How To Choose a Trusted Development Vendor to Run Your Project Offshore

In response to the growing industry of offshore development outsourcing and the relatively low entry entrance threshold, a lot of new players appear on the market daily. Unfortunately, not all of them are equally reliable to collaborate with. In this article, we suggest a pitfall-free tactic to choose, screen, and validate the development vendor which will actually be able to drive your project growth.

What Is IT Offshore Outsourcing and What Benefits Does It Drive

The concept of IT offshore outsourcing is pretty simple. In a nutshell, this is an approach that suggests running your tech project development abroad or offshore, that is, beyond the boundaries of your homeland continent. In our recent articles, we have also dwelled on the main benefits of running a business process offshore, so let's recapture them in brief. 

• Access a greater talent pool than you have locally. The most popular software development outsourcing destinations usually offer a bigger tech talent pool compared to a homeland country. For example, there are 200,000 developers in Ukraine, which represent the second-largest talent pool in Europe. That’s why Western European countries frequently choose Ukraine as their outsourcing destination, in addition to other benefits this county can offer. 
• Speed up the recruitment process. Offshoring the project development also allows for speeding up the process of recruitment but in this case, you have to get in touch with the talent sourcing vendor. The latter usually have either access to the database of relevant candidates or ready-made tech teams that can get started with building your project immediately. 
• Optimize operational costs. One of the main reasons for switching to offshoring is the opportunity to significantly decrease operational costs. Usually, the cost of rent, equipment, and setting up the production process is lower in countries with lower living standards. For example, the hourly rate to hire developers in Ukraine is $25-50 while the wage of American programmers is $80-150 per hour on average. 
• Add agility and flexibility. Running a development process offshore in a partnership with a tech vendor allows for better flexibility and agility. In this case, you hire for a service instead of hiring people, and that’s why your development team can easily be scaled or shortened in response to the changing business needs.

How to Find an Offshore Development Vendor

However, getting all these benefits for your project becomes possible only when your software development outsourcing strategy is well-planned, and there is a trusted tech vendor nearby to support you. Below is a step-by-step tactic to choose a suitable offshore development company and grow your project in a better-optimized way.

1. Decide on a destination

Recently, Statista has issued a list of the leading offshore development countries worldwide, mentioning China and India in the Far East, Brazil and Mexico in Latin America, and Poland and Ukraine in Eastern Europe. So, the choice options are actually great, so below is the list of crucial factors to consider for making the right one. 

• Talent pool. Consider the size of the talent pool, along with the technologies the developers are most skilled with. Be guided by Hacker Rank research as one of the options. 
• Education. Next, consider the level of higher education in the country, paying attention to the number of tech universities and the educational standards they follow. 
• English-proficiency. Also, keep in mind that not all countries prioritize English learning in schools and universities. To get an idea of English proficiency in a certain country, take the English Proficiency Index rates into account. 
• Time zone. In the next stage, pay attention to time zones and prioritize the country with the best overlap if staying in touch with the team is crucially important to your project. 
• Cultural fit. When analyzing cultural background, try to find the perfect balance between cultural diversity and cultural fit. For example, according to this logic, the projects from Western Europe are frequently outsourced to its Eastern part. 
• The expected costs. And at the last step, research the hourly rate of the developers in potentially suitable countries and tailor the figures to your budget expectations. 

2. Shortlist the potentially suitable vendors

After you are done with the destination choice, proceed with Clutch and Good Firms to shortlist the potentially suitable development vendors. Pay attention to the following factors. 

• Company’s expertise. Let’s suppose you have to develop an artificial intelligence project. In this case, getting in touch with a company skilled in WordPress development has no sense since the lack of specific expertise may lead to costly mistakes and pitfalls. 
• Company’s size. If you have to hire 3-5 team members, partner with a smaller company, and vice versa. The rule is that the larger the team you need, the larger the company’s size should be. 
• Company’s reputation and transparency. Also, pay attention to their online reputation and the reviews shared by the previous customers. Keep in mind the possible drawbacks they might be mentioning. 

3. Decide on the engagement model

As you might know, there are several approaches to running a development process offshore. Let’s take a brief look and tailor each of them to the project’s specifics. 

• Fixed-price. This engagement model makes sense for small and predictable projects when there is an opportunity to accurately estimate the planned costs. 
• Time and material. Time and material contact, vice versa, is good for the projects with expected technical challenges, so in this case, paying as you go is the most reasonable tactic. 
• Dedicated development team. In our recent articles, we have already shared the best tips to hire a dedicated development team. This is the most expensive type of outsourcing contract which is suitable for large and ongoing projects developed according to Agile methodology. 
• Setting up an offshore development center. This tactic is a quick-win match for the companies which need to establish a presence in a foreign country and relocate their IT department abroad, maintaining it at a lower cost compared to the homeland.  

Run a consultation series with several development companies and listen to their suggestions as to whether certain engagement models suit your business best. Next, choose the smartest tactic and proceed with screening the potential vendors.

4. Clarify your requirements and communicate them to the vendor

Next, get back to your project requirements and communicate them to the vendor. The goal is to make sure the company has access to the necessary tech talent and can quickly source them for your project according to the chosen engagement model. 

• Team size. Decide on the team size, plus communicate your expectations as for their background and seniority. At this stage, a competent vendor is likely to suggest the more winning tech stack to power your project with, as well as the better-optimized development team structure, being guided by their practical experience. 
• Expected budget. Being aware of the average hourly rate of programmers in the country of your choice, you can clearly plan your budget, plus check the development vendor for transparency and fair charging.

5. Run the interviews with the suggested candidates

Trusting your development vendor is good, however, you are always welcome to interview the candidates on your own before hiring them for your project. Some startups also hire a third-party tech consultant to help them with technical and non-technical interviews. 

• Technical interview. The goal of a technical interview is to make sure that the candidate has the necessary experience, expertise, and knowledge to contribute to your project development. Assigning a short test task is another adopted practice to check real-life skills. 
• Non-technical interview. As for the non-technical interview, the goal is to make sure that the candidate makes a personal and cultural fit. At this stage, you are welcome to ask them about the mistakes and challenges, growth plans, accepted and unaccepted things at the workplace, and so on.

6. Run your project

Congratulations, you are done! Now you are welcome to start your project development but before you do it, pay attention to the following checklist. 

A Great Outsourcing Deal - The Checklist

• Expertise match. Your perfect development vendor should have such development expertise that enables them to solve your project challenges and use the up-to-date programming languages, tools, and frameworks. 
• Budget fit. The suggested budget estimate should fit your expectations and financial capabilities. Discuss this issue and write down the necessary requirements in your contract with a vendor. 
• Clear communication. Communication with your vendor and the tech team should be seamless, clear, and quick. You should feel comfortable and stay on the same page with them. So, don’t hesitate to suggest the communication practices and rules that make the most sense to you so that you can control the project, stay updated and resolve the urgent issues quickly. 
• Data protection. A Non-Disclosure Agreement is the core document that protects your data and your intellectual property. Make sure to sign it in advance, even before the first consultation with the vendor, and share your project ideas, especially if you plan to create something truly innovative. 
• Flexibility. Your development vendor should stand for flexibility and agility. being ready to quickly meet the growing project needs and source the necessary talent.

Conclusion

Running a development process offshore is a value-adding choice but partnering with a reliable tech vendor is a must to grow your project according to this strategy. We, at SpaceBus, have up-to-date development expertise and life-proven offshore outsourcing practices to help your business evolve, save operational costs and hire the top talent.