What Is Nearshore Software Development?

Intro

The development of information technology is one of the strongest drivers of the globalized world economy. For business, borders disappear, and shortages in the local labor market can be compensated by reaching out to specialists available in other parts of the country, sometimes even the world.

For professionals, likewise - the huge demand for specialized knowledge and skills opens up a wide range of opportunities to network with employers worldwide. However, in addition to the bright sides and apparent benefits of this state of affairs, there are also areas of risk and, consequently, more or less justified concerns.

Doesn't hiring specialists located outside the company, or even working remotely from a completely different country, take away control of the team and the company's processes? Let’s answer this question by taking a closer look at nearshore software development.

What is nearshoring?

Nearshoring is outsourcing software development services to countries close to a given company, guaranteeing coherence in terms of culture, time zone, and the possibility of flexible cooperation.

For companies from the United States, a popular destination for nearshoring is Mexico, while Eastern European countries are becoming increasingly popular in Western Europe.

Nearshoring allows control over a project and can facilitate cooperation between a company, an outsourcer, and an outsourcing partner doing the work. It maximizes business efficiency and reduces the barriers inherent in outsourcing collaboration. It's a highly beneficial solution that is most readily used by decision-makers and CEOs of smaller and medium-sized companies that have already passed the startup development phase and further want to use outsourcing services but reduce the distance between them and the contractors they hire.

When is it worth using nearshore software development?

The nearshoring service is used by companies in various industries requiring programmers and other IT specialists.

Although any enterprise can achieve its goals thanks to nearshoring, this solution is especially recommended for businesses that:

• Want to minimize costs. Nearshoring means the possibility of reducing the cost of project implementation. Depending on the size of the implemented project, savings can be counted even in the hundreds of thousands of euros.

• Are implementing a project under time pressure and cannot afford to create or expand an IT team. With nearshoring services, the team is gathered more quickly, and by including specialists, the project can be completed on schedule.

• Have an IT team, but its capacity is insufficient to complete the project. Then recruiting to strengthen the IT department for a few weeks or months misses the point - it is financially unviable.

Is nearshoring a solution for every company? Delegating part of the tasks to the outside requires the company to develop appropriate procedures. We are talking, for example, about the need for constant monitoring of the quality of work performed by the external team. However, as seen from the example of global trends, nearshoring does work.

Benefits of nearshore software development

More and more companies appreciate the possibility of using external IT specialists. In cooperation with foreign programmers or IT consultants, they see both an opportunity to optimize costs and increase competitiveness. However, these are not all the benefits to be pointed out.

Nearshoring also allows for

• Collaborating with various IT specialists. Nearshoring service provides access to experts from different IT departments. In doing so, you don't have to hire them permanently to benefit from their expertise. This, in turn, translates into substantial financial savings.

• Time savings. It refers to the lack of need to organize recruitment and to relieve the company's IT team of some tasks.

Potential outsourcing partner has much more experience recruiting and selecting the best talents for the projects. You, as a Client, do not need to use your resources because the outsourcing company knows the market and can take of everything quickly and efficiently. Sometimes these companies have the right specialists ready to take over a new project without all the recruitment process stages. Thanks to this, the outsourced team can start working on the project (almost) immediately.

Using the services of an outsourcing company can also save a lot of time when it comes to formalities and administration. All the tasks related to work agreements and taking care of the people and their well-being are usually on the partner’s side.

• Quick project completion. Access to experts makes a difference in how the work will proceed and whether it will be completed according to a predetermined schedule. If so, the company has a chance to quickly bring a new product to market or maintain the competitive edge it has built.

• Not worrying about the distance. If necessary, it is possible to arrange a face to face meeting with the acquired specialists at short notice.

How to make the nearshore software development work?

Remote work

What is especially important in the current situation, the IT industry has the technical facilities and procedures to work 100% remotely. As a result, software development services can be provided from anywhere in the world. The key to the success of IT companies is years of experience and developed best practices, as well as proper technical and organizational preparation:

• IT infrastructure and a configured VPN
• Remote working tools to facilitate online collaboration (i.e., Teams, Zoom, Google Meet)
• Hardware and tools to facilitate administration
• The right organizational culture

Language

What does remote execution of projects in the nearshore model look like in practice? The British, who have been reaping the benefits of nearshoring for years, can probably say a lot about it. For obvious reasons, they choose regions where English is popular among potential employees. Not surprisingly, the choice often falls on Poland, which ranks high in the EF English Proficiency Index report year after year.

Organization and planning

The success of the cooperation lies in openness on both the client's and developers' side. Other success factors for proper organization and planning are:

• First face-to-face meetings and the several-day knowledge transfer workshop.

• The use of the Scrum methodology in running a project, with high involvement of a client in the activities performed.

• Flexibility of two-week Sprints in a project.

• Daily stand-ups, i.e., 15-minute online meetings to discuss the most important issues of the coming day.

• Planning poker - a game that involves developers in decisions. Seeing the great knowledge of team members, a client places a high value on listening to their ideas and suggestions. Decisions are made jointly by software owners and IT specialists, which gives both parties a sense of shared responsibility for the project.

• Creating a strong relationship between a team and a client, both parties. A client treats a team as an integral part of the company. Programmers, on the other hand, have a sense of great influence on the project, which increases their motivation.

Nearshore software development in Poland - is it worth a try?

One of the increasingly popular nearshore software development destinations in Europe is Poland. The role of this country on the map of outsourcing services is growing stronger and stronger. Admittedly, the prices offered by the Polish IT market are no longer as low as they were a few years ago (although they still arouse enthusiasm among foreign clients). Still, local specialists' sheer knowledge and skills definitely make Poland stand out on the international stage.

Poland has some of the best programmers in the world, ranking 11th on the list of the 50 most digitized nations in the world and 13th in Europe in terms of English proficiency (thus ranking well above the European average).

With a population of nearly 38 million and a number of world-renowned technical universities, we have access to many skilled IT talents. All this makes Poland the most popular outsourcing destination across all European countries, according to the ATKearney Global Services Location Index. Our market has already been recognized by companies such as Accenture, Credit Suisse, Goldman Sachs, Zurich Insurance, and Cathay Pacific Airways. However, this is not the end of the story. In the area of outsourcing, we haven't said the last word yet, so the development of this sphere in Poland will undoubtedly mark the next few years.

Contact us at hello@sunscrapers.com if you’d like to discuss the possibilities of outsourcing software development services.

We’ll be happy to talk!

Read more

1. What is offshore software development?
2. Offshore software development: Our recipe for success in New York City
3. Hiring Developers - Offshore vs. Nearshore Software Development