How to choose the right offshore software development company

How to choose the right offshore software development company

As companies strive to remain competitive in the technological rat race, the offshore software development industry has gained considerable momentum. Offshoring allows global  companies to access talented engineers in emerging nations like India.

Many companies want to offshore to reduce costs, but managing offshore teams can be tricky: you need a reliable partner. If you hire a team in another country, you’ll only see them live once or twice a year. Managing these employees and ensuring they deliver outstanding work can be challenging.

But it doesn’t have to be! An offshore software development company can help. Hiring offshore developers can be a complete game-changer for your business when you find the right offshore development company.

An offshore development partner’s role is to build the right offshore team for you based on your requirements and to handle the administration and HR while you manage direct collaboration with your engineers and focus on the business. As a result, you get a close-knit team of exceptional developers who are an extension of your team.

What is an offshore software development company?

An offshore software development company helps organisations in moving technology operations overseas. How? By building world-class dedicated engineering teams.

Businesses with the right offshore partner work with top developers who are more skilled and innovative than their domestic counterparts while enjoying lower hiring and operational costs.

For example, a UK-based firm that can’t find the right tech talent locally can form a top development team in India with all the benefits of a cost-effective offshore model.

A reliable offshore software development company doesn’t only hire and onboard talented developers but also takes care of all the legal and administrative tasks, as well as infrastructure management, and HR processes, including keeping your engineers engaged after they’re hired.

The state of software development

4 factors to consider when deciding on an offshore software development company

When selecting an offshore partner, consider these four crucial factors that every company should offer:

A large tech talent pool

The number one reason for companies to offshore software development is the lack of top tech talent in their region. If you’re a tech leader in a  US, European or Australia-based organisation, you know the struggle.

Western countries are suffering from an unprecedented tech talent scarcity, with businesses unable to find local candidates with the right skill set. As a result, more companies are looking to collaborate with offshore partners with access to large pools of top-notch professionals worldwide.

When deciding on an offshore software development company, evaluate the company’s talent pool and the country they are sourcing their talent from.

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Indian tech industry has a talent pool of 3.8M world-class professionals (FY 2021)

Seamless flexibility and scalability

Teaming up with an offshore software development company means building a lasting partnership. While short-term goals are important, it’s crucial to prioritise the future, especially when integrating a dedicated full-time development team that you can scale up whenever needed.

Since offshore contracts usually span years, your partner must comprehend your immediate and future business requirements — in two, five, or even ten years.

Make sure your partner offers flexibility and adaptability as standards.

Robust data security

If you read (almost) any list of the pros and cons of offshoring, you’ll see tech leaders are concerned about privacy and security when going offshore. It’s understandable. When you work with an offshore partner, you trust a team thousands of kilometres away with sensitive data.

That’s why you must ensure your offshore partner complies with the latest policies and procedures to manage organisations’ sensitive data. For instance, a company accredited with the ISO/IEC 27001 certification demonstrates a robust information security management system that follows global best practices.

Rigorous quality assurance

Partnering with an offshore software development company prioritising quality assurance means having an engineering team that can effectively solve communication challenges and technical issues.

But what does this really mean? It involves setting up efficient procedures together for monitoring and resolving bugs and scheduling regular detailed performance reports. Ultimately, this ensures a smoother development process, quicker issue resolution, and higher-quality software delivery.

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Understanding Offshore Development

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4 steps to help you choose the best offshore development company

Begin by defining what you want

Ensure you know what you want to gain from hiring an offshore development partner. Write a proposal that outlines your specific goals and metrics, the types of projects you want to offshore, the skills and requirements you need and the size of your desired team. 

Preparation is crucial for dealing with offshore software development companies. With a clear understanding of your expectations regarding team size, skill level, and other vital details, you can communicate your needs to offshoring companies.

What your offshore partner handles for you

Ensure they demonstrate experience

It would help if you chose an offshore vendor with experience building world-class development teams for your business. You need a company with proven expertise in offshore software development.

You want to partner with a company that can demonstrate its success as a remote offshore team. A strong portfolio is vital, but references from colleagues or acquaintances are helpful. At the very least, you should expect detailed case studies demonstrating their problem-solving ability. If they’re legitimate, you can move forward.

Investigate management capabilities and cultural fit

Peter Drucker once said management is doing the right thing. Only a few offshore software development companies do what they say. Don’t partner with a company that is flying by the seat of its pants. Your company might have a great vision, but clumsy execution can hamstring it. Given the logistical challenges (time zones, distance), a strong management team is needed.

You can trust your partner to manage the administration tasks diligently. For evidence of their experience delivering effective offshore teams, ask what makes their management capability robust and reliable.

For example, to ensure cultural compatibility, a European software company could leverage Indian engineering talent. The long-existing links between the two and the influence of global corporations have created a perfect talent hot spot.

Evaluate cost-effectiveness, not cost

Access to the most qualified talent at the most affordable price should be a significant factor in choosing to offshore your software development. Because the cost of living is lower in popular offshoring destinations like India, every offshoring partner will offer you lower rates than the equivalent back home in Western Europe, Australia or the US.

Remember, assessing value is critical. For example, company X might charge 50% more than company Y but deliver 3x better results — more cost, but higher return.

Results from case studies can be a reliable barometer of value. Nevertheless, you should also evaluate the management team and staff — do you feel confident allowing them to help build your business?

Discuss the costs in detail. Inquire about quotes, timelines, and how unforeseen costs are handled. Is it a fixed fee or a variable fee? A reliable partner will have all the answers.

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Questions to ask an offshore development company before choosing them

Building a close-knit team of skilled developers can help add value to your team. 

Nevertheless, before partnering with an offshore development partner, it’s essential to consider what you’d ask your partner before signing the deal. Below, you will find the essential questions to ask:

How will they identify your needs?

If you are considering offshoring, you must make sure that the offshore software company understands your goals.

What are your specific goals, metrics, and growth targets? What are you working on now? Are they aware of your current business needs?

Offshore partners should research your business before meeting you. Discuss the finer details, like the size of the team and the skills you need. In the next step, the company will draft a proposal.

They are probably not the right fit if they cannot identify your business needs.

What are their rates, and how do they charge?

The right offshore development partner must be affordable but of high quality. In countries like India, the cost of living is lower, so two out of three offshoring partners will offer you a lower rate than at home.

Assessing which provides the highest value is key. Is your return higher if you pay more? Once you’re confident about the pricing, it’s time to get specific about the costs.

Ask about quotes, timelines, and unforeseen costs during the project. Is the monthly fee that you’ll be paying fixed or variable? What expenses does the fee cover? Are there any hidden costs?

The right partner will be able to put your mind at ease and give you all the answers without any hesitation.

Global software development rates

How does their recruitment process work?

You probably want to go offshore because of the acute shortage of talent. So, you need to make sure the offshore development company you pick can guarantee access to the best talent.

Ask them about their recruitment process if you meet a potential offshore partner. How do they source candidates? How are candidates filtered out? Which criteria do they use? Do they value cultural compatibility?

You can even ask them for a portfolio of the teams they’ve built over the years. If the company can’t demonstrate its success in building offshore teams, it’s wise to walk away.

You can determine what engineer you can expect to work with by answering these questions. You can also analyse their problem-solving abilities, dedication, and punctuality through this exercise.

A meticulous hiring process increases the chances of hiring the most qualified tech talent in the industry — and that’s just what you need.

How long does it take to build a team?

Developers’ availability, the project’s complexity, and the required technical expertise all influence how long it takes to build a team. An experienced offshore partner can still give you a rough estimate.

The right offshore development company knows the industry, can quickly analyse project complexities and knows where to source developers. Alternatively, if the company is uncertain about timelines, it won’t deliver on time. Your business could suffer a significant capital loss.

Considering that you’re 10,000 miles away, your offshore development partner is your trusted advisor. That means that they need to be able to handle all the administrative and legal activities for you.

They take care of the recruitment process, set up workstations and onboarding, and issue weekly/bi-monthly updates about your team.

So, during your meeting with an offshore software development company, it’s probably time to look elsewhere if they cannot offer you all this and more.

In the initial meeting, offshore software development companies must discuss these questions. You can find more tips and tricks in our blog, Offshore Software Development: The Definitive Guide For CTOs.

Why choose The Scalers as your offshore software development company?

Establishing your offshore team isn’t as intimidating as it might seem. At The Scalers, we have a proven record of walking companies through the process, from initial requirements to setting up a dedicated offshore development team with our proven expertise.

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Working with our developers has been an absolute pleasure from day one. They have seamlessly integrated into our team, bringing with them a wealth of expertise and insight that has helped us to achieve our goals more efficiently and effectively. 
Asif Ali
Head of Software Development, PLT

Led by European and Indian leadership, we’ve created a model that rapidly scales engineering teams. This is what we do for you:

  • Sourcing Bangalore’s top tech talent.
  • Picking the top 1% of skilled Indian developers.
  • Building dedicated teams for lasting partnerships.
  • Handling all on-site operations.
  • Promoting a people-centric culture.

Want to learn more? Feel free to reach out to us by filling out the contact form at the end of the page or by contacting us here. We’ll get back to you within the next 24 hours.

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In summary

Choosing the right offshore partner is a defining moment for your business. As a tech leader, you’ll want to work with a company that offers the best talent available and flexible collaboration models that align with your goals.

This way, you’ll be able to harness global talent, maximise cost-effectiveness, and achieve success.

Offshore software development empowers businesses to tap into talent from emerging nations like India, driving cost efficiency and competitiveness.
The right offshore software development company offers a large talent pool, seamless flexibility and scalability, robust data security, and rigorous quality assurance.
The five steps to choosing an offshore partner are: defining goals, understanding offshoring, checking partner experience, assessing partner management capability, and evaluating cost-effectiveness.
Tech leaders should ask their offshore partners about their rates, recruitment process, team development timeline, and administrative support.

So there you have it: the offshore roadmap to decide on the perfect partner is yours for the taking.

See you on the next one, and good luck building your offshore development team!