Nearshore Development Firms: Why Are Businesses Making the Change?

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Nearshore Development Firms: Why Are Businesses Making the Change?

Businesses are now changing towards nearshore develop as it helps them complete their projects and solve worker conflict faster. Find out why businesses are making this change in this quick post.

What Is Nearshoring?

Nearshoring is when a business opts to have developers/employees in nearby countries placed closer to their main operation location. For instance, a US company hiring services from Mexican, Costa Rica, Argentina, or Brazil is a good example of nearshoring.

The nearshore company has the same time zones, fewer language gaps, similar cultures which all create a better Return on Investment than traditional outsourcing methods. Canadian and U.S. businesses that are planning to reduce project costs and increase worker velocity are looking for nearshoring options. Here are the main reasons why:

Better Proximity

Since 2005, we’ve noticed a reduction in offshoring numbers while the nearshoring employment options began to rise. How come?

Most experts state the reason is due to geographical proximity. When you offshore your work, there is a lag time (about or more than 12 hours) and even less control over deadlines, quality, and projects.

Because of these timing and distance issues its harder for employees to communicate with each other properly. And when the longer time frames aren’t evident, bad working conditions are. Usually, most offshore development teams have a lower quality of life, higher turnover, and this takes a negative toll on the outcomes and software quality.

Cultural Affinity Can Improve Results

The cultural alignment of your team is important as it goes beyond a shared lifestyle and language. Offshoring your business to developing natures causes business risks such as a less centralized civil infrastructure and problems related to your intellectual property.

Creating a cultural affinity is necessary to any outsourcing team. Now, businesses are attempting to increase the agility of their workers via offshoring have experienced communication obstacles and cultural barriers.

North America and Latin America have a shared cultural history and a border that’s been in place for over three centuries. For nearshore development firm, cultural alignment makes a more collaborative and efficient working environment across the teams. This leads to fewer complications throughout the project.

Reliable Talent

To know the main differences between nearshoring and offshoring, you need to understand the variations in the talent. Usually, U.S. businesses offshored responsibility roles and lowered salaries to cost-effective areas in the world. However, this trend is starting to change.

New technologies and user demands are changing how businesses use outsourcing tactics. Initially, U.S. businesses used offshoring for low-level positions during the 1990s and the early 2000s. Now, these businesses use outsourcing software development teams for more strategic and robust roles as well.

Working with nearshore companies means that the developers have a similar time zone, making it easier for employees to work together. Nearshore development firms don’t have to worry about cultural and language barriers making it easier for them to meet project goals and deadline.

Increased Return on Investment

Why do businesses outsource their work? Simply, Return on Investment. Since companies are trying to outsource for a better ROI, most of them attempt to nearshore their employee talent first.

How come? Because offshoring your software team can increase project timeframes and costs. With nearshoring, the timezone proximity makes it easier to reduce the resources and time it takes to meet project deadlines, which lowers the overall cost of your projects.

Closing Thoughts

When establishing a nearshore development firm, you have to be clear and direct with your team. Since they have the same time proximity and cultural background, it will be easier to manage than traditional offshoring methods. So, make sure that your nearshoring team is on board and complies with your project requirements so that they can complete it efficiently!

Sources:

  1. http://www.techbaa.com/top-10-reasons-for-nearshore/
  2. https://www.huffingtonpost.com/megan-bramefinkelstein/3-reasons-why-nearshore-sourcing_b_11565748.html
  3. http://www.prosoftnearshore.com/3-reasons-to-use-nearshore-versus-offshore-outsourcing/
  4. http://www.prosoftnearshore.com/offshore-vs-nearshore-software-development/
  5. https://www.growthaccelerationpartners.com/blog/nearshore-development-traditional-offshore/
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