What are the Pros & Cons of IT nearshore?

IT nearshore company office.

IT Nearshore is the practice of moving a company’s activities, processes, or services to another country on the same continent and in a similar time zone. So, a company in the United States may move operations to Mexico or Panama, while a British firm might consider Poland, Ukraine or Portugal as possible destinations for some of these nearshoring services.

With a more diversified workforce, lower prices, more consistent customer service, simpler transportation, and shorter training durations due to cultural and linguistic affinities, all of these advantages benefit the organization’s bottom line.

How does nearshore differ from offshore and onshore software development?

Employing or contracting services in countries that are geographically far from one’s own is called “offshoring.” On the other hand, an “onshore” outsourcing strategy can be used to outsource some of a company’s work to third parties but in the same location. Several advantages of this approach are readily apparent: both customers and the recruited staff share the same language, culture, and time zone.

However, this technique does not maximize the return on investment for certain activities because the costs involved are commonly high when comparable. In industrialized nations, professional developers’ prices tend to be rather high for outsourcing services.

In a nutshell, outsourcing your work to companies in other nations is known as offshoring or nearshoring. You may save money while simultaneously boosting the quality of your work by implementing this method. Low hourly pay and an abundance of highly trained labour are commonplace in countries like Ukraine, Poland, Bulgaria and Portugal. This helps consumers to save money while still having access to the best IT experts in the industry (developers, engineers, data scientists and designers). This can be a chance for collaboration even if time zone differences are cumbersome. While a large time difference may cause problems with process coordination, it may also be employed to allow for 24-hour activities to take place.

The term “nearshore outsourcing” is defined further down this page. As a result, this technique focuses a great deal of attention on discovering people in the near vicinity. There are several advantages of outsourcing to nearshoring, including lower costs, cultural similarity and shorter lead times.

That’s one of the perks of working in the digital era and in the IT industry. No need to have an in-house staff if you don’t want one. Instead, you might look for the best-specialized workers in both neighbouring and faraway outsourcing countries to find the best deals.

Best nearshore locations in Europe and why

Europe has become a hub of nearshore software development and many countries prefer Eastern Europe because of many reasons. Europe has some best nearshore places that are on the top of the preferences when choosing a supplier for creating remote software teams. Such locations include:

  • Poland 
  • Portugal 
  • Czech Republic
  • Ukraine 
  • Belarus
  • Romania 

These are the best nearshore location in Europe as they allow working with such reimbursement with average hourly rates for developers ranging from 27$ to 55$.

·  The main reason comes with using the same and common language. The European engineers in the locations above are proficient in English which makes it easier to communicate and understand the demands.

·  As a result of tax benefits, IT nearshoring to Europe can be an appealing alternative for certain businesses trying to save costs.

·  Another reason for these countries to become the primary source of IT nearshore development is their low living cost which allows some IT nearshore companies to carry out their businesses and attract talent.

·  These locations include some highly professional and skilled IT nearshore specialists.

· Additionally, working with these locations brings the flexibility of time. The workers can collaborate easily due to the similarity in time zone.

Why is distributed and remote nearshore proving best?

Having nearshore services distributed through some of the countries above gives you the advantage of widening the talent acquisition and taking advantage of each one of the locations’ pros.

Portugal worked a lot on the technology space by introducing about fifteen polytech public institutions and about one hundred and fifteen institutions in the private sector. Moreover, about thirty-two per cent of the Portuguese population speaks English, but it goes on to increase in the professional environment.

Ukraine is known for the lowest prices for certain software engineering positions in Europe. On the other hand, the Polish workforce is one of the most hard-working and resilient in the world. Wouldn’t it be great if you could have it all in one team?

Lisbon nearshore

For centuries, Lisbon has played an important role in the development of the navigational, strategic, and logistical competence that is essential to missions, and it continues to do so. Portugal’s IT scene may be found in Lisbon, the capital of the country. The combination of internal and external investment, start-up boom, attention from big-name organizations, relocation from the web summit, and media attention has resulted in a considerable income gain and generalized buzz.

Only a few cities in Portugal are capable of attracting skilled employees. As a result, Lisbon’s population is increasingly ethnically varied. Anyone seeking outsourced solutions would find it a good fit here.

How do IT nearshore benefits?

1. Effectiveness in terms of costs. While offshoring may be cheaper in countries like India or Pakistan, nearshore software development might be a better return on investment when considering risk and cultural disparities.

2. In most cases, the cultures of the nations nearshoring in Europe are very similar. It is easier for teams to work together if they speak the same language, have similar values and have identical professional cultures. Better goods and services can be produced as a consequence of a faster exchange of information and more successful interactions than outsourcing offshore with multiple cultural differences and miscommunication.

What are the drawbacks of IT nearshore development?

There are some drawbacks that should be considered.

Communication being a hurdle

In nearshore outsourcing one of the problems that could arise is communication, which is not often the case. But facing a language barrier or bad channels can result in poor communication and misunderstandings can happen that can affect the quality of work. 

Asynchronous work

It happens to be problematic for two teams to be working on a thing but a distance of miles. It causes problems for the teams working from different locations to complete their tasks effectively. For instance, two people work for software development but in situations where instant troubleshooting and response are required. There would not be such assistance to create a useful effective software product.

To prevent those disadvantages, experience is key. If you are not experienced in building nearshore distributed teams, talk with peers that have been doing it for some time. Software development agencies will be able to advise you on the best communication channels, processes and monitoring tools.

Conclusion  

Nearshore software development provides many benefits and results in effective outsourcing of software development. Getting assistance near the location makes it easier for teams to communicate and work according to the demands. This provides lower operating costs and high-quality delivery. Nearshore software development either distributed or in a single location should be considered if you are planning to develop digital products.