We recently advised how to choose a software development company. So, you have compared all the offers of providers but still have not made a final decision. In this article, we will analyze whether the location factor of a partner company is important and explain on the fingers some key concepts about outsourcing software services.
If you follow a face-to-face business approach, then you definitely need to choose a provider company with a representative office in your country. However, in recent years, many corporations have moved online and are actively gaining customers around the world without having a centralized office. Anyway, the company’s widespread global presence reflects the projects’ international scope.
Generally, there are three common approaches to outsourcing: Onshoring, Nearshoring, and Offshoring. Although they are all about the same idea – paying a third party to perform work for your project, but it’s important to understand how they differ from one another.
Offshoring – moving development operations to a vendor located in a distant country.
Generally considered known as the most budget-cutting approach. The quality of work is also a strong point and often at a high level. On the other hand, the time difference might be an issue if you’re in need of real-time communication or quick fixes.
Onshoring – hiring a software development provider within the same country.
Unlike outsourcing to other countries, onshoring is more expensive and often lacks staff. Of the advantages, it is worth noting the absence of a language barrier and a high level of cultural similarity. Local IT companies also use domestic tools, facilities, and infrastructure.
Nearshoring – outsourcing IT activities to a software development company based in a nearby country.
Depending on the geographical location of your company, the quality of specialists from nearby countries will differ. Therefore, Nearshoring is not a universal solution, but an individual one for each business. Of the advantages, is the minimum cultural and language barrier. Of the minuses, there is often a shortage of employees.
Finally, creating global digital products is always a challenge and there are many different work approaches for software development companies. Let’s take for instance AMIS Group. Our central office is located in Miami, USA, with additional offices in the Middle East and Asia, which allows us to meet or attend events very actively. But at the same time, the engineer’s team is decentralized, which indicates a flexible approach to work and reduces expenses. The result is a kind of hybrid, which seems to us the best solution.