What Is Offshore Software Development?

Initially published 11th of June 2019 Updated 29th of December 2022

Building an in-house team of skilled developers can be tricky if your company is located where experienced developers come at a steep price. In practice, this means anywhere in Western Europe and the United States.

Companies that need help finding talent locally often outsource some of their IT services to another business. When doing that, they can choose from companies located in a different city, country, or even continent. Offshoring has become a viable alternative for companies looking for reliable tech skills that are readily available, even from the other side of the world.

Read this guide to offshore software development to see the advantages it brings to organizations and the best practices to help you make the most of it.

What is offshore software development?

The term refers to outsourcing software development tasks to another company.

Technically, it’s a form of cooperation where an organization outsources a software-based project to a third-party entity situated in a remote location, a place off the shores of the client’s residence. Just to give you an example: it can be a company in New York City delegating software development tasks to a business offering software development services in Poland.

At Sunscrapers, we have an excellent track of successful collaborations with businesses located as far as the United States.

Here’s an example:

We started our cooperation with the New York-based company 15Five with one programmer. Finally, we delivered an extensive team of five full-time programmers who helped the company achieve its goals with great results.

See more details about our cooperation with 15five and watch this video that shows how we approach offshoring:

Benefits of hiring an offshore software development company

Outsourcing software development to teams located far away brings companies many benefits:

• Access to top skills – by outsourcing IT to an external provider, you’ll get access to the knowledge and expertise provided by developers with plenty of experience in the field and who have worked on many projects – some of which may have been similar to yours. As a result, they’re aware of the common problems or issues, bringing tangible value to your company and positioning your project for success.

• Focus on core values – by outsourcing parts of your IT services that are less mission-critical, you’ll enable your team to concentrate on what matters most for your business growth: your core business values and functionalities of your software.

• Faster time to market – an external provider will help you accelerate your delivery speed while maintaining the quality you’re aiming for.

• Flexibility and scalability – external providers can quickly scale a development team up or down for you to match the changing needs of your needs. This is a key advantage of outsourcing over hiring in-house. The developers will become a fixed expense for your business, – while a remote team can be scaled or reduced when needed. You can reduce the development team once your app is ready; all you need is maintenance.

• Reduced cost of resources – an in-house team requires many resources as part of all outsourcing contracts: workspace supplies, laptops, and software licenses. If you hire a remote team, you won’t have to worry about any of that.

Find more details about the pros of outsourcing in this article: Benefits of outsourcing IT services

How offshore software development works

Outsourcing collaborations come in many shapes and sizes. For example, when teaming up with a software development agency located in a foreign country, you can:

• Delegate the entire project to the remote team,
• Delegate only certain parts or features of your project,
• Hire a dedicated team of developers,
• Hire developers who would become an extension of your in-house team.

Dedicated teams – note that the dedicated team model mentioned above isn’t geographically specific – instead, it focuses on issues such as control and ownership. The external provider will have complete control over the dedicated team during the project and take care of issues such as project management.

Extended teams – this model, on the other hand, relies on providing the missing software development expertise and skills to your in-house team. Developers supplied by the agency will become an integral part of your team, enabling you to maximize the potential of your in-house engineers.

How to manage offshore software development

At Sunscrapers, we have a lot of experience collaborating with offshore clients on software development projects. Over the years, we’ve learned that for offshore relationships to work, we must have well-defined and structured processes and practices.

Some things guarantee smooth outsourcing cooperation even if the offshore team is located in the most remote foreign countries.

Define your goals

Setting clear, actionable plans for the offshore team is critical to successfully delivering your software project. With well-defined objectives, developers might know precisely what they need to do and, as a result, feel supported and maintain their productivity. And all of that translates into higher project risk and fewer profits for your company.

Remember that remote software developers don’t have the insight and access to your business. You need to provide guidance and remember that even if these developers are experienced, they still need to know your core business values and how the project will help you reach them.

How to set objectives? Use the SMART system:

• S – Specific.

Be precise when describing your software project to the remote team.

• M – Measurable.

Your goal needs to be quantifiable or measurable. “Offer good customer support” isn’t a measurable goal. “Support 10 languages” is.

• A – Achievable or Agreed-Upon.

Your objective needs to be realistic, considering the resources that are available to you at the moment. Setting an unrealistic goal might seem inspiring, but it’s counterproductive because it sets an expectation that can’t be achieved.

• R – Relevant.

Set an objective that aligns with your business strategy and core values.

• T – Timely.

Set a deadline for your goal.

Pick the right team

Skills are essential when choosing the offshore team, but it’s not the only one.

In our experience, smaller teams of highly skilled software developers deliver better results than a large team. It’s easier to manage smaller teams, and communication is more streamlined, ensuring the project’s success.

Choosing a large and flashy software development agency might seem like a good idea. Still, they’re usually expensive and set in their ways – and flexibility is a key prerequisite to successful offshore collaborations. Smaller, highly-specialized companies are more flexible and eager to please clients by understanding their goals better and adding real value to the project.

Always check the references and portfolio. A reliable offshore software development company will be ready to pass you the contact data of previous or current clients. Choose a technology partner who can back up their claims with actual results of the software development services they have provided to other companies.

Communicate frequently

You need to have a regular communication routine with the remote team. Whether email, video conferencing tools, instant messaging apps, or phone calls, you need a team that can communicate with you quickly. Fluency in a shared language is critical here. And expert providers know that. We make sure all our developers are fluent in English with our demanding recruitment process.

Consider the time zone of your remote development team, as well. If team members are located on the other side of the world, software developers will likely be asleep when you’re awake. That's how time difference ends up causing severe communication issues – not to mention that it’s just plain inconvenient.

Eastern Europe has recently become one of the top destinations for offshore software development. And for a good reason! It offers excellent connections to countries in Western Europe, and the time difference is bearable when working with clients from the United States. Our location allows us to easily collaborate with companies from both the East and West Coast of the US.

Once your application development kicks off, make updates regular and productive. Updates allow you to quickly identify differences in expectations between your in-house and remote team before they become serious problems. Custom software development is a complex process that goes way beyond writing code.

You must prioritize asynchronous communication to make the process more transparent to team members. Here's how you can accomplish that:

• Communicate and document all your decisions. It's a mistake to consider offshore development as simple outsourcing of tasks. The software development team needs to understand the motivation behind your decisions to become fully engaged in the project.

• Create a vocabulary for your project. It will help you improve the clarity of communication and prevent any misunderstandings. The definition of done is a good starting point, but you should also agree on other terms such as 'user'.

• Organize regular short status meetings for the entire team - both offshore and in-house. That's how you can improve collaboration and coordination in offshore development.

• Keep the time for calls and meetings as consistent as possible.

A note about technology: Make using video-conferencing tools a habit for your teams. Seeing other team members is essential for communication, especially at the start of the project when teams meet each other for the first time. Video meetings are more engaging, interactive, and fruitful. It's the recipe for success in the early phases of offshore software development.

Collaborate

A remote development team still needs your guidance even if it works as a self-standing unit. If you think that ordering a perfect app and having it delivered a few weeks later is the reality of offshore development, you’re expecting way too much.

A good technology partner will know how to work independently in offshore software development. But if you want extraordinary results, you must fully engage in collaboration. Here’s how you can achieve that:

Assign a project manager

Your in-house and remote teams need to work in tandem, all the while overlooked by a project manager and product owner who knows how to manage teams. Being too hands-off is a mistake just as deadly as micromanagement. A project manager bridges the two teams, fostering communication and ensuring everyone is on the same page during the software development process.

Make the most of technology for collaboration

Starting with basics such as Google product suite and instant messaging apps like Slack, you need to build a collection of tools that enable collaboration in the most efficient and intuitive ways. Remote workers can’t just walk across the office to check in with their coworkers. You need to provide them with the next best thing – a digital equivalent of an open-space office. There’s plenty of software on the market that helps to achieve that.

Organize regular demos

A demo demonstrates the incremental result of the work carried out at the end of each iteration. The main goal here is to show what the offshore development team managed to achieve during the sprint. It also helps to understand how application development is proceeding and whether the team's performance meets the standard requirements. During a demo, the product owner or the project manager usually gives the team plenty of constructive feedback, ensuring that all of it is documented and readily available to the offshore team responsible for building the app.

When conducting software development offshore, you must use project management strategies that promote teamwork and collaboration. Outsourcing the development of your app to a remote team is much more than just delegating the task of writing code to another company. The success of your application relies on the quality of collaboration you achieve with your technology partner.

Engage

Remote teams do their best when engaged and invested in your project. Sure, it’s the provider’s job to ensure that their employees deliver the results you require. But you can get much more out of a remote team if you try these best practices for driving engagement.

Provide feedback

Recognize the input and success of the remote team. At the same time, hold the team accountable for problems and roadblocks they cause during the project. By regularly offering feedback, you’ll ensure they feel like they’re part of your team. That will, in turn, make them develop a sense of ownership of the project.

Organize regular status meetings

Drive engagement by having your teams meet via video regularly and seeing a teammate’s face results in greater engagement and mutual understanding. A weekly call will help keep everyone on track. And if you plan to follow an agile methodology like Scrum, daily stand-up meetings are a valuable ceremony in this context.

This quick 15-minute get-together helps to synchronize the work of development teams in different countries and time zones. The main objective of the standup meeting is to share the day's goals, set the agenda, and discuss any problems that may have arisen during application development.

Check also: 7 Agile best practices you should know

Make the remote team part of your company

Make an active effort to foster a good relationship with your remote team. Trust us; it’s worth it. Offshoring software development is riddled with challenges, and it's in your best interest to unite teams working in two different countries or even continents. Make sure to include them in company-wide status updates and calls when appropriate. Tell them about reached milestones and successes, especially the ones they’ve contributed to directly.

Build trust between teams

A distributed work environment doesn't help in team bonding. But there are some things you can do to make software development smoother. Agile development teams thrive in environments that promote autonomy and trust. If the offshore development team doesn't feel that it's contributing to the overall project's success, its potential is reduced. If you simply give the team requirements to write code, team members won't feel motivated or involved in the project. Treat the team like a partner, create a sense of purpose, and help them understand the business context. That's how you build trust between the software and your in-house teams, whether technical or business.

Hungry for knowledge? Check also: Successful remote team cooperation

Conclusion

We hope this article helps you choose the best outsourcing cooperation model for your business. Our experience taught us that offshore software development could boost businesses that are growing fast and need specific expertise on board as soon as possible. Gaining the support of skilled experts takes these companies to the next level.

Contact us

Are you looking for an offshore development team with outstanding expertise and experience in offshore collaborations?

Get in touch with us; we have an excellent track record of successful offshore cooperation with clients across different industries.

Read more

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

Articles mentioned in the post:

1. Outsourcing to Poland - Why and How?
2. Case study: Helping 15Five dominate the HR Tech space
3. Benefits of outsourcing IT services
4. Unpacking the dedicated team model + 3 best practices from our team
5. The extended team model: here's how to make it work
6. 7 Agile best practices you should know
7. Agile development teams
8. Successful remote team cooperation