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How Offshore Software Development Benefits SMEs and Start-Ups in The Time of COVID-19

 

It has been almost eight months since the virus outbreak, and the overall picture is still grey. The economy in many countries was hit hard and entered a recession. Businesses closed, people lost jobs. Needless to say, SMEs and Start-ups are greatly affected and struggle to survive. However, some still managed to thrive during and after the pandemic. This means that with the right strategy, it is possible to generate revenue and prosper.

A good survive-the-pandemic strategy can be many things: cash management, diversifying incomes, reinforcing the relationship with customers, cutting costs, outsourcing, etc. In this blog, we will explain how offshore software development can benefit SMEs and Start-Ups in the time of Covid-19.

How Offshore Software Development Can Help in The “New Normal”

Over the period of nearly eight months, the “new normal” has laid down the foundation for a rather different kind of future. A few things to list out:
- People are under geographical isolation, followed by traveling restrictions.
- More fights against invisible enemies like deadly viruses are expected.
- Businesses with face-to-face interaction like Hospitality, Entertainment, and Beauty must change and speed up their digital transformation in order to recover.
- People spent 20% more time on apps during lockdowns. Something very physical like dating has also seen a boom in the usage of dating apps! It is estimated that spending on mobile apps will double by 2024, despite the economic downturn.
- Applications and software as a service (SaaS) are both on the rise.

The demand to go digital is more important than ever but the undertaking is not easy in this crisis. So, how can software outsourcing help exactly?

Offshore software development has long been a favorite in the tech world. It helps business owners cut down expenses while maintaining high-quality work. Fast forward to the pandemic, software outsourcing is helping businesses in many ways. However, to really benefit from this service, there are a few elements worth taking notes.

communication

 

Offshore Software Development Success Factors to Note Down

Emerging Locations for Qualified Offshore Software Development

Without a doubt, India and China have been hot spots for offshore software development for a very long time. However, the sector has seen a steady rise of countries in Asia, CEE (Central and Eastern Europe), and South America. In a 2019 report on the global developer population, the strongest growth belongs to Asia. Apart from China, rockies like The Philippines or Vietnam are getting more recognition thanks to their skillful developers and competitive pricing.

Besides, the supportive policies from the government and local authorities play a significant role. For example, Da Nang city in Vietnam has come up with a 3-phase plan to boost its IT outsourcing service and attract foreign investment.

Newcomers mean more fierce competition but it also promises better options for a reasonable price for clients. The talent pool has expanded widely, and is estimated to be even bigger by 2024 with more than 28 million software developers worldwide. For SMEs and Start-ups during and after the pandemic, this can be a good survival strategy.

Specialized Teams at an Affordable Price

The tech industry always evolves. New programming languages arrive every few years and demand constant learning from developers. Yet, it requires in-depth knowledge and experts who cater to certain areas. However, this level of maturity only comes with a serious investment of time and resources. Therefore, instead of trying to become a full-service software development company, developers choose to focus on fewer areas and devote themselves to do very well.

This indicates that SMEs and Start-ups can find a team with a specific set of skills more easily, without the crazy budget proposal from big companies that do full-service.

Agile Development

Software developers understand agility better than anyone else. Any web or mobile app requires stability, quick bug fix, better functionality in new updates. In order to do that, developers have to master working non-linear: they juggle between assessing reviews and working on new releases, almost simultaneously.
Moreover, an outsourcing software development team needs to keep on improving their working flexibility. Why? Because they need to prepare themselves for changes upon team restructure. In a time like this, agility means more when the unexpected is...well, expected.

To SMEs and Start-ups, this opens up a good opportunity for better integration and a stronger connection between outsourcing and in-house teams.

agile development

 

Blended Workforce

A slightly positive note about the pandemic is that it has made remote working mainstream. According to Upwork, by 2028, 73% of the workforce will have remote workers. And SMEs and Start-ups have the advantage in this case. Especially, start-ups are known for their breaking-out-of-the-corporate-office attribute.
What about offshore software developers? Well, working remotely is basically their norm.
As a result, this will become a solid cultural fit for both clients and offshore teams, and ultimately boost the working culture harmonization.

Developers on Hire Become Strategic Partners

The next evolution of the blended workforce will be the partnership. Indeed, the mindset “outsourcing teams are not part of the company” is seeing a shift due to the current global state. Clients started to see that when fostering the outsourcing relationship to become a strategic partnership, they would benefit a great deal.
When a business sees its software outsourcing team as the extended arm of the core business, they are more likely to share the big picture with the offshore team rather than just in parts. The offshore team will not only have a chance to better evaluate their partner’s brief, but also use their expertise and creativity to contribute more ideas to the project.

The idea of giving equity in the collaborated ventures may first come as a way to offset low salaries, often occurring when a client in the US hires a developer in Asia for example. However, letting the offshore team share equity means letting them share risk, and therefore, increasing commitment in the long run.

Collaborative Tools Become the Must-Have Standard

The arrival of collaborative tools like Monday.com, Trello, Jira or Asana is of natural process in the workplace. Gone the day when teams spend an enormous amount of time following up and exchanging ideas in the meeting room, or filling out to-do Excel spreadsheets. These powerful tools streamline communication and reduce the hideous, repetitive steps that slow down productivity.
The tech industry also benefits from tools catered for developers like GitHub, Visual Studio, or Microsoft’s Azure DevOps. As for SMEs and Start-ups, this means more effective teamwork, less headache, and more time to invest in keeping their business viable.

offshore software development benefits smes startups

Cloud Computing Technology

It is in no one’s interest to see an error in the local server or missing data jeopardize the hard work. With cloud computing technology, applications can be built and launched anywhere, anytime. Thanks to this, SMEs and Start-ups can really “expand” their 24-hour limitation. Imagine a start-up in the US working with an offshore software company in Vietnam. We already can see a big gain: 12 hours in the future and their work continues while they’re fast asleep.

Final Thoughts

No business is immune to the negative impact caused by Covid-19. That is a fact. However, the pandemic also opens up new ways of thinking and building resilience. We firmly believe SMEs and Start-ups have a fighting chance, and hope that they can optimize offshore software development to successfully transform and come out of the crisis alive.

 

CTA Enlab Software

 


Reference
NTT’s 2020 Global Managed Services Report
Statista’s Global Outsourcing Market Size
Ibisworld’s Business Process Outsourcing Services in the US Market Size 2003–2025

About the author

Nhu Nguyen

The intersection of marketing and technology has created the sweet spot to discover my Ikigai, either in my professional or personal life. Spending much of my career in tech, my passion is building elegant brands and data-driven marketing techniques tailored for the tech community.

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