Nearshore Outsourcing Advantages
All of human development is a progression bar of discovering one invaluable resource, technique, skill, etc., and then making that meteoric development near obsolete. It is within our nature to compound upon what is already established, polishing and rendering every previous iteration an artifact within as short an amount of time as possible. Every generation of phone, every model of computer, every surgical and medical technique, every technological and sociological advancement has a predecessor it improved upon.
The pace at which we grow works like convergent evolution, wherein branching techniques coexist, but most of the time one option proves more useful than the other. The branching options that have evolved from pursuing the most effective and lucrative outsourcing opportunities follows something similar to this. For the longest time, offshore outsourcing was the de facto poster child for outsourcing work. However, as has always proven to be true, the tide for the software development market is starting to shift.
Nearshore app development is becoming an increasingly viable and useful option for outsourcing. With a world that has embraced the digital era, it’s easy to see why there’s been a subsequent rise in nearshore outsourcing popularity. The fact that you can use Nearshore development teams to build all sorts of software at great rates makes it the preferred option for many companies. When considering Onshoring and Offshoring benefits and disadvantages, Nearshoring offers benefits combine the best of both worlds.
Nearshore App Development is Cost-Efficient
The driving principle behind just about every corporation in the world is to achieve the greatest possible productivity while avoiding burning a hole in your pocket. Cost-efficiency is the term of choice in regards to risk, expenditures, quality, quantity, speed, and virtually any other statistic that bears weight on how effective your company is.
It also happens to be the main reason why outsourcing became such a well known practice today. Retaining work and production within the American border may promote a sense of patriotism for some, but it also tends to be more costly. This rule of thumb goes doubly for the software development market, mostly due to one fact: our talent pool is shallow.
With a small talent pool to pull from, several key issues arise, including inexperienced workers foaming to the top, prices for talented software engineers hiking, and increased difficulty in finding the appropriate team members for your company. When there’s not as much competition to go around in the software development sector, ensuring that you’re given the highest quality candidates to choose from is hard to guarantee.
With regards to outsourcing, your offshore options aren’t much better than hiring locally. You’ve certainly still got them beat price-wise, but partnering with a company on the other side of the world has its own drawbacks that go beyond the straight price you first agree on. There are, shall we say, hidden costs to doing business.
Team cooperation is a must-have in software development, meaning that Skype calls won’t cut it. Taking a trip out to see your overseas teams, however, is still an expense that comes out of your paycheck. There are travel fees to consider, such as transportation, food, lodging, and it adds up with every person you’re planning to send as representatives.
And that’s just cold tangible costs, not to mention the burden placed on those sent over. Jet lag is an enormous impairment, especially when dealing with time zones 12 hours opposite your own. You’ll also be separating your employees from the safety of home and family for possibly an extended period of time, and the hours spent traveling in the air will rack up.
This is all to say that, while offshore outsourcing may still provide advantages over its inshore alternative, there are more catches than may be deemed acceptable. Nearshore opportunities, by comparison, suffer none of the ill effects.
Speaking strictly in cost-efficiency terms, outsourcing to Mexico outpaces either of its peers with ease. For starters, Mexico prides itself on a lush labor pool, complete with plenty of IT professionals fit for your company. With a larger supply of people to work with, the same competitive rates we see in the U.S. don’t apply.
Travel expenses, in a likewise manner, are a fraction of the cost that having an overseas partnership may incur. You are, after all, flying just over the border, not over the ocean, and won’t even have to worry about suffering from jet lag along the way. Finally, the strength of U.S. currency allows it to go farther in Mexico, making hiring services there much cheaper.
Like we said, nearshore outsourcing takes the best traits that inshore and offshore have to offshore and combines them into a single convenient package. But we’re not done quite yet.
Ease of Communication with Nearshore Partners
Adequate communication lines are the cornerstone of a functioning team. Imagine, if you would, a team of four being assigned a project and then each member taking off to do their own work alone. No sharing notes, no outlines, no delegation, no quality assurance, no feedback, nothing except the hard-driving chutzpah of each worker’s ethic.
It’s not hard to imagine the hot mess of a final product that would result from that.
This ain’t high school where the smart kid in the class could handle the entire science could backpack their entire group and the project single-handedly. Teamwork in pivotal in delivering a quality polish in software development, and you simply don’t get that reliable sort of communication with an offshore team.
Nearshore partners do what overseas companies can’t: work during your hours. You’re not battling time zones or burning the midnight oil just to arrange a meeting. Plus, Mexican and American culture are distinctly similar enough to elucidate simplified, comfortable discussions that would otherwise take some getting used to with other foreign teams.
Shared Time Zones
The most prescient and obvious blocker for ease of communication between teams is the size of our world. Chatting with a friend on the other side of the country isn’t hard, you just have to be sure to ring them up at a reasonable time. For an international call, however, you’re gonna be going out of your way to set up a call that’s going to be inconvenient for the both of you.
There’s only so much light available during the day, and that’s one of the biggest benefits that nearshore outsourcing has. By virtue of sharing the same time zone, you’ll be sharing the same daylight and working hours, meaning struggling to fit together a call shouldn’t be the same hassle you’d experience with an overseas team.
What does this mean mechanically for your business and projects? For starters, turnaround time is going to be much, much quicker. Similar work hours allows for your teams to be easily accessed by anyone who needs their assistance. If you discover an issue with the project, you can contact your team in Mexico that same day and receive real-time updates. With an international team, you may have to wait days before you get a word back.
This same turnaround performance is facilitated by the ease in which you can set up communication. Video meetings and in-person travel time come at a fraction of the cost and effort spent with an offshore team, saving valuable time and money while improving the quality of the product exponentially. It is, in every sector, considerably more inexpensive while promoting better productivity and satisfaction.
We touched on this earlier, but surely you’re a bit curious about how much of an impact diverse cultures can have in regards to communication. The difference between a Chinese team versus a Mexican team can’t be much more different than the language barrier, can it?
It’s more about familiarity with American work culture. Different countries don’t have to share the same values and traditions to work well together, as those aren’t guaranteed to have an impact on standards of cooperation, but work is affected by your approach to it. Countries in Europe and Asia have an intrinsic way in which they approach work that is distinctly different from the U.S.
Mexican and American work cultures happen to intersect enough that we work exceedingly well together. Nearshore teams, being more accustomed to American work customs and dynamics, are more fluid in establishing communication due to an already extant familiarity. If you’ve ever worked with someone who’s on the same wavelength as you, it’s somewhat similar to that.
That’s just the tip of the iceberg. Name five European brands off the top of your head. Name five Indian brands. Japanese. Indonesian. Australian. The list goes on, and chances are you’re not going to have much luck. The reverse is the same, with these non-western countries being unfamiliar with our brands and media. Nearshore teams, being our friendly neighbors on the continent, already have a familiarity with those products, meaning they also have a strong affinity to working with American companies.
Finally, the language barrier. English may be one of the most common languages in the world, but that doesn’t mean we can assume that means we’ll be able to communicate with whomever we wish. English is a complex language, and there are plenty of overseas countries that don’t readily teach it. You’ll find people around who the world who can speak it, but there’s a drop in communication regardless.
The good news here is that English as a second language is very common, and it just so happens that nearshore teams are much more proficient with it than you are likely to find across international waters. Mexico, in a similar relationship as America is with Spanish, is chock full of fluent English speakers. Communication, by extension, comes more naturally between nearshore partners.
Nearshore Outsourcing Supported by the USMCA
Offshore outsourcing is not without its inherent risks. While you may be getting a product at a cheaper price than it would have been on home soil, there’s a chance it won’t stand up to scrutiny. There aren’t as many laws protecting your IP, ensuring that your product is treated with the respect and earnest it deserves, or that you’ll be able to properly address your concerns through the tangled mess of communicating with someone ten hours ahead of you.
What our side of the world has that any other doesn’t is the USMCA, the US-Mexico-Canada free trade agreement. It’s a unique trade agreement that explicitly only covers those three aforementioned countries is the silver bullet that ultimately gives nearshore outsourcing every advantage over either of its peers. It does so by providing the protections and benefits necessary to encourage trade between the U.S. and Mexico.
Now, the USMCA isn’t quite ratified by all three countries yet, but it’s on the right track. Once it is, it will provide three major benefits: IP protection, simplified visa procedures, and no tariffs on digital products. In the software development sector, this agreement is a gold mine due to that last one. With no tariffs or trade barriers on digital products between nearshore partners, outsourcing becomes even more viable than before.
IP protection and simplified visa procedures aside, though they’re excellent boons in their own right, the USMCA creates preferential access between the U.S. and Mexico for software development. Opting for an offshore software development company in light of the benefits being made available through nearshore companies simply isn’t as viable or smart once the USMCA is ratified. Offshoring will start costing more due to tariffs that don’t apply to Nearshoring.
Offshoring and local outsourcing may have their own preferential qualities when it comes to other market sectors, but in the realm of software development they’re far from ideal. You’re dealing with communication hiccups, expensive travel fares, mismatched work hours, and a general lack of security that you’re getting the product you’re paying for. You can’t expect to deliver a high-quality package deal if the project’s being poorly handled.
Nearshore outsourcing comes bridled with just about everything you’re looking for in an outsourcing partner. They’re easier to communicate and work alongside with, receptive to similar workplace culture, and will be provided for under the USMCA. The advantages of Nearshoring outpace anything that alternative outsourcing options can offer.