Moving some of the business operations overseas is smart, considering that an average salary for a software developer in the US is $106.5k a year while in France, for example, it is only $40.5k. No wonder that such tech giants as Cisco or IBM have also transferred some of their services from California and New York in the USA to the more affordable countries like Ukraine or India. The possibilities of acquiring talents offshore are tremendous: from the good-old outsourcing to the full acquisition of an overseas company or establishment of an offshore IT services center under the same corporate roof. The latter becomes more and more popular in 2020 due to the multiple benefits this model of expansion has to offer. Read on what an offshore development center is, and why the BOT model became the top solution for both enterprise and small business enlargement plans.
An Offshore Development Centre (ODC) is a subsidiary of a company that is located offshore, i.e. in another country. Most often, an ODC is set up when the offshore country has greater talent, lower operational and living costs, and can provide the same level of service to the mother company.
Is ODC the same as outsourcing?
Do not mix up outsourcing and an offshore development center. When it comes to offshore IT outsourcing services, this means that the services are obtained from a third party, and the type of cooperation here is B2B. In this case, specific contracts need to be set up in order to have ownership rights for the software developed by such a team. The offshore IT solutions indicate that the team operates in a different country, yet it is a part of the initial business and abides by the same contracts and agreements of the mother-company. A classy example of an offshore service is when a US-based manufacturer opens a factory in China to cut the costs.
There are several types of offshore development centers a business can opt for. The top three are:
A field project: business representatives travel to an offshore country and set up an offshore development company from scratch.
Acquisition: business purchases an existing company in a different country, making it a part of the current processes.
BOT: business hires a middleman offshore who sets up the offshore development team, then runs it, and in the end hands over to make it a part of the initial company.
While each option has its ups and downs, it is the build-operate-transfer (BOT) model that bears the lowest investment and operational risks. It requires the minimum involvement from the core company, and can happen in the tightest timeframe.
Before we get to the reasons why the build-operate-transfer model is among the top offshore IT solutions existing today, it is worth defining its operational processes:
Build: A local company at the offshore location is hired to analyze the original business structure and needs, then to set up all the infrastructure and the target location, recruit the employees, organize all the cooperation processes, plan the knowledge transfer, etc. This middleman team sets the ground for the upcoming offshore software development the original company is looking for.
Operate: The local company manages all the offshore IT services and processes, arranges the workspace, deals with the local regulations, plans company events, organizes development training, tracks all the processes in the offshore team. At this stage, this company is also working towards optimizing and unifying offshore operations to the mother-company rules, regulations, and systems. At the end of the ‘operate’ stage, a completely functional and independent team is set up with all the legal and daily routines.
Transfer: Once the team matures enough to join the original ecosystem, the middleman plans for the transition of this team from its control to the full supervision of the mother-company, its managers, and additional regulations. After all the preparations, the vendor transfers all the paperwork to the original company and withdraws from the process completely.
The important note here is that BOT may go without the ‘transfer’ part. Many companies remain satisfied with the operational and procedural services offered by their vendors, so they leave the supervision and control of such an offshore development company in the vendor’s hands.
Easiness of setting-up, managing, and acquiring the offshore IT services within the BOT is an obvious top benefit this model can bring. That is also the top reason why businesses in all industries all over the world look for offshore development company services to help with the transition. Yet, there is much more than the free hands to the BOT!
An offshore development center is a perfect way to find new talents, expand your business, and boost your productivity. Among all models existing today, the build-operate-transfer is one of the most beneficial possibilities to set up an offshore development team and begin boosting your ROI in the shortest timeframe possible. This strategy helps with collecting the best local minds with the least managerial and cost effort involved. The help of an offshore vendor also allows for easy risk management and provides a high level of data and processes security if compared to the outsourcing model.
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With the rise of globalization and the worldwide lockdown due to the pandemic, most of the work has been done by remote working processes and professionals from their homes. This lockdown has proved the efficiency of remote development and enhanced the trust in offshore software development industry.
To make the most out of the benefits of offshore software development, you should understand the crucial factors that affect offshore development. This is why you should read this guide for the best practices when hiring an offshore software development company. Despite the size and the industry of the business, offshore software development is not beneficial for every entrepreneur in many aspects to make the optimum use of talents in technology across the globe.
Here are some of the top reasons why offshore development is beneficial for your business.
To avail of all these benefits, you should have clear goals, a list of requirements, and features that are mandatory for your software product.
Here are a few tips to help you find the best offshore software development company. Build a top-notch software application by following the listed best practices.
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Looking at the current market size of the Global Offshore Software Development, the future seems to be on the pinnacle of success. With the pace of technological advancements, the next decade of software development, meetings, collaborations, and outsourcing will be flawless by bridging all the barriers that entrepreneurs face today. Artificial Intelligence and Mixed Reality (Augmented Reality + Virtual Reality) will transform the way the Mobile and Web Development Companies function. This blog encloses a futuristic vision that will enable young entrepreneurs to check the scope of Global Offshore Software Development in the next decade. Find out how to hire offshore software developers with whom you can reliably outsource your mobile and web development.
The Changing Work Life
Something is constantly changing in the working world of today. An evolution forces organizations to think differently about what it means to be an employee, a manager, or an entrepreneur thinking to outsource software development offshore to a remote software development company. Five trends are persuading this evolution to trigger by challenging everything that you consider normal work patterns.
Globalization- Globalization has arranged the entire world within a big city-like arrangement. Language, culture, currency, geographical location, etc. now matter much less. Organizations can find talented developers from any corner of the globe.
Mobility- Thanks to Mobility, we can stay connected to our favorite people and the needed information anywhere, anytime, and on any device. Hence, work is no longer a destination to go; instead, it is something you carry with you all day in your pocket (smartphone) wherever you go.
Changing Demographics- Currently, the workforce comprises 50% of millennials, i.e., the age group employees 24 to 37, born between 1981 and 1996. By 2025, 75% of your workforce will be millennials. This generation expects and wants to work in modern ways. Say, for example, they don’t want to follow the traditional and conceptual working patterns. Instead, they switch to organizational change.
New Behaviors- Your future employees are changing their mindset and behaviors to adapt to the changing workforce. New behaviors are rapidly entering your organizations. Every aspect of business behavior is completely transformed today. For instance, your employees share their personal feelings, feedback, comments, and thoughts on public platforms, their professional details on LinkedIn, their photos on Instagram, etc. Everything has transformed- from communication, learning, collaboration, teaching, content, finding information, and more in your workplace.
Technology- Modern technologies like Big Data, IoT, Collaboration platforms, Wearable Devices, 5G, and Cloud computing keep us productive and engaged in new work patterns. Technology is the balance wheel of your organization, as it enables everything else to function appropriately. Take a look at how technology will propel our work and life in 2030 in this video:
Clearly technology, globalization, new behaviors, and changing demographics are acting as the catalysts of future work patterns and workforce. Hence, if you don’t take your organization from these needs to the wants of the employees, your organization clearly has no future. Now is the time you unveil the curtains and enter the new generation of workplace and culture.
Are you ready for the future of work?
Meetings in the Future
Today’s meetings are different from how they used to be in traditional offices. Agile methodology has alleviated frequent and quick meetings that aren’t structured. Audio-meetings are a thing of the past; employees expect to communicate without any barriers of locations and devices.
More than 75% of people are communicating with colleagues sitting at distinct geographical locations every day. Those who communicate with remote team members on a regular basis believe that video calls are the best medium of communication.
In the upcoming decade, thanks to Mixed Reality, an employee sitting in his home or any distinct location will be able to join in a meeting with his colleagues in the office in three-dimension 3D with a holographic video call.
This form of meeting where we see the merging of our real-time environments (workplace) with mixed reality (augmented and virtual reality) is known as holographic teleportation. As such meetings take over our work functions, entrepreneurs’ barriers while Offshore outsourcing software development will collapse altogether.
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With more of us using smartphones, the popularity of mobile applications has exploded. In the digital era, the number of people looking for products and services online is growing rapidly. Smartphone owners look for mobile applications that give them quick access to companies’ products and services. As a result, mobile apps provide customers with a lot of benefits in just one device.
Likewise, companies use mobile apps to increase customer loyalty and improve their services. Mobile Developers are in high demand as companies use apps not only to create brand awareness but also to gather information. For that reason, mobile apps are used as tools to collect valuable data from customers to help companies improve their offer.
There are many types of mobile applications, each with its own advantages. For example, native apps perform better, while web apps don’t need to be customized for the platform or operating system (OS). Likewise, hybrid apps provide users with comfortable user experience. However, you may be wondering how long it takes to develop an app.
To give you an idea of how long the app development process takes, here’s a short guide.
_Average time spent: two to five weeks _
This is the initial stage and a crucial step in setting the project in the right direction. In this stage, you brainstorm ideas and select the best one. Apart from that, you’ll need to do some research to see if your idea is viable. Remember that coming up with an idea is easy; the hard part is to make it a reality.
All your ideas may seem viable, but you still have to run some tests to keep it as real as possible. For that reason, when Web Developers are building a web app, they analyze the available ideas to see which one is the best match for the targeted audience.
Targeting the right audience is crucial when you are developing an app. It saves time when shaping the app in the right direction as you have a clear set of objectives. Likewise, analyzing how the app affects the market is essential. During the research process, App Developers must gather information about potential competitors and threats. This helps the app owners develop strategies to tackle difficulties that come up after the launch.
The research process can take several weeks, but it determines how successful your app can be. For that reason, you must take your time to know all the weaknesses and strengths of the competitors, possible app strategies, and targeted audience.
The outcomes of this stage are app prototypes and the minimum feasible product.
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