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Top Reasons for Nearshore Software Outsourcing

As the Nearshore Software Outsourcing industry continues to grow, many companies are considering Nearshore IT services for their own company. So what is nearshore software outsourcing?  In short, it is when a company outsources their work to a nearshore software development center in countries with lower costs that are similar to more traditional offshoring destinations but the centers themselves are closer in geographical proximity and time zone.  Nearshore software development is typically used to develop or maintain business applications and platforms. As the recent Covid crisis has driven many people to rethink their careers, a huge need has opened up for software developers eager to build and get experience building modern applications as well. 

Several Outsourcing Alternatives

Nearshore outsourcing is not a new concept and it has been around for several years. Nearshore IT services have become very popular with many companies, as they do provide significant benefits to the businesses who use them. In this blog post, we will discuss five reasons why Nearshore Software Outsourcing works well for both clients and providers alike. Outsourcing software development has become a business norm for firms of all sizes, from tiny private corporations to multinational enterprises. The 21st century has been called the age of rapid technological change. To be competitive, organizations must satisfy the high technology demands of their customers.

A recent Clutch.co study indicated that more than one-third of small businesses (37%) currently outsource a business process, and more than half (52%) plan to outsource in 2019.  From our own experience, we believe large corporates outsource at an even higher rate.  When it comes to software development outsourcing, there are three major alternatives. These include offshore outsourcing, onshore outsourcing, and nearshore outsourcing. This article will only focus on nearshore outsourcing.

✓ Reason #1: 

Nearshore Software Development is Popular

As mentioned, nearshore software outsourcing is very popular. Why is nearshore software development so popular today? With the advent of great collaboration tools, ubiquitous high-speed internet, and a deep highly skilled talent base, most customers find outsourcing some development efforts to a nearshore outsourcing company very appealing. 

With the assistance of collaboration tools like Slack, Zoom, and Google Hangouts, companies can speak with their nearshore development teams directly through an online medium in real-time. This allows for easier remote management as well as virtually immediate responses to questions or concerns. Second, with the aid of high-speed internet and tools like screen sharing, companies can have their nearshore developers perform tasks without ever having to leave the office. This allows for a reduction in overhead expenses for travel, which makes outsourcing efforts more cost-effective. Finally, due to the many years of experience that many nearshore development teams have, and the affordable rates at which they can perform said services, nearshore outsourcing is an attractive proposition for many companies.

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✓ Reason #2: 

Lower Costs with Nearshore Software Development

Nearshore software outsourcing provides significant cost savings. Nearshoring software development has become popular because it guarantees a better value and significantly reduces costs for customers that outsource development efforts to Nearshore service providers. We believe this is a unique aspect of the nearshore model relative to farther away development centers in India and Eastern Europe or even East Asia.

From our experience the farther from U.S. shores and time zone you go the lower the price point. Of course, the hidden costs of far-flung offshoring rise exponentially, as communication and seamless collaboration become more difficult.

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✓ Reason #3: 

A Good Nearshore Outsourcing Company Enables You to Scale

Like most outsourcing models, nearshore software outsourcing creates more flexibility. Nearshore software development provides companies with a great deal of flexibility and freedom to scale up or down as needed, without having to worry about the time zone difference and other issues associated with offshoring centers on the other side of the planet. The best nearshore outsourcing companies can afford to carry a deep bench of talented developers and train them while they sit on the beach for their next project.

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✓ Reason #4: 

Hire Top Development Talent

Great nearshore developers have outstanding recruiting teams that not only can scour the market for great talent but also can interview candidates technically.  In fact, many nearshore development firms will market their ability to hire only the top 1-2% of the market but neglect to highlight their ability to retain such talent. 

We will get to that in a moment.  But the better nearshore outsourcing companies can analyze their pool of applicants across several different points: including technical acumen, English language fluency, emotional IQ, and ability to collaborate.

The first thing that they look at is their ability to write code. A good nearshore outsourcing company will set up a simple coding exercise, even if it is just 10 questions, and review their answers for language comprehension, clarity of thought processes, and logic they use throughout.  After reviewing the answers several times over, companies can often conclude whether the candidate is qualified or not and benchmark the candidate against current employees and everyone else who has taken coding exercise.  At Azumo, we do exactly that every day.

Next, nearshore outsourcing companies will look at the candidates ability to speak English.  If the applicant has passed the coding challenge, and they're bilingual, why not just hire them?  The reality is that emotional intelligence is also important.  After all we are asking the software developer to collaborate and be productive remotely. How do you hire for the top 1-2% with that ability. Well it take experience.

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✓ Reason #5: 

Can Handle Almost Any Software Development Project

Nearshore outsourcing offers many different styles of application development: from agile to waterfall depending on their client needs – even offering options that work within both paradigms simultaneously. More importantly, well-resourced providers can provide a range of software development skillsets for many of the most sought-after skills such as Python, Ruby, C#, Java, Go, React, and Node.  Just to name a shortlist. 

Specific Software Skills

From there, clients can seek out specific skill sets that focus on the companies ability to seat developers with backgrounds in financial services, healthcare, e-commerce, and more.  The e-commerce sector may need professionals who can work on specialized back-end software systems, while the healthcare industry would benefit from more front-end developers and a deep understanding of developing applications that are HIPAA compliant. The financial services industry, specifically the banking sector, would benefit from developers who have more extensive knowledge of building secure applications and have a strong understanding of NIST. For more modern applications the developer may need to be able to connect several different open APIs or be able to develop blockchain technology and understand how to integrate digital contracts into existing systems.

Emerging Technology Experience

And then customers can go one layer deeper to find technical teams with strong backgrounds building custom solutions for Blockchain, NFTs, Robotic Process Automation (RPA), Chatbots, Data Engineering. In fact, when writing code for these various applications, you will find that certain skill-set are more suited for each application.  For RPA: Java and Python, Data Engineering: Scala, Go, Python and Java; for Blockchain: Solidity (Ethereum), Golang, C++; and for NFTs: Solidity (Ethereum) and JavaScript.

Think of each coding language as a tool in your toolbox. With RPA, the need to write code is very low, but you will need to automate tasks through Desktop applications or through web services using languages like Java and Python to integrate with 3rd party software. In Data Engineering, there is a big emphasis on data processing, Data cleaning, ETL (Extract, Transform and Load) process with the Apache Spark framework. Scala is increasingly becoming the go-to language in this group, because it resembles Python in its ease of use for building web services.

In Blockchain development, Solidity is basically JavaScript but can't be called as such. Solidity and Golang require a learning curve for beginners and need to be mastered before it can be used in Blockchain development. For NFTs, Ethereum is becoming mainstream with many private blockchain implementations using Solidity under the hood. But what's interesting about NFTs is that there are two additional languages needed: Java (for Unity) and JavaScript (for Web3 development). But we digress back to ...

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✓ Reason #6: 

Seamless Collaboration across Same Time Zone

Nearshore software outsourcing provides the opportunity for companies to hire developers that work in similar time zones and share many of their working hours. Nearshoring also helps knock down communication obstacles customers fear when looking for an offshore development partner.

Family ties

Moreover, Latin American countries are English-friendly which means you won't have any language barriers as you may encounter elsewhere. And there are strong familial ties to North America and the celebration of many shared cultural norms and holidays. From sports to shared holidays to frequent visits to the United States and South America bind the regions together.  Plus there is a tremendous amount of shared media that is transmitted from the United States to Latin America from popular TV programs to news and sports. There is a good chance you may find a Laker fan or Dallas Cowboy lover working on your development team.

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✓ Reason #7: 

Modern Software Development Best Practices

The better software development outsourcing companies align their business processes to closely follow their customers' in-house teams' project management best practices. Also, the client can gain access to the nearshore software development team's experience working as remote teams and employing strategies to reduce software development team blockers.

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✓ Reason #8: 

More Influence Over the Process and Outsourcing Team

With a shared time zone, clients also gain more control over the software development process. Granted it will not be full control since you have employed an outsourced team. However, by being able to be in constant contact with the remote team you can have more understanding with regard to development project timelines. The outsourcing partner is just a slack message or phone call away.  

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✓ Bonus Reason #9:

We Have a Unique Nearshore Business Model

As mentioned earlier, many nearshore outsourcing companies claim they hire only the top 1-2%.  For parity, we will just go ahead and make the same claim.  But the real question a hiring company should ask is just how do you retain top development talent as part of their in-house teams, especially in a highly competitive market.  

Unlike most of our competitors, we provide employee training, good working hours, interesting software development projects, profit sharing, and equity ownership. Without these incentives in place hiring from a software factory will likely lead to a lot of turnover and retraining and become less cost-effective over time.

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Are you trying to figure out how to choose your nearshore software outsourcing company?

Well, a successful collaboration with a nearshore software outsourcing company depends on a wide array of factors.

You should consider the following points to follow in finding your nearshore outsourcing partner. While yes it is true that nearshore software development has several advantages: better time zone, lower cost, and higher quality -- make sure the company has good proof points of their cost efficiency and development quality. 

You can go even further and ask them about how they retain their world-class developers, do they use reliable project management best practices, and have transparent communication protocols across their team and yours.

Why Choose Azumo for Nearshore Software Outsourcing

Azumo's unique Nearshore Software Outsourcing model provides training, profit sharing, and equity ownership to their employees. This is not common among other nearshoring companies out there.

In fact, we invest heavily in our team so that it becomes a career choice for our best developers. We instill an owners' like mentality in our workforce and when they deploy to your project as a dedicated team they work like owners in the business, looking out for your best interest.

Nearshore Software Outsourcing is one of the top growing trends that helps small, medium enterprises and startups gain access to the world's best software developers.

Let us be your nearshoring software development partner! Contact us today!


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