Offshoring is a type of outsourcing, where you subcontract certain tasks or business processes to a company located in another country, often to cut back on costs.
IT projects—like web or app development, support and maintenance of systems, and even graphic design—are some of the most outsourced tasks among companies, especially for some where it’s not practical to hire in-house developers and/or designers.
Due to the complex nature of these tasks, many businesses prefer to outsource to companies within the same city or country rather than to offshore companies, considering factors such as cultural understanding, time difference, and of course, proximity.
But without the advantage of physical accessibility during this time (2020), there’s not much difference in working with local vs offshore suppliers.
Of course, there are still challenges that arise from the factors mentioned above, but with the right supplier, you’ll find that offshore collaboration has its own benefits as well.
Here are some pros and cons that you can consider when working with an offshore IT supplier:
1. Time difference
Some people might consider it a disadvantage to work with a team from a different time zone, but over the years, we (and most of our customers) have found it beneficial.
For instance, our customers from Europe can send us small tasks at the end of the workday and find them finished the next morning when they come in to work.
Still, it’s important that you and your supplier at least have overlapping work hours so that you can still have live meetings for project status updates (our own standard is at least four).
2. Cultural barriers
In IT projects, the cultural factor mostly affects the work relationship between the supplier and customer and not the work itself—as opposed to certain work that really requires cultural understanding, like SEO and marketing, for example.
Maintaining transparent and consistent communication is one way to resolve cultural differences with your supplier.
As long as both parties are clear on the project requirements and task expectations right from the start of the collaboration, the project is likely to go on smoothly despite being from different backgrounds.
3. Cost savings
You can save a lot by getting development done with offshore IT companies.
At 1902 Software, our rates are almost 50% lower than local agencies, especially in Europe, US, and Australia. (See our price list.)
Often, higher cost is associated with higher quality, which is why companies are willing to go with more expensive agencies than save with outsourcing companies. This is not always the case, though.
Always see for yourself and check customer reviews and portfolio of previous projects to check your prospective supplier’s output quality and reputation.
4. Privacy and security
Data privacy is an important factor for customer trust and overall brand reputation these days, so make sure to work with a supplier with tight privacy and security measures in place to avoid compromising your data.
At 1902 Software, we have standard data processing agreements that we sign with our customers at the start of every project, to help them comply with the EU’s General Data Protection Regulation’s (GDPR) clauses on transferring and processing EU data in third countries.
5. Diverse skillset, knowledge, and experience
With many technical talents around the world, it can be limiting for your project to consider only local companies or freelancers.
Through outsourcing, you can take advantage of getting an experienced team in your project, at half the usual cost.
Our developers go through months of in-house technical training before working on customer projects and continue to attend refresher workshops and knowledge-sharing sessions.
Many of them have earned technical certifications in the platforms that they work with as well.
Working with an offshore IT supplier may be challenging in some respects, but that holds true even for your local agencies as well.
Ultimately, it’s about choosing to work with an IT company that can deliver what you need—near or remote.
In the next part of this series, we’ll share some tools for remote collaboration that can help you work more efficiently.