For many companies who are just starting up or trying to scale, outsourcing can be the most cost effective way to find technical resources to build tech solutions. However, outsourcing a project successfully on the first attempt isn't easy, not least for those with no technology background.
"Offshoring" vs "Nearshoring"
Outsourcing development to offshore tech companies (offshoring) has been a popular tactic for many companies over the years (thanks to the differences in the cost of labour in those countries compared to their own).
However, those who go down this route quickly realise the initial savings on cost are outweighed by problems caused from having their employees so far away!
Consequently, "nearshoring" is becoming a more popular alternative for those who would rather work with teams that (although more expensive) share similar cultures and time zones.
For example, a company in London may decide to nearshore to Portugal or Poland rather than offshore to Vietnam or India where the cultural differences are wider and language, in certain countries, can be a barrier.
Clearly set your expectations
The key to successfully offshoring is to structure the relationship between your company and your technology partner clearly so that all parties know what is expected of them.
Regardless of whether you decide to hand over development of your project to a company that is near to you or further away, it is crucial that you have this clear structure.
It is also essential to establish a point of contact in your team who understands the business and can efficiently communicate with the outsourced team to transfer the knowledge they need.
Do your research
Outsourcing tech development is a big step: it will consume a significant part of your budget and you are going to be reliant on the team you choose for a long period of time. For this reason, it's important to think of outsourcing as a partnership. Spend the time researching companies, talking to references and others that you know that may have outsourced work to the same country.
A team that understands your current challenges and future needs will help you to avoid potential hidden costs that will arise from the need to handhold or train the team. Successful outsourcing relationships are ones where both parties take a long term approach to the engagement.
Those experienced in the industry know that work often ebbs and flows, and, for startups especially, there may be periods where tech needs to be delivered at a fast pace to meet customer needs or new opportunities that might arise. Finding a tech partner that can help you through these periods is crucial as your company’s ability to respond to a new opportunity may make or break it.
Know what you need
When looking to engage an outsourcing tech partner, think of it as any other hiring process. Know the skill set you are looking for and come with a defined set of requirements that need to be fulfilled. In addition to having a robust mechanism in place that gives you visibility into how your potential partner will work, you also need the ability to influence how the work is performed.
It is also important to get to know the people behind the company. They may have an excellent marketing scheme demonstrating previous work for some tier 1 clients, but what did they actually do for that client? How deep is their knowledge and practical experience in the technologies you wish to deploy?
Speak to previous clients
Like any hiring process, get references and speak to them. By asking the right questions to the right person, you may find out that a potential partner has worked with technology that they only have a basic knowledge of - or perhaps they have only worked for that world famous client in a fringe capacity.
Finally, when you approach a potential outsourcing partner, make sure to talk to the team that will actually be working on your project. Many companies will put their best staff in front of you to win a sale but when the true work begins they may be bringing in the B-team. Having a designated point of contact within the company you hire and ensuring that you have clear lines of communication to that person will also reduce this risk.
At Atom CTO we have been working with nearshore and offshore teams for the past 20 years and have built and run teams across the globe. We work with companies such as yours to de-risk outsourced projects. We can act as the bridge between your business and your technology partner so that you can concentrate on generating leads and driving sales.