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10 Tips to Collaborate with Offshore Development Company

What is the Meaning of ODC in Software Development?

An offshore development center or company as known by some is a software studio established by a tech company in an outside country, where there are a plethora of deep technological talents, in this case, software gurus.

Also, most of these studios are planted in countries where the cost of living is considerably low, like the Asian and third world countries in particular, in which the cost of maintaining such will be less expensive compared to if they were to be housed locally in the same country where the tech company is situated.

Offshore Development companies often cover all forms of tech specialty like in copywriting, web designing, project management UX/UI, and a host of many others, except programming and testing positions

These Vendors (people working in an offshore company) can also perform tax duties, HR management, bookkeeping, and virtually every managerial skills.

Types Of An Offshore Development Company

1. The Contractor Model

As the name implies, this is a contract based model that is, of course, suitable for small scale companies.

This very form of outsourcing is more like a “wait and take” instructions kind of model because the main team in the company’s physical edifice, dishes out instructions to the staff in the offshore units. 

Like, the local team are more like the “rule markers” and the vendors are the executioners.

Also, this model works perfectly for companies that have chains of work like in expanding and updating outdated software and so on.

2. The Customer Model

In this model, the customer’s authority is much stronger, which makes it the best for larger companies, or those from a streamlined dimension of knowledge, who seek a great deal of analysis, designs and management tasks to be covered by the customer.

In this very mode of offshore outsourcing, while the offshore development companies do provide a group of developers, other professionals that may be needed will have to be made available by the project management.

Thus, while the vendors/offshore professionals are focused on the coding aspect, specialists from the main office are there to research, design, analyze, test and deliver items.

Now let’s look at why companies set up offshore development centers. 

Are There Pros of Establishing an ODC?

Remember when we asked ourselves earlier, why so many tech companies now seem to love the idea of setting up offshore development companies? Well, the time is now, as we are going to look at some of these reasons;

Having a recognized entity internationally: Expansion is good business. And given that most tech companies have now seen the need to broaden their horizons into relating and sharing their technological innovations with the outside world, then came the urge to establish foreign affiliated entities. 

And of course, it's only inevitable for a tech company who establishes a branch in an overpopulated country to yield better sales and productivity than one that operates locally.

Also, imagine a company who has different offshore centers in virtually every continent and another that just runs its dealing domestically.

To start with, the former will make attaining a prettier level of productivity compared to the latter.

Cost reduction

Another reason why most of these tech companies do establish offshore centers is that it is virtually lesser in cost compared to housing a body of professionals under the same roof.

Hiring a bundle of specialists

In offshore outsourcing, it is possible to hire as many professionals as you’d like to be a part and parcel of your company, which will, in turn, spell out some levels of flexibility in your work dealings. And speaking of flexibility.

Flexibility 

Tech companies know how flexible it is to run an external entity which is why they set up offshore outsourcing centers.

It is less rigid compared to running an in-house body of staff because, those vendors only work when you ask them to, and only get paid based on the hours they’ve worked.

Security measures

I’m sure you must have heard of the aphorism that goes “never put all your eggs in one basket”. 

If security must be taken seriously in any tech company, outsourcing should be a vital part of such measures and here is why. 

For what it’s worth, if you wish to outrun your competitors in any business dealings, you have to keep your next move secret. 

And believe me, the best way to stay discreet is by saving your company’s data in an offshore platform.

Chances are that your classified documents are safer externally than storing them within.

How to Establish and Cooperate with an Offshore Development Company

  1. Pick the right vendor for your ODC.

  2. Look into their records, references.

  3. Make inquiries from customers in that very niche, to gain some insight and advice on how to serve them better.

  4. On picking your vendor, enlighten them on their roles and responsibilities, and how the company is going to be administered.

  5. When making openings for a job opportunity, avoid focusing only on the applicant's educational qualifications, but in their level of skill sets. 

  6. Then, ensure that you’re security measures are as you’d expect, classical. Thus, make sure that only specific people do have access to some top classified information and all. Security measures must be kept in place if one must stand a chance of running a successful offshore company.

  7. The next thing is to start drafting out your desired mode of operation, including the methodology in which you’ll use in executing projects. Thus, you’ll have to outline how you’ll love your offshore team to communicate and deliver project reports to you.

  8. Try making use of project tracking such as Asana or Jira.

  9. Make your new team members(offshore crew) know that they are an integral part of the company, by telling of their role in the main company. You have to give them a sense of belonging.

  10. Lastly, ensure that harmony exists between the local team members and those working in the offshore centers. This should be taken seriously to yield better productivity from the offshore company.

 

So, I guess establishing an offshore company is not so bad after all, given plenty of benefits that accompany it. 

However, the problem is not only in establishing them but in how well a company can run it. That is, if you can’t run an offshore company properly by following the ropes, then it might as well end up as another calamitous project.