June 20, 2018
What is Nearshore App Development?
Offshore development used to be the way to go when outsourcing software engineer talent. North American firms wanting design or development work can achieve great ROI by hiring skilled technical workers from certain offshore countries, and this has been true for several years.
However, there are several problems with offshoring, and these can reduce or even completely cancel out the financial benefits you sought in the first place.
Rather than just considering the hourly rate, you need to consider several factors as part of the total cost of engagement with the company you choose to do business with. Below are a few of the drawbacks to offshoring and some examples of the considerations arising because of them.
Email and Slack cannot completely eliminate the need for phone meetings, video conferences, and group chats which are hard to arrange with a 14 hour time difference.
How many in person meetings would be nice to have on a 6 month project? There aren’t a ton of direct flights to Belarus, and you won’t be home for dinner.
Language and Culture
Does your offshore partner have a working style and work ethic that suits you? Is criticism accepted on face value or does it need to be communicated in a particular way? Do you know if team members will, when necessary, say “no, we can’t do that, but let’s try this instead”?
Business practices and regulations
What is acceptable and legal in a foreign country may not be in the US or it might just not meet the expectations of your clients/stakeholders that rely on the technology you are providing.
There are many risks regarding the quality of their team, their process, and the tools they use. Are they using industry best practices and modern development or project management software? Can and will they protect your data and IP? Have you visited their office? Are you sure it exists? How stable is the government in the country you are outsourcing to?
The advantages of working with nearshore teams are easy to see
Now, overall it is true that the hourly rate of offshore talent is a fraction of the cost compared to the US if you can beat the odds and mitigate some of the above risks (ie: you lived in the chosen country, speak the language, understand their culture, and/or don’t mind late nights, early mornings, and micro managing the people you hire).
However, there is potential for miscommunication, delays, conflicts from different business practices, and other wasted time. This can end up sending you over budget, while delivering inferior work to go with your extra headaches.
What’s the solution?
Maintain the highest quality of work, keep communication and workflow simple, and increase ROI on your development costs with nearshoring.
Specifically, you need only take a look inside America’s hat to find a machine that is generating app development talent equal to that of the US and — thanks to the current exchange rate — at much lower cost. The differences in cost of living combined with fewer multi-billion dollar tech companies competing for workers are two factors playing a role in this situation.
So why not let a Canadian company (perhaps one of the top app developers in Canada) worry about recruiting and managing talent while you focus on your core business?
The BC labour market is healthy and it continues to improve with ready access to quick entry programs to bring additional skilled foreign workers. The financial benefits of nearshoring will be obvious (contact me anytime for a free consultation and estimate) but you can also get excited because Canadian companies are easy to work with.
Unlike offshoring, contact your nearshore team any time of day that you are up because you on the same time zone. Well, within reason. Everyone has to sleep sometime. To successfully work with an external team you need effective communication. It’s way easier to stay agile, facilitate changes, and clear up misunderstandings in a timely manner when you are both awake and alert.
We’re closer than you think. From Seattle? You can look forward to scheduling a morning or afternoon meeting with your nearshore team by hopping on a 30 minute scenic float plane, straight from downtown harbour to harbour. Most other places in the pacific northwest can be done in a day trip or overnight.
Language and Culture
We speak your language. We may disagree on whether to call it soda or pop, but business relations can feel the same as they do at home when working with a Canadian team. English is our language of business and we are experts at transparent, honest communication. The foundation for our business relationships already exist and will be built up much faster.
Business Practices and Regulations
We conduct business with the same rules. Canadian and US business regulations are similar, so you can feel comfortable knowing each other’s protocols and expectations while trusting your intellectual property to be handled with care and respect. Expect reliable and familiar methodologies from a Canadian software engineering workforce.
Unless you’re playing us in hockey game, it’s very little. With similar economies, stable governments, high transparency and low volatility, you can reap the rewards without the uncertainty.
Not only do you benefit from the competitive price offered by Canadian companies, but you can ultimately rely on our quality, skill, and commitment.
Shortsighted US firms choosing offshore workers are solving the short term problem by reducing some initial project costs.
Many times those firms would have been better off to pay slightly more up front for a better product by better people. Nearshoring provides quality products, good savings, and great business relationships.
For companies in the Pacific Northwest — nearshoring is as close as Vancouver and Victoria BC. These tech hubs offer the perfect opportunity to save money on talent without sacrificing quality or increasing risk.
If you are thinking about working with external talent for design or development services, consider looking a little closer to home.