Five Pitfalls to Avoid When Offshoring Software Development

Have you ever looked for software development talent abroad? If so, it’s highly likely you’ve already come through a bunch of materials about offshoring. Doesn’t it seem to you that all the benefits of this business model are too good to be true?

Offshoring has both light and dark sides. If you’re considering it for your business, check some of the most wide-spread pitfalls, as you should be ready to face some of them when delegating your activities abroad.

#1 Failing to choose a proper business model

The number one question when starting to look offshore is how to organize your activities. Will you follow the captive business model or act through a third party? A small tip: if you have no tech expertise and need software to be developed, go with outsourcing. If you have expertise but need to strengthen it, freelancers or your own team would be a solution. No matter what you choose, remember that a correct decision is halfway to success.

#2 Preferring the cheapest

A popular mistake many business people make when turning to offshore software development talent providers is paying attention to price tags only. Clearly, you expect to get financial benefits yet it’s not a wise decision to employ a provider just because you get lower rates. Any decision should also be grounded on a range of other factors, including expertise and skills. Remember that cheap does not always equate to good.

#3 Mis-estimating the talent pool

One of the popular reasons to move offshore is the lack of talents in your home country and their availability abroad. If you have no clear answer regarding whether that talent you need will stay in your offshore destination or migrate, you’re most likely doing a disservice to your business, i.e. if employees choose to leave the country you may again face a lack of qualified specialists (thus offshoring won’t bring the expected benefits).

#4 Not tuning the communication channels

In any partnership, communication is essential and if you fail to tune your interactions to your benefit, then offshoring may not perform as expected. This is even more the case when there are differing time zones (thus big respective time differences) between your home country and the offshoring location. Defining a specific time for calls and reporting is essential, as you must stay on the same page throughout the development process.

#5 Ignoring contract terms

Of course, when you start working with an offshore location you expect the best results. You will also want your partnership to be as efficient as possible. Therefore, after you’ve already decided to offshore software development and have chosen a vendor to work with, it’s high time to review the contract. When doing so, make sure that it includes such points as IP rights, data protection, quality and performance expectations, and other essential aspects.

Conclusions

Now that you’re aware of some of the pitfalls of offshoring, you have more chances to attain a win-win situation. But choose wisely! And to spread your culture and get software development talent truly immersed in only your product, it may be worth opening your own offshore office. With it, you will promote your brand locally, close vacancies efficiently, share knowledge with your new team easily, and overall create a more productive environment.

If it seems to you that operational issues will consume much of your time, don’t worry. You can delegate them to a local company. For instance, if you choose Ukraine with the abundance of quality IT talents as the location for your office, take a look at Alcor and their unique business model. They can help you fill the needed positions, even rare ones like AI and ML, automation, IoT, quality assurance and data analytics, and run the local office for you.

The last point I would make – before you start offshoring your software development talent – learn as much as possible about any likely consequences. Take a final decision only after comprehensive research and considering all the associated risks and benefits.