer and developer is organized correctly, both parties will be able to coordinate action plans and develop technological products in a quality and timely manner.
We at Mobilunity are building the whole nearshore development outsourcing process in accordance with the above-mentioned principles.