Top IT Offshoring Myths to Leave Behind
Recent years witnessed the significant demand for IT offshoring with the market expected to reach $283,476M in 2030, growing at a CAGR of 10.13%.
As remote work gradually becomes the norm, building a distributed team is no longer the bogeyman it once used to be. Conversely, it is now a strategic move for many businesses to access talent cost-effectively without geographical restrictions.
And yet for many, the misconceptions about offshore software development are adequate to put them off the idea, causing the business to miss out on remarkable growth opportunities.
If you’re one of those sceptics, let us together debunk a few common IT offshoring myths now.
1. You can lose control in your projects
Many enterprises fear that offshoring development creates challenges in managing the project, even the most basic tasks, resulting in serious losses.
Nevertheless, there are several offshoring models that can be considered to meet your specific needs, with different levels of responsibility and customer involvement. Regardless of the model you choose, no reputable vendor will disappear on you and leave you with empty pockets.
If you prefer to be heavily involved in the project and full control for the project, the Staff Augmentation model may be the best fit. This approach entitles you to hire external specialists as needed to supplement your existing team, with you as the resource provider and decision-maker.
Alternatively, if you want to completely hand over human resources allocation and project management responsibilities, the Project-Based Model may be a better option. This requires a high level of trust, as the outsourcing company takes full responsibility for the project’s management and success, including appropriate workflows and key performance indicators, with consideration of the client’s input.
For those who find both models too extreme, there is a compromise in the form of the Dedicated Team Model. This strategy frees you from team management duties, but your project manager or product owner may remain involved in the software development process, making all the critical decisions. As a result, both the client and the vendor share responsibility for the project.
2. Offshoring means low quality products
If you only prioritise finding the lowest prices, you’ll be more likely to engage with under-qualified contractors you’re not going to get quality output.
Every country has both exceptional and terrible software developers. What’s important is finding a way to separate the wheat from the chaff. Thus, regardless of the industry, successful IT offshoring requires dedicating sufficient effort to recruit and develop a high-performing team,
What we do is simple - we provide a straightforward and transparent digital team model which gives unlimited access to the top talent pool in Vietnam. This allows you to pick the top-tier remote developers to work for your projects.
3. Effective communication & collaboration are impossible with offshoring
Another popular IT offshore myth is companies can’t have good communication and productivity with remote teams given varied time zones, geographical distance, language barriers, and cultural differences.
When thinking of meetings with overseas developers, people will rarely picture immaculate vocabulary and flawless grammar. Instead, they envision a conversation filled with awkward pauses, slurred English, and repeated sentences of ‘’You speak very quickly. I don’t understand you’’.
Their impression of offshore development centre is also a factory-style assembly line of non-verbal execution, but this is not always the case.
At KMS Solutions, we ensure all of our engineers possess a high level of English proficiency, enabling them to fluently communicate and assist clients on any matter in English. Furthermore, we conduct frequent business communication skills training programs to empower staff to have meaningful and clear communication.
The availability of modern communication tools such as instant messaging, video calls, project management tools, and emails also make it easier for companies to interact and keep track of their remote dev teams. In KMS Solutions, we use Google Workplace, Jira, Miro, and Slack. Additionally, we make use of agile which heavily lean into a constant reporting mindset and promote transparency.
For the last 12 years, we’ve managed to successfully deliver projects with corporations around the globe. This has enabled us to establish effective communication systems between our developers, learn how to compromise on work hours to ensure always be available when needed, and bridge any differences.
Additionally, having a geographically diverse team can expose you to fresh outlooks and experiences. If you’re concerned about cultural differences affecting teamwork, note that most tech firms follow global workplace standards that encompass professional conduct and ethical principles.
4. Offshoring service providers might compromise your security
Organisations often have security concerns when it comes to offshoring software outsourcing.
Considering that data security is one of the fundamental pillars of today’s business, this is a valid concern.
But there are ways to address the concerns. One effective solution is to implement a non-disclosure agreement (NDA) and a non-compete clause (NCC). Businesses often have concerns about the security risks of outsourcing work to another country. Protecting data security is a fundamental aspect of modern-day companies, and offshore outsourcing can pose potential threats.
However, there are ways to address these concerns. One effective solution is to implement a non-disclosure agreement (NDA) and a non-compete clause (NCC). An NDA restricts access to any confidential information shared with the offshore company for the project's sake, while the NCC ensures that the offshore vendor will not compete with you by starting a similar trade.
These documents can be customised to your specific project's requirements, so you don't have to worry about any rigid stipulations that can put your organization at a disadvantage.
Additionally, it is vital to check the offshore company's policies on privacy and intellectual property, along with the prevention technologies they employ and their ability to oversee data flow. Verifying whether they educate their employees on security concerns is also advisable to ensure that the offshore service provider doesn't pose any danger to your business.
5. Offshoring only feasible for companies with considerable capital
According to a recent study by Upcity, 35% of small businesses have outsourced a business process within the last two years, and 82% of them have decided to outsource even more after the COVID-19 pandemic.
The primary distinction between large and small businesses is the motivation behind their outsourcing decisions: the former seek to reduce expenses, the latter seek to increase efficiency. So even though the reasons may differ, the advantages still exceed the disadvantages.
With IT offshoring, small firms can focus on their core competencies, reducing their workload and increasing productivity. They can access experts that would otherwise only be available to large businesses, without any geographical limitations. As a result, the quality of their products or services can significantly improve.
The lack of geographical constraints also opens up opportunities for small companies to explore new local markets and develop products that would have been too expensive to develop in-house.
On the other hand, middle-sized companies have been the largest contributors to the growth of IT outsourcing, with their average outsourcing increasing from 9.1% to 11.8% in 2020. Even startups can consider outsourcing tasks to launch their minimum viable product (MVP) quickly, as seen in the examples of Skype, Slack, and Github.
Of course, not every IT offshoring service provider is the best investment you can make. Every sector can have a few bad apples that spoil the barrel, and one must be cautious when making any decisions. It's crucial to watch out for warning signs such as a lack of transparency, no project status updates or client consultations, absence of strict guidelines, or overpromising.
However, there are several ways to ensure that you're making an informed decision. Utilizing resources like internet ratings and reviews such as Clutch or GoodFirms can provide insight into a vendor’s true reputation.
It's important to take your time and thoroughly research potential providers, ask relevant questions, and assess whether the IT provider is trustworthy and competent.
Don’t rush into a decision and don’t ever fall for myths