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Onshore vs. Offshore Software Development: How to Make the Right Choice?
Introduction
The technological landscape keeps on changing now and then, and under such unpredictable scenarios choosing between onshore and offshore software development can be quite a concern. Fortunately, there are a plethora of software development companies incepting every day so you have lots and lots of options around. However, it becomes very important to make the right choice because one wrong choice and your entire software development project can be doomed. Now it doesn’t matter which position you hold in the business whether you are a CTO or a senior project manager looking for a quick way to deal with tighter deadlines or a successful entrepreneur creating your way towards successful digital transformation, figuring out which software development approach is right for you is extremely important.
Now before we begin differentiating between the two concepts, let us take a close look and understand what these two concepts are all about. Let's begin with demystifying both onshore and offshore development.
Unveil the Concepts of Onshore and Offshore Development
Can I tell you a secret to survive in the current fast-paced digital landscape? It’s to successfully harness cutting-edge technology and create novel software. Survival of the fittest is what matters the most and slowly overcome your competitors. So even if you have an idea there is a major hitch ahead, do you want to hire in-house developers or outsource expertise to turn your vision practical from a third party within your own country and overseas?
Whichever way you go, to align corporate goals featuring seamless operations, scaling, and channeling resources in a short period, it is pretty important to conduct a software development project. In addition, having prompt access to these latest technologies can lead to increased productivity, growth, and profitability. After the massive COVID-19 hit, the idea of physical colocation of resources was completely banished. And it is a safe bet to say, this was the turning point when businesses began considering offshore software development seriously. Now let us get into the nitty-gritty of both concepts.
Onshore Development
Onshore development means working closely with the development team which is located within your own country. It’s like hiring third-party services near your location. It may quite interest you to know that till COVID-19 onshore software development was considered as a feasible approach for a successful development. Fortunately, the vision and scope have changed. Let’s say you are a US-based company and you are short of in-house software developers, for better results you need to outsource services from third-party or reliable software development companies located in the US itself. Further, I would like to mention certain points stating the benefits of onshore software development.
Seamless Communication and collaboration
Ensure proper legal compilation/regulations and standards
Real-time collaboration
Enhanced flexibility
In-person meetings
Physical proximity
Same Time Zone
No Cultural or language differences
Fewer Iterations
Intellectual property concerns can be well taken care of
Offshore Development
Our next contender is offshore software development. As the name implies, offshore development is said when you choose third-party services for conducting your software development project, the only issue is the software development company is located in a different country, maybe overseas. Now you must be wondering why there is a need for offshore development in the first place where we already have onshore development. Well, for starters, offshore development is the sure-shot way to look out for global talent pools at a budget-friendly price. It can be a beacon of hope especially for businesses that are willing to optimize expenses and at the same time willing to look out for amazing technical expertise. For example, if you are a US-based company, then you might consider hiring third-party experienced professionals from a different country, let's say India or Philippines, Brazil, or China for quite a low price. Further, I would like to mention certain advantages of considering offshore development.
Cost efficient
Easy access to global talent
Amazing scalability
Time Zone Differences can be leveraged for round-the-clock development
Cultural and Communication Barriers are manageable
So basically let your in-house professionals work for fixed hours and the offshore programmers can take care of the rest while you are asleep. This can even shorten the timeline of the project. Working in multiple shifts enables you to stay active 24/7. As far as communication is concerned, today there is a wide range of efficient collaborative tools available like Skype, JIRA, Basecamp, and Slack.
Onshore vs Offshore Software Development - Spotting the Differences
Factors | Onshore | Offshore |
Location | The software development team is located within the same country. | Here the software development team is located in a different country, maybe overseas. |
Proximity | Proximity means fewer trust issues clear communication and easy access to the development teams | Geographical distance can be quite challenging as it may lead to communication delays and reporting issues |
Talent Pool | Limited Talent Pool | Wide Talent Pool |
Language Barriers | No language barriers | Here language barrier can be an issue due to cultural differences |
Time Zone Difference | No impact since both parties are working in the same time zone. | Conducting meetings, and keeping track of schedules can be a bit tricky due to time zone differences. |
Working Hours | Aligns with local business hours | 24/7 working cycle which means there is a huge scope to save time. |
Cultural Difference | Shared culture facilitates smoother collaboration | Cultural differences can be a bliss or a bane which can lead to inefficiency in the software development project. |
How to Choose the Right Software Development Model?
Now it’s time to make a decision on which one to choose onshore and offshore development. Here I would like to mention certain factors to take into account before choosing the right software development approach.
#1 Assessing Project Complexity
Now no matter how costly this turns out to be, onshore software development works wonders for pretty complex and complicated projects, especially the ones that demand real-time interaction. Let’s say there is a project that needs the magic touch of artificial intelligence, then I am pretty sure bringing an onshore team on board can successfully assist in completing the project by navigating any and every nuance seamlessly. In addition to this, you need to consider onshore for required skills. For example, if you are conducting a fintech project then, ensure that the company is familiar with GDPR compliance.
Whereas offshore software development companies are pretty ideal for streamlined projects featuring clear-cut guidelines. So in case you are willing to develop a basic app where things can work wonders with remote coordination, then offshore is more than enough. Offshore work environments are quite suitable for generalized skills and offer the best solutions at a competitive rate.
Lastly, if you are willing for daily interaction, especially in-person meets then of course, you need to consider onshore whereas if you are willing to conduct long-term projects where weekly or monthly check-ins are fine and you are comfortable with the use of Slack, Skype, Asana, and so more then offshore is the answer here.
#2 Understanding cultural and communication factors
The next point to take into consideration for choosing between offshore and onshore is figuring out how much is the cultural difference and how to minimize the effect. Well, with onshore development teams on board, the scope for miscommunication is much less, and unfortunately, that’s not the case with onshore development. Well, with technology evolving at a fanatic pace, clear communication channels can be created and cultural sensitivity can be well taken care of. Also, if you are willing to consider time zone overlaps then offshore can be quite advantageous. Ask your offshore software development service partner to arrange overlapping working hours seamlessly for crucial meetups.
#3 Costs
Another crucial factor that needs attention before deciding between onshore and offshore is the cost. One of the biggest advantages of considering offshore development is the cost. It facilitates business with minimum wages and a seamless way to look out for skilled professionals at a lower living cost. Whereas when it comes to onshore, things might be a bit difficult to figure out here since onshore development can be way more costly in comparison to offshore. Since the development company is located near you, you might not get as many options, and that too at a reasonable price.
Final Verdict
Whether you choose onshore or offshore, both the development approaches are of a kind, and both of them have potential advantages and disadvantages. Now the big question is which one to choose? Well, it certainly depends on your exact needs and requirements. It may quite interest you to know that Google Search gets inundated yearly with people who want to know which is better, onshore vs offshore outsourcing. If you choose an excellent offshore software development service provider then you are bound to receive some value at a pretty low price whereas onshore might not be able to provide the same value at a similar price.