CIOs and technology decision-makers operating in today’s economy need to ensure that every investment in new applications results in tangible value for the business. Nearshoring – using an IT partner within the Americas – represents some clear advantages over offshoring, especially when delivered with Agile methodologies and Lean principles, according to a recent research paper by Nearshore Americas and Ci&T, a consulting and technology outsourcing services company. Companies using nearshore partners routinely see better client-provider communication, faster time of delivery and greater value in their application development projects, enabling better quality software in every engagement.
Offshore providers trumpet their ability to deliver custom applications at a significant cost-savings to the client. But the reality is that communication issues and geographical distance in these projects may limit the gains of labor arbitrage at the expense of productivity and delivery of true value to the business. For this reason, nearshore IT services providers for application development can be the perfect solution when agility and business contribution are critical: reducing costs by outsourcing while taking advantage of time zone, geographical and cultural similarities. Benefits of Nearshoring include:
· Better Communication – Because of the distance between the provider and the client, typical offshore projects involve the need for extensive documentation outlining requirements for the application, with significant room for misinterpretation and delays due to differences in time zones. Nearshoring provides greater overlap in working hours, enabling teams to communicate directly, often without the need for this cumbersome documentation. Projects are executed with the utmost transparency as clients are kept up-to-date on every single aspect of the development process.
· Efficiency – Because of the overlap in working hours, Nearshoring reduces waiting time for answers to questions or access to deliverables to the bare minimum, increasing the efficiency of every development project. This enables better realization of Agile methodologies like Scrum, as sprints are completed faster and each iteration of software is delivered without delay. Development teams can make on-the-fly changes with just a phone call, while clients can approve the applications, deliver new specifications and address any issues with the requirements in minutes – not hours.
· Value – The efficiency and improved communication made possible by Nearshoring all add up to one thing: greater value for the client’s business. Nearshoring enables better employment of Lean principles, which emphasize eliminating waste (excessive documentation, features that don’t impact the business) in the value chain. Projects are delivered on-time and on-budget, with a total cost that typically ends up being lower than those touted by offshore providers. Most importantly the business receives the software and features that it truly requires.
“The fact is that offshore engagements, while leveraging the huge difference in labor costs between the eastern and western hemispheres, often result in inefficient delivery of applications and excessive waste in development cycles,” said Leonardo Mattiazzi, vice president of international business for Ci&T. “My advice to all companies is to not approach Nearshoring in the same way they are used to doing offshoring. Nearshore provides an opportunity for a more efficient development process and value-driven applications, ultimately resulting in far better results for the client’s business.”
Click here to download a new white paper on the benefits of nearshore development. Additionally, click here to read Leonardo Mattiazzi’s ongoing thoughts on the issues and benefits related to nearshore outsourcing in his recurring blog at Nearshore Americas.