The IT outsourcing industry has recently grown in popularity – due to the impact of COVID-19. The global IT spending is expected to hit $1.3 trillion in 2022, up 7.9% from last year. The pandemic has also led to an increase in IT outsourcing. According to statistics, the global IT outsourcing market is projected to be valued at $413.7 billion in 2022.
Outsourcing is a strategy for companies across multiple industries to leverage a partner’s expertise to streamline their processes and enable them to focus on the core aspects of the business.
Working with an offshore software development team can help startups create a high-quality product, save time and money.
According to a survey conducted by Deloitte in 2020, 70% of organizations choose to outsource for financial reasons. Although cost reduction is a main reason, other factors can drive the client’s decisions, such as agility, access to tools and processes, speed to market and flexibility. This explains why most companies are now opting for offshore software outsourcing.
Outsourcing brings a lot of benefits, but managing international teams can involve a set of specific challenges like differences across cultures, languages, skill levels, time zones and more.
In this article, we will provide you with tips on how to manage an offshore software development team effectively and the experience surrounding this type of IT outsourcing.
What Is an Offshore Team? Pros And Cons
An offshore team means a team of experts located in a different country and they work for you remotely. These people can be found anywhere, and both parties communicate via email, video conferencing, phone conversations, etc.
Many companies today rely on remote teams, leveraging global talent to gain competitive advantage. Offshore outsourcing offers great benefits, but there are some challenges companies may face.
Some of the most common advantages of offshore outsourcing are:
Fast onboarding. Outsourcing streamlines your tech recruitment process. When working with offshore vendors, you don’t need to invest in employee recruiting and training. The process is much faster and easier than you handle on your own.
Access to skilled resources. Offshoring allows your company to take advantage of a wider talent pool to complete the project efficiently. These offshore employees often have brilliant education, vast experience and excellent skills.
Lower costs. As mentioned earlier, one big advantage of offshore outsourcing is reduced costs. For instance, a reliable and experienced offshore software development company like EXE Corp will provide you with top-rated talents at a reasonable cost. The company is located in Vietnam, where the average hourly wage is much lower than in other countries in Asia, Europe, Australia, North America and South America. This, therefore, helps you save a large amount of money on your projects.
Quick scalability. As your company grows, you’ll need to expand your teams. It can take plenty of time if you handle everything on your own. But with the help of an offshore vendor, you can scale quickly and easily.
Working with overseas development teams comes with many challenges, including:
Time zone difference. One common challenge when working with an offshore team is different time zones. But companies can easily overcome this hurdle by using virtual tools (email, chat tools, video conferencing) for effective communications.
Delivery delays. This issue occurs when members in the team do not work harmoniously towards a common goal. The solution is to use management software or agile technology.
Privacy and security. Working with an offshore team can put your company at risk of data leaks and cyber breaches. To avoid this problem, you need to choose the right outsourcing partner and make sure they sign a non-disclosure agreement.
Steps to Manage an Offshore Software Development Team Effectively
Offshore outsourcing can come with its own set of benefits and challenges. Here are a few tips to manage the offshore team effectively and overcome its challenges.
Seven tips for effective offshore management
1. Hire the right candidates
Choosing an ideal offshore development team should depend on your company’s needs, requirements, product and technical infrastructure. Check out if the talents have the required skills and experiences for your industry or not.
2. Communicate goals and priorities to the offshore team
By sharing your project’s vision and goals with the offshore team, you can guide them towards success. Set clear and proper expectations from the start for the team, and let them know how you want the results to look like.
3. Ensure clear communication
When working with the virtual offshore team, you can’t closely monitor the progress of the project. Thus, it’s important to leverage the use of Slack, Skype or Zoom to facilitate effective communication. Keep track of the team’s everyday activities and progress. And make adjustments to the tasks if anything unexpected arises.
4. Enhance working conditions
No matter you’re outsourcing or hiring in-house employees, workplace conditions and environment have a direct impact on your staff’s productivity, performance and more. A lot of studies show that the number of reasons why employees quit their jobs is due to poor working conditions. Therefore, one tip on how to manage an offshore software development team effectively is to improve the working environment. For example: great culture, healthcare and wellness practices, modern workspaces, strategic location.
5. Allow the team time for training
An offshore team with talented developers also needs training to learn about your company’s products, policies, procedures and technologies. Training enables the team to understand the goals and expectations of the project. Therefore, one management tip is that you commit to training, reviewing and assisting the offshore team to make it a success.
6. Get to know the team members
It’s highly important to know, communicate and understand every member of your offshore team. This, in return, can help you overcome challenges of different time zones, culture and language. Make sure the offshore team is being led by a reliable person. Regularly visit the offshore location to strengthen the relationship. Maintain quick and effective communication to make your oversea team feel that you’re not too far from them.
7. Apply agile principles to daily work
Another tip on how to manage an offshore software development team effectively is to use agile technique. This technique is one type of project management processes, already used worldwide for software development. The aim of agile methods is to help development teams deliver results that meet the needs and expectations of the client company more quickly. Agile focuses on teams and collaboration, which makes it different from other methodologies.
How to maximize the offshore team productivity
Collaboration is the key to success in offshore development management. The project will collapse if the collaboration between teams fails. For effective offshore team collaboration, several tools are here to help. For example: email, chat tools (Zoom, Slack, Google Meet, Skype) and project management tools (Asana, Trello, Jira).
How can EXE Corp be your partner in success?
EXE is an IT service provider located in Vietnam, specialized in providing IT staffing, IT solution and software development. Over the past decade, the company has become a reliable IT partner for a number of business owners and brands across multiple industries. EXE Corp assisted Liberty Insurance, Air Timor, VietJet Air, KMS Solution, X72, Siemens, VNITO Alliance to meet their digital ambitions.
EXE offers a wide range of software development services such as web design, mobile app development, system building and digital transformation consulting. The company adopts the latest technology to maximize the client company’s operational efficiency and exceed their business goals. If you’re interested in any service like software development, IT staffing and DX consulting, EXE Corp is the perfect choice for you.