Offshore software development is a common and efficient method of transferring software projects to a third-party vendor in a different country or continent. The primary rationale for outsourcing software development is to minimize costs, gain access to a bigger and more diversified labor pool, and shorten time-to-market. According to Grand View Research, the global IT outsourcing industry is estimated to reach $937.6 billion by 2027, growing at a 7.7% CAGR from 2020 to 2027. Within this vast market, offshore software development plays a critical role in meeting organizations' increasing demand for dependable and cost-effective software solutions.
However, to make sure offshore software development turns out to be a successful business decision, there are many aspects to be considered. The list includes things like service quality, communication and collaboration issues, cultural and legal variances, and data security and privacy concerns. This blog aims to provide a comprehensive strategy guide for achieving success in offshore software development in 2023. The discussion will span critical facets such as the types of services applicable to offshore development, the complexities of the offshore software development process, essential preparations, encountered challenges, variances in costs, the rationale behind choosing offshore development, and concluding insights.
What services can be offshored?
Offshore software development is not restricted to a single service or technology. Any software development project that can be completed remotely can be offshored, as long as you have a clear and precise specification of your requirements and expectations. Let's look at some of the most common services that are offshored.
Mobile development is the process of generating, designing, and managing mobile applications for various platforms and devices, such as iOS, Android, and Windows. Swift, Objective-C, Java, Kotlin, Flutter, React Native, Ionic, Xamarin, and other platforms are built for mobile development. Offshoring mobile development can help you access a wider and more varied audience while also using the latest mobile industry trends and developments.
UI/UX design is the process of generating, designing, and refining a software product's user interface and user experience. Wireframes, mockups, prototypes, user research, user testing, and other tools and approaches can be used in UI/UX design. Offshoring UI/UX design can assist you in improving the usability, functionality, and aesthetics of your website software product, as well as increasing user satisfaction and retention.
QA and Testing
Assurance of software product quality, performance, and functionality is achieved through the process of quality assurance (QA) and testing. Manual testing, automated testing, unit testing, integration testing, regression testing, functional testing, performance testing, security testing, and other techniques and tools may be used in QA and testing. Offshoring QA and testing can assist you in ensuring the dependability, stability, and security of your software product, as well as identifying and correcting any problems or faults prior to its launch or deployment.
The process of giving support, advice, and guidance to customers or users of a software product is known as customer service. Customer service can be provided through a variety of channels and platforms, including phone, email, chat, and social media. Offshoring customer service can assist you in increasing customer satisfaction and loyalty, as well as handling customer problems and complaints more efficiently and effectively.
E-commerce and CMS Platforms
These software packages enable the design, management, and operation of online storefronts and content-based websites. E-commerce and CMS platforms require expertise in frameworks like Shopify, Magento, Umbraco, WordPress, and others. Offshoring e-commerce and CMS platforms can support your company in more effectively and economically launching and running your online business, as well as customizing and optimizing it to your needs and preferences.
Related: Read our blog on Umbraco.
Cybersecurity services are software solutions that secure a software product's data, systems, and networks from illegal access and damage. These services involve various methodologies, from encryption to antivirus and VPNs. Offshoring cybersecurity services is a good way to protect your software product from cyber dangers and risks while also complying with applicable laws and regulations.
Offshore Software Development Process
With some slight modifications depending on the project and vendor, the offshore software development approach follows basically the same path as the onshore or nearshore outsourcing process.
Gathering and analyzing the requirements
This is the first and most significant step in the offshore software development process, in which you establish and document your software project's needs, goals, expectations, and timetable. You should also do market research and a feasibility study to validate the idea and scope of your software project. This stage will assist you and your offshore software development vendor in developing a shared understanding of the software project and its deliverables.
The architecture and structure of your software project are designed by your offshore software development vendor based on the requirements and specifications you provided in the first step. This stage is integral for you and your offshore software development vendor in developing a shared understanding of the software project and its components.
Coding and implementation
The third stage of the offshore software development process involves your offshore software development vendor coding and implementing your software project. This should also be done based on the architecture and design you authorize.
Security and quality assurance
At this stage, your offshore software development vendor verifies the security and quality of your software project in accordance with the standards and criteria you agreed upon initially. This stage is of utmost importance as it provides a shared assurance of the software project's performance.
A rather self-explonatory step, deployment involves your offshore software development vendor deploying your software product to the target platform or environment.
Usually the last step in the offshore software development process is post-release maintenance. This is when your offshore software development vendor provides you with continuous support and maintenance for your software project in accordance with the terms and conditions that have been previously reached.
5 Tips for Offshore Software Development
There are several things you should plan for before beginning your offshore software development project to ensure a smooth and effective collaboration with your offshore software development vendor. Let's look at some measures you should take.
1. Understand your requirements.
You should have a clear and complete grasp of the requirements for your software project, such as the purpose, scope, features, functionality, design, quality, security, and so on. You should also have a realistic and flexible budget and timeframe for your software project, as well as a backup plan for any adjustments or concerns that may arise.
2. Define goals and expectations.
Your software project goals and expectations, such as objectives, outcomes, deliverables, milestones, and so on, should be clearly defined and quantified. This should be followed by a clear and effective communication and feedback process with your offshore software development vendor. A frequent and transparent reporting and monitoring system should also be in place.
3. Keep up with current trends.
Keep up-to-date on current trends and how things are handled in the service you require. You should have a thorough understanding of current trends and best practices in the software business, as well as the specific service or technology needed for your software project. Your tech savvyness will come in handy when controlling your offshore software development project and its delivery. Go the extra mile and grasp how things are done in the area or region where your offshore software development vendor is based, such as the culture, language, time zone, work ethic, and so on.
4. Conduct a thorough background check.
One of the most important rules in business is that you should be able to trust your partners. Since there's a sea of potential vendors to choose from, make sure you approach the process holistically. You should conduct a thorough examination of your possible offshore software development providers' reputation, portfolio, experience, expertise, talents, quality, security—and the list goes on! Shortlist candidates and then conduct a clear and fair comparison and evaluation between them to make sure that you go for the right fit.
5. Take care of the legal side of things.
Ensure that you carefully review and negotiate the terms and conditions of any contracts or agreements with your chosen offshore software development provider. It is important to have a clear understanding of the legal obligations and protections for both parties involved. You also need to conform to the laws and regulations of both your country and the country where your offshore software development vendor is based, such as tax laws, labor laws, trade laws, and so on. So, do not underestimate the importance of this step!
Challenges of Offshore Software Development
Offshore software development is not without risk or difficulty. Let's look at some of its main challenges.
The time difference between you and your offshore software development vendor is one of the most common things that might cause issues if not managed properly. In and of itself, offshore development means that the time difference can range from a few hours to an entire day. This can cause issues with your software project's communication, cooperation, coordination, and delivery. To address this difficulty, create a clear and consistent communication and feedback plan, as well as use effective tools and platforms for online collaboration and project management.
Another common and subtle offshore software development difficulty is the culture mismatch between you and your offshore software development vendor. Language, values, beliefs, traditions, customs, etiquette, and other cultural differences may exist depending on the area or region in which your offshore software development vendor is based. This can lead to issues with your software project's understanding, trust, respect, and rapport. This is completely manageable, though, as long as you learn and appreciate your offshore software development vendor's cultural heritage and diversity, as well as communicate and interact with them in a professional and respectful manner.
Lack of involvement
Entrusting your project to an offshore software development vendor means giving up some sort of transparency and involvement in its delivery. Depending on the quality and dependability of your offshore software development provider, a lack of involvement might result in a variety of challenges, including hidden charges, delayed delivery, poor quality, scope creep, and so on. It could be the root of other issues with your software project's satisfaction, accountability, and control. To solve this difficulty, you should select a reliable and trustworthy offshore software development vendor, as well as periodically and completely monitor and analyze their progress and performance.
Data security risks
Data-leaking hazards between you and your offshore software development vendor are an uncommon but essential worry in offshore software development. The concerns can include a variety of threats, such as hacking, phishing, malware, espionage, and so on. This can lead to issues with your software project's confidentiality, integrity, and availability. To address this potential challenge, ensure that your offshore software development partner has a strong and compliant cybersecurity system in place. Establishing a legally binding contract and agreement with them that protects your data and intellectual property rights will also put your mind to rest.
Difference in Costs
The cost gap between onshore, nearshore, and offshore solutions is one of the most important variables influencing the decision to outsource software development. Onshore software development is the most expensive option because it entails recruiting developers from the client's home country, where labor costs are typically high. Nearshore software development is slightly less expensive because it entails employing developers from neighboring or nearby nations with reduced labor expenses. Offshore software development is the most cost-effective alternative because it entails hiring developers from distant nations with much reduced labor expenses.
According to FullStack Labs, the following are the average hourly wages for software developers in various regions:
- $100-$250 onshore (North America)
- $30-$80 nearshore (Latin America)
- Offshore (Asian, Eastern European, and African countries): $25-$50
As you can see, the cost differential might be significant depending on where the software development vendor is located. Among the most popular offshore software development destinations are India, Bulgaria, China, Georgia, Ukraine, and Poland. These countries have a vast and diverse talent pool, as well as low-cost and high-quality software development services.
The Benefits of Offshore Software Development
Offshore software development is a strategic as well as a cost-effective choice. In this section, we'll explore some of its key advantages.
Focus on core operations
You can free up time and resources to concentrate on crucial business operations like marketing, sales, and customer support by contracting with an offshore vendor to handle software development. You can also save time and money by not having to hire, train, and manage an in-house software development staff.
By outsourcing software development to an offshore vendor, you can gain access to a large pool of expert specialists who specialize in the tasks you want. You can also take advantage of the latest technology and developments available from the offshore vendor.
A better and more global talent pool
Regardless of where they are located, you can find the best developers for your project by outsourcing software development to an offshore vendor, giving you access to a wider and more global talent pool. You can also benefit from the offshore vendor's cultural and linguistic variety, which can improve your software product.
Quicker time to market
By outsourcing software development to an offshore vendor, you can reduce time-to-market since the offshore vendor can deliver your software product more quickly and efficiently. This is natural since the offshore vendor specializes in the specifics of a software project already, so no training or onboarding time is required.
They care about their reputation
You can be sure that software development will be completed to the highest standards when you contract with an offshore vendor because they will work hard to live up to your expectations. Since bad reviews can put them out of business, vendors usually go the extra mile to take care of their reputation. You can also benefit from the offshore vendor's long-term and strategic cooperation, which can help you build your business and achieve your goals.
For businesses looking to outsource their software projects to a dependable and cost-effective vendor, offshore software development is a feasible and important choice. Offshore software development can provide numerous advantages, including the ability to focus on core activities, gain access to skilled specialists, tap into a larger and more global talent pool, reduce time-to-market, and ensure quality and reputation. However, there are also obstacles and hazards associated with offshore software development, such as time differences, cultural differences, a lack of openness and involvement, and data leak threats. Businesses that want to engage in offshore software development should plan extensively, clarify their goals and expectations, stay up-to-date on current trends, and thoroughly investigate their outsourcing candidates.
Choosing the right vendor is your high-quality guarantee. If you're looking for a software development vendor, consider Flat Rock Technology.
Flat Rock Technology is proud to offer high-quality and cost-effective software solutions to clients across continents. We have a team of experienced and competent engineers who can handle any software project. Contact us today!