Busting A Big Nearshoring Myth

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Last updated on May 10th, 2024

The dynamic needs of a digitally transformed ecosystem are compelling enterprises to churn out solutions and products faster to meet the needs of their customers – both enterprise and consumer-grade.

With a tech talent shortage that clearly, won’t resolve itself soon, enterprises are looking favorably at strategic options to keep the ball rolling. Nearshoring has often emerged as one such option.

After all, access to qualified professionals and the benefit of working in the same time zone along with other benefits that nearshoring brings are hard to ignore. For the purposes of this blog, let’s assume that nearshoring, a close cousin of offshoring, means outsourcing development work to an established partner in a location close-by.

Given that we have a presence in India and an office in Silicon Valley, I am sometimes the target of curious questions when I speak of expanding our Canada operations. We have been successful as an outsourcing partner for many companies. So why create a nearshore presence?

A strategy to be more agile

It’s the ultimate objective of any organization to keep the client happy. While you are at it, you also want to be proactive in identifying your client’s implied needs. Almost all of our clients have been happy to outsource their product development needs to us and we have been able to work harmoniously with them over the years. However, offering a nearshoring option has become a strategic option – one aimed at creating a new balance in our working relationships.

Being in the same time-zone as our clients assists the agile style of working. This is especially true when working on things such as product prototypes. Reduced turn-around times shorten the feedback loop and hence helps to accelerate the speed of development.

Integrate for scalability

Over time, we realized that some of our clients wanted a greater overlap between their onshore team and our offshore team for specific functions. Having a nearshore team to enable this was simply common sense.
However, scaling a nearshore team has proven to be traditionally challenging for most. By creating a nearshore + offshore model we have been able to mitigate this challenge quite successfully.

To keep the cost efficiencies in place, we leverage the offshore team’s ability to scale rapidly to build smarter alignments and address all resource and related technology needs accordingly. This nearshore+ offshore model also enables faster go-to-market.

Much like how the fashion industry has been using nearshoring to get mass production rolling while making the most of emerging trends, nearshoring in software product development can also work in the same way. Nearshoring can be used to create early product versions that are liable to significant evolution. Once the product stabilizes, larger, process-driven teams in offshore locations take over.

Winning the talent wars

With the technology landscape being in a constant state of flux and evolution, gaining access to top talent in emerging fields such as Machine Learning and Artificial Intelligence can be quite the task. A nearshoring location such as Canada is encouraging skilled migrants. This gives companies in the US access to skilled professionals without the H1B visa concerns concerning foreign workers.

Apart from being a great place to find people with emerging skills, Canada is a great place to hire for more traditional skills as well. Our focus, for example, is to increase and expand our QA strength in the coming year and we see quite clearly that we have a lot of talent to choose from here.
With an offshore +nearshore strategy in place, we offer our clients the best talent and with it a clear strategy to win the challenging talent wars.

The best of both worlds

Perhaps one of the biggest myths in this area is that nearshoring and offshoring are engaged in some kind of a zero-sum game. Companies need to pick one or the other. But nothing could be further from the truth.
When you are looking at ramping up your software development by working with an outside partner, a nearshoring + offshoring format may be ideal. Of course, it makes sense to not evaluate this as a transactional, one-time relationship. Don’t look at it only to fulfill an immediate need but invest in it as a relationship that will help you remain competitive in the long-term.

With technologies changing so fast we need more professionals proficient in emerging technologies such as AI, IoT, cloud, etc. Hiring in the USA these fields can be quite challenging. However, with a nearshore and an offshore team at work for you, you can access expertise as you need it. This will bring unprecedented scalability to your team and give you the flexibility to go out and capture the market without worrying about resource constraints.

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