IT offshoring or outsourcing that began in the 1980s gained steam as various IT service providers came to the fore. The phenomenon came into being as companies realized they could find talent in multiple locations — even ones outside their country. And no longer do they need to hire employees at their doorstep while offering a wide range of services.
It became a well-established practice during the pre-pandemic times and will continue its reign for years. The rationale was simple: why would you pay $150K to get your software built in the US if you can hire a developer for $30K in India? After all, post-2020, we were forced to switch to remote collaboration mode.
Here are some interesting statistics about the growth of outsourcing/offshoring:
And today, the said concept has evolved. The offshoring partners work with global delivery centers. They do much more than provide technical support and have strengthened their skills and expertise to function as consultants. It is while supporting businesses to drive better decisions.
But why is offshoring gaining this ton of attention? Let’s check it out.
Offshoring doesn’t come without risks and problems, as with any other engagement. It may arise due to poor planning, communication & neglecting other concerns. While most companies invest their energy in selecting countries, cities, and vendors, along with price negotiation, many businesses forget to evaluate the processes beforehand. It would require consideration of what should be offshored versus what should remain within the organization.
And, without a standard methodology to differentiate functions, most executives struggle to distinguish between core processes that they need to have a grip over, critical processes that they can purchase from the right vendors & commodity processes that can be outsourced. As a result, companies offshore the wrong strategies that they think are not strategic and end up bringing some of them in-house.
In today’s times, companies must understand that they have a continuum of options and an array of engagements to choose from that would deem fit for their purposes. Here’s a closer look at how you can ensure a successful engagement based on various factors.
Choosing a suitable engagement model is equally important as choosing the right technology partner. Further, the type of engagement allows you to have the right balance between budget, quality & timeline. Here are some insights we have gathered on the kinds of models you should consider when planning your next partnership.
If you think IT offshoring would make sense for you, it’s good to start assessing a partner and their models. They can share your common vision while supporting your goals and making it a cultural fit for the organization.
We can help you build the right team, from sourcing resources to interviews and due diligence. We then form the team and help set up their day-to-day operations. Once you feel the team is ready and at par with your requirements, we will transfer the unit to you. Further, all our offshore engagement models give you the option of trying before buying, which means you do not have to worry about a long-term investment until you are confident that it provides you with the correct value.
Rishabh has been a trusted partner for mid-sized businesses and enterprises for over two decades to drive digital transformation initiatives. And over the years, we have built strong know-how across product engineering, application modernization, cloud enablement & digital transformation services.
In the year ahead, offshoring will be an antidote to economic woes. Software development will continue to be the topmost offshored IT function, with US businesses inclined to outsource some of their new or ongoing development projects. Even as the economic outlook appears gloomy, Forrester suggests that software growth will overshoot pre-pandemic levels.
Additionally, the good news is that with software development offshoring, the global health crisis ushered in a completely different way of working with a distributed offshoring model. An increasing mix of hybrid teams makes up in-house teams and outsourcing partners. As we head into 2023, we may encounter several economic headwinds, but there will also be a push toward innovating and capitalizing on digital transformation initiatives.