Building a skilled development team in today’s ever-evolving tech space can be challenging. With a significant shortage of tech talent and exorbitant salaries, hiring a local development team, especially in the US and Western Europe, is a process that most companies just don’t look forward to.
While outsourcing is a good alternative, it isn’t a sustainable long-term solution. This is because when you outsource your development processes to third-party vendors, they put together a temporary team of developers for you to work with on one-off projects. These team members do not work only for you but for different clients across the globe, sometimes even concurrently. This can lead to low-quality code and a lack of customer focus.
And that’s why going offshore is a better solution.
The Offshore Development Model
Offshore development is when an organization builds a dedicated development team in another country. The team is a permanent, value-adding extension of the business, and the employees you hire are regular, in-house employees and not outsourced help. The only key difference here is that they are based elsewhere instead of working from your local office.
Why is the offshore model effective?
There are many reasons why businesses build a dedicated offshore development team in emerging tech nations like India and Ukraine. Some of them include:
Lower operational costs
Building teams in countries like India, where the cost of living is significantly lower than in Western countries like Paris, London, or New York, means that businesses can generate a considerable amount of savings. The office premises, equipment, employee-centric benefits, and salaries are all a lot cheaper.
Access to skilled tech talent
Across Western Europe and America, highly qualified, skilled engineers can be hard to find. On the one hand, according to research, the tech talent shortage in the US has more than tripled in the past decade. On the other, evolving tech economies like Bangalore, also known as The Silicon Valley of Asia, produce more world-class IT engineers than anywhere on the planet.
The ability to scale your business
Hiring talented engineers and scaling your business at speed can be challenging when you can’t find the right people at the right price. By leveraging the offshore model, organizations can establish larger offices, recruit skilled engineers quickly, and change more dynamically.
So, if we had to answer the question, ‘Offshore Model: Effective or Ineffective?’, we’d definitely say effective, provided you work with the right partner!