Every workplace operates differently in terms of its specifications, execution, targets, and objectives. To meet the unique demands of modern businesses and remain competitive, software, apps, and websites must be customized to meet the specific requirements of each company. There is no shortage of commercially accessible software these days, but in most cases, it falls short of meeting the detailed operational requirements set out by the company.
If you're just starting in business and don't have the capital to employ a full-time IT specialist, this is an even bigger challenge for you. Outsourcing software development to an IT services provider with a staff of qualified developers able to meet the demands of various sectors and enterprises seems to be their best bet.
Developers have a deep understanding of client’s unique demands and can tailor their products to meet those specific requirements. Whether it's complicated software for big companies or simple websites for beginners, the developers can handle it all. Clients can devote more time and energy to the innovative aspects of their company when they outsource software development to an outside firm.
What is Offshore Software Development?
When developing software, it is common practice to outsource certain jobs to a team located in a foreign nation, frequently across a large time zone. A U.S. firm can link up with an Indian, Ukrainian, or Filipino development team, for instance. Businesses can make use of this approach to get specialized expertise, find cost-effective solutions, and finish projects faster. Offshore teams manage a wide range of responsibilities, such as design, programming, and the creation of online and mobile apps, as well as their support and maintenance.
Offshore software development, in contrast to an Offshore Development Center (ODC), takes a more specialized approach by catering to each project's unique requirements. An offshore development center (ODC) acts as an extra set of hands for your in-house team, supplying you with a permanent, well-equipped development crew that focuses solely on your projects. Businesses who want their initiatives to be consistent should use this strategy. But for many new companies and startups with immediate demands, offshore software development is still an effective and adaptable option.
Benefits of Offshore Software Development Services
- Cost and Budget
If you're looking for ways to save finances, outsourcing to a remote team of developers is a great choice. Rough estimates show that you can save 34% through outsourcing compared to employing a local developer. That's because compared to hiring a developer in your area, the costs incurred by offshore development organizations and independent software developers based in developing nations like Indonesia, India, and Ukraine are far lower. To give you an idea of the price range, IT outsourcing in India typically costs between $18 and $50 per hour, whereas in the US and UK, it can cost anywhere from $25 to $250 per hour. For new businesses on a tight budget, this is a fantastic way to save costs.
- New Ideas and High Standards
Offshore firms can match your specifications and guarantee a top-notch final product since they have teams of well-certified developers who are dedicated to innovation and quality. It will take time and money to train new workers to be as productive as an offshore developer if you want to recruit an experienced expert.
- Skilled Experts
The greatest developers from all around the world are at your fingertips when you outsource. You can hire top-tier, credentialed developers who are willing to work within your budget to create a product that meets all of your specifications.
- 24/7 Development Cycle
As a result of the inherent differences in local and remote working hours, it is possible to guarantee a round-the-clock development cycle when collaborating with offshore developers, who are likely to be located in a different time zone. You may get your project done faster by taking advantage of the time zone difference between developers located in various parts of the world.
- Can Focus on The Creative Aspects of The Business
You can free up more time to focus on what your organization does best by outsourcing complex software development chores. This is especially important for new businesses since they are still in the early stages of development and need your undivided focus as they expand. You can focus entirely on the creative parts of company plans, management, and implementing new ideas if you avoid development.
- Collaborative Duty
Managing risks as a beginner in business is more challenging than for seasoned entrepreneurs, particularly when dealing with non-IT companies as clients. Offshore developers and clients both share responsibility for risk management and its effects when they outsource, and the organizations doing the outsourced work will naturally do a better job of mitigating those risks.
- No Need for New Infrastructure
In addition to the reduced cost of recruiting developers, outsourcing also helps with operational expenditures. It is unnecessary to invest in software development necessities like buying equipment or renting an office to house the developers. The development process will be accelerated in the end since the offshore development business will handle all of these.
Offshore Software Development Guide for Startups
Recruiting an in-house team to build software is an expensive deal, and as a startup, you're bound to encounter a shortage of resources. Hence, employing a software development business based in another country is your best bet. You can start your project faster and at a lower cost with this method. Plus, you'll be able to recruit top-tier information technology professionals.
However, if you are confused as to how to begin using offshore software development services, here's a quick overview.
1. Market research
Before you choose an offshore software development business, make sure you do the necessary research. Make sure you research each company thoroughly by looking at its market valuation, website, social media, and portfolio history. After that, find out what the skill set is and how well the firm is at solving problems.
2. Pick a model for remote teamwork
Project outsourcing, dedicated teams, and extended teams are some of the most popular remote cooperation models in the IT sector. You should compare the models' pricing structures and the degree of software development freedom they offer before making a final decision.
3. Make a financial plan
Before engaging in offshore software development services, it is essential for startups to carefully manage their budget. Avoid the mistake of thinking that a high price tag indicates a good quality product. Without lowering your standards, you can always haggle for a lower price. However, before that, determine your budget.
4. Communicate effectively
It is critical to communicate effectively while working with an offshore workforce. Plus, it needs to work. Always update the team on the latest needs, including objectives and deadlines. Establish and sustain consistent communication with the group. Many modern communication tools are at your disposal, including messaging applications, collaboration platforms, video conferencing apps, and more.
5. Act with care
Carefully selecting your offshore software development partner won't cost you a thing. Find out what you need, and then employ the finest one.
5 Most Successful Startups That Used Offshore Software Development
Success has been elusive for many firms until they figured out how to collaborate with offshore software development teams. While making use of offshore software development teams, these organizations have grown into key players in the sector.
A few noteworthy examples include these:
1. Slack
After its creators saw Slack's potential as a messaging app, the company transformed it from an internal tool for the failed game Glitch into a game-changer. Slack became an industry leader in collaboration technologies and rapidly expanded by utilizing offshore staff. With over 54.1 million active users and $5.97 billion in revenue as of June 2024, Slack is a platform that never sleeps. Across Asia, Europe, and North America, the firm employs over 3,500 individuals. It is now valued at $26.51 billion and has a 21% market share.
2. WhatsApp
The deliberate use of offshore development is shown by WhatsApp's growth from a startup to a worldwide messaging giant. The US-based service, which was co-founded by Jan Koum and Brian Acton, was able to develop rapidly and keep expenses low by utilizing a staff of Russian programmers. Facebook paid $19 billion to acquire WhatsApp, a result of this strategy's success. The platform has more than 2.78 billion users worldwide as of July 2024. With a staff of over 2,700 people spread across six continents, WhatsApp can produce $906 million in revenue.
3. Skype
Thanks to Estonia's rising IT talent, which provided affordable, high-quality engineering, Skype revolutionized internet communication. Thanks to their collaboration, Skype's co-founders Janus Friis and Niklas Zennström were able to build the platform into a market leader in video and voice communication very quickly. Microsoft paid $8.5 billion to acquire Skype in 2011 because they saw the strategic potential in this strategy.
4. Basecamp
As an early adopter of remote work, Basecamp has always made the most of distributed teams' strengths. Jason Fried and David Heinemeier Hansson have built their project management solution by championing global talent. A lean and inventive organization with 170 people across many countries and $280 million in revenue is what it maintains. When it comes to expanding a company's reach without the overhead costs of conventional office space, Basecamp has established a new standard.
5. Alibaba
The success of Alibaba in the e-commerce industry is a prime example of the value of using offshore development teams. Jack Ma, the platform's founder, rapidly grew the platform's user base by bringing in top IT talent from the United States and throughout the world. Alibaba has become a dominant player in the worldwide e-commerce industry, with a 42% share of the Chinese market and a staff of over 80,000. The company's revenue is $130 billion.
These cases show how companies can shift the game by using offshore development centers. Startups can use global talent to drive growth and success by embracing best practices and successfully navigating offshore development.
Conclusion
The software outsourcing sector has been incredibly adaptable, making its services accessible to even the most niche enterprises. On the other hand, software outsourcing businesses must be extremely flexible to handle the large volatility that comes with most startups' limited resources.
Startups should exercise caution when selecting a software outsourcing service for this reason. Along with qualities like undivided attention and continuously tailored service, one of the strongest markers of a dependable and effective relationship is an agency partner's willingness to work with tight resources while being willing to explore scaling down even more.