The purpose of an offshore development partner is to guide you through the process of going offshore in the most efficient way possible. And that’s why, it’s important to partner with a company that has years of experience building successful offshore teams.
Unfortunately, while plenty of businesses call themselves “offshore development specialists,” or others offer “offshore outsourcing“, some of them are far from it. Let’s take a look at how to verify an offshore partner early on — checking they’re genuinely reliable and competent, before you’re in too deep.
First thing: are you sure it’s offshoring?
While often used interchangeably, offshoring and outsourcing are two very different models.
- Offshoring – Building a dedicated software development team (complete with office space, administration, and management) in another country. There are many benefits of offshoring, most notably cost and access to a massive talent pool. You own the team entirely and they’re fully integrated into your business but the administration is managed by your offshore development partner.
- Outsourcing – Hiring contractors to temporarily cover a lack of capacity. These are more like freelancers — called in when required, but independent from your organisation.
How do you verify a potential offshore development partner?
1. Evaluate their demonstrated experience
It’s 2020 and there’s no excuse for not having some portfolio pieces or case studies on your website. These can offer a perceptive window into what your offshoring partner can do, and how well they do it.
Your offshore development partner should be able to showcase their successful history of building offshore development teams. The details — approach to projects or relationships, timelines, and results achieved are the most important parameters. But also the delivery — do they sound professional and confident, arrogant and showy, or maybe lazy and uninterested? A company’s writing usually matches the personality behind it.
Keep an eye out for vagaries — the right offshore partner will really know their stuff. Rambling language, vague descriptions, and very broad claims should all be red flags!
You can also go the extra mile, if you’re willing. Are the past clients of your potential offshore development partner still in business? Any evidence of significant growth or positive changes? In the UK, for example, you could review their accounts filing history on Companies House. By doing this early research, you can begin to see if they’re a good fit for you and your business.
2. Assess cost-effectiveness
One significant benefit of offshoring is lower costs. However, while price is important, it’s usually a mistake to simply snap up the cheapest offer.
So how do you guarantee you’re getting your money’s worth?
The cost of living in countries like India is significantly lower than in the US and Western Europe. That means you’re going to get a good price compared to hiring locally.
On average, running your software development centre might cost 50% of what you’d pay at home – and that includes your taxes, utilities, administration, and everything else required to manage the team. That’s an enormous saving.
But an outsourcing company might make you an offer for just 10% of the at-home cost. Despite the enormous price appeal, your enthusiasm should be tempered. Can they actually deliver what you want?
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Whoever you approach, get specific about the costs. Enquire about quotes, timelines, and future costs. Do you have to pay before they build your team, or after? Is there a standard cost-breakdown you can read to see how things usually work?
As for progress, it’s the same strategy — ask questions and demand straightforward answers. What’s their recruitment strategy of your offshore development partner? Which companies have they served in the past? Does the management have technical leadership experience?
You want someone who knows how to recruit top-class talent into your business. If the price is staggeringly low, be diligent. However, remember that the price should be low – it’s just a matter of finding the right balance.
3. Evaluate their approach to communication
When working with an offshore development partner based 10,000 miles away, communication is key.
DID YOU KNOW?1 in 5 projects fail due to ineffective communication.
Evaluate communication before signing a contract. When discussing your requirements, does the company sound confident enough? Are they asking you the right questions?
During your early communications, are responses to emails and calls fast? Are they polite? While it isn’t much to go on, any communication red flags at this early stage should be taken seriously.
4. Bridging the culture gap
Building an offshore development team means working with people from different cultures. Though cross-cultural teams are becoming commonplace, establishing smooth relationships between new colleagues can always be challenging.
At The Scalers, our top-level executives include Europeans who have lived in India for years. They act as the perfect bridge between the Western and Indian team members. This means that during the recruitment of software engineers, extra care is taken to bridge the culture gap.
When talking with potential offshore development partners, discussions over cultural differences should be held openly. Any reticence on that subject should give you pause.
Of course, there’s more to partnering with an offshore company than these four points. We haven’t even looked at crucial areas like recruitment or technical competence – but we don’t need to. This article is all about those first encounters. If it’s a green tick on all 4 of these points, we encourage you to carry on the conversation and get into the details!
If you’re interested in how we build our clients’ offshore teams, you can read our case studies, send us an email, or even schedule a chat with one of our executives. We look forward to hearing from you!
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