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Why Outsourcing Software Development to an Onshore Provider is Better than Offshore or Nearshore

If you've ever considered outsourcing software development, you've no doubt wondered about the effectiveness and price considerations of sending your projects to an offshore or nearshore agency, weighing it against the pros and cons of an onshore provider.


A quick definition: An OFFSHORE provider is someone who is not in the United States or Canada, generally in Belarus or India. A NEARSHORE provider is usually near to the U.S. and Canada, generally in Mexico or Central America, or at least in the same time zone and hemisphere.


The problem with offshore software development is that they're basically a time and money sink. There are so many problems to overcome that people often point to the cheap prices as a way to make up for the problems. However, the delays, revisions, and endless fixes often add up to more than the same costs of using a local provider instead.


If you're not a large enterprise with billions of dollars of revenue where wasting hundreds of thousands of dollars equates to a rounding error that doesn’t matter that much, then offshoring may not be as good as on option as it seems on the surface. Large enterprises seem to make it work because the wasted dollars are buried inside massive budgets that aren't normally inspected under a microscope. Smaller companies need to mind their expenditures a little more closely, and they need to get things right the first time.


Issues Abound

Overseas software developers tend not to have the same level of skill and years of experience as your A-team developers in the United States. Yes, they have some skills, and you may even get lucky and find a very good team of software developers overseas, but they know they're good, and they're going to cost nearly as much as an onshore provider anyway.


The general rule of "you get what you pay for" applies all over the world to all walks of life. A developer who charges $5/hour is going to produce $5 work. A developer who charges $100/hour is going to deliver $100 work. The $5 developer will be cheaper in the beginning, but everything will take longer, there will be more problems, and they'll likely spend 10 to 20 times as long to get it right. If you had just paid the $100/hour developer the first time, you'd be time and money ahead.


Another hurdle with overseas development is the time zone difference. India is nine-and-a-half hours ahead of Eastern time (India has one time zone, 30 minutes off from all other time zones), which means when you're at work, they're usually at home, and vice versa. Communication is asynchronous, so you'll email your notes in the morning and you'll receive your response the following morning. One cycle of communication takes 24 hours. Conference calls are also difficult because someone will usually be on the phone when they should be at home doing non-work related things.


You also end up with a lot of churn and changes that wastes a lot of time: "I want this. No, I want this. No, I meant this." That kind of thing happens anyway, but now imagine that conversation being doubled and tripled in length.


Compare that to the convenience of making a phone call to someone in your time zone, and possibly even your city. Elegant Software Solutions is focused strictly on the greater Atlanta area, so we know the convenience of being able to pop over to a client's office for a face-to-face meeting.


Of course, nearshoring solves some of the time zone problems, but it still comes with other issues, such as language barriers. While most offshore and nearshore professionals speak more than one language, English is not their native language. Combine that with the fact that most Americans only speak one language, and if they speak more than one, it's probably not Hindi, Bengali, or Belarusian.


There are other communication challenges as well. Nothing can replace face-to-face communication as a way to reach the clearest understanding of each other's point of view. And very few things are as good as an in-person whiteboard session. We’re getting better at video conferencing these days, but anyone who has ever misread emotions in an email or Slack message can attest to the fact that meeting someone face-to-face is the most effective way to communicate.


Cultural and local contexts are also an important part of understanding one another. Even something simple like cookie versus biscuit, vacation versus holiday, to call versus to ring, and the letter 'Zee' versus 'Zed' abound. These are differences between American and British English, but since the Indian educational system has its roots in the British system, you'll find these same differences in the language.


And more important than all the communication and quality issues you're likely to experience, there’s the looming concern of protecting your intellectual property. It's not uncommon for an offshore software developer to take your code and sell it. A few years ago, a client of ours had hired an offshore software development company to build a "first-to-market" mobile app for them. Just as they were ready to launch, they found an identical app show up in that country's app store. The offshore developers stole their code, and at the time, prosecuting an international IP claim was beyond our client's financial means. IP lawsuits are expensive enough as it is, but once you add the international element to the equation, the costs of defending your intellectual property skyrocket.


Outsourcing software development shouldn't be a crapshoot. You want to work with someone who's located in your country, has a high level of skill, can easily communicate with you, and is covered under the same IP protection laws. That $5/hour software developer may seem like a bargain when you start, but it will end up costing you a lot more in the end.


To learn more about outsourcing your software development in the Atlanta area, visit the Elegant Software Solutions website or call us at (855) 449-4649.


Alpharetta, GA | meetus@essrocks.io | 855-449-4649