An Ultimate Guide to Offshore Product Development

Posted By Praveen Joshi

July 21st, 2022

An Ultimate Guide to Offshore Product Development

Software development is now not only limited to the IT bigwigs. Multiple players are emerging with their world-class services. To be in the scheme of things of the market trends, they all adopt different methodologies. Outsourcing methodologies such as offshore product development are among the most common ways to increase output. There are various reasons why businesses prefer offshore product development services. An extended reach to the wide pool of talented developers and cost-effectiveness are also among these reasons.  

Further in the blog, you’ll get to see all the must-know things about offshore software development.  

What is Offshore Product Development? 

Offshore Product development is the process of outsourcing a development project partially or completely to a third party. However, the amazing benefits of offshore software development are the main reason for its popularity. But sometimes, businesses prefer offshore to counter the scarce availability of resources. Offshore services might help you with your projects at lower costs and within a quick time.  

In other words, offshore development is when a company hires staff or team remotely from another country to deliver a project. For example, a company in the USA hires a development team from India, China, or some other country in Asia. Offshore development is a subsidiary of the following outsourcing methodologies: 

  • Onshore Outsourcing: When a company/client chooses to hire a development team in their own country. 
  • Nearshore Outsourcing: Hiring staff from countries having similar time zones.  
  • Offshore Outsourcing: Partnership with teams from different distant countries to complete a development project. 

Although these are general categorizations. There are no strict rules to differentiate these terminologies. A US company outsourcing a project to an Argentinian company is a suitable example for both nearshore and offshore outsourcing.  That’s the reason why most service providers term themselves as both nearshore and offshore development company. 

Moving on, let’s have a close look at different levels of offshore development… 

Levels of Offshore Product Development Services 

The development requirements and trends quickly change in the market. Hence, it is important for Software development firms to keep their services flexible. We can categorically divide the offshoring services into three types: 

1. Low-Level Outsourcing 

In low-level outsourcing, offshore services are trusted with low-level coding solutions only. It is the cheapest model to engage your business with offshore software development services. Moreover, in this model client themselves manages the product. The offshore services are only responsible for quality assurance of the assigned development task.  

2. High-Level Outsourcing 

It has a bit higher cost than the low-level model and involves in-depth coding solutions. Here, the offshoring company looks after both project management and test design. Whereas the customer oversees testing and quality assurance in this module. Businesses typically hire architect-level software engineers and developers at this level.   

3. Complete Technical Outsourcing 

As the name suggests, here the offshore product development team becomes responsible for the whole project. From product management and design to development, testing, and release all become a part of their job. Even after implementation, the offshore company is the one to provide technical assistance. This module is about the full-fledged usage of outsourcing services. 

Different Models of Offshore Development Services 

1. Fixed-cost model 

In this model, there is a fixed price of finishing the whole project from start to finish is set by the offshore services. This feature makes it the safest model by eliminating the risks of any hidden cost. This model is suitable for projects having pre-defined scope and objectives. Furthermore, the success rates of these projects are very high. 

Fixed Cost Model

2. Dedicated development team  

This model is a lot different than the previous one. Here, you get access to a large pool of professionals completely dedicated to your project. Businesses get the freedom to hire their dream team of developers here. Furthermore, they can choose staff having the desired skills for their project. Also, you save a lot of time and money on recruitment and administrative processes. Additionally, the control over product management remains with you. 

3. Hourly or time and material  

It is a suitable model for projects that are rather more complex. The ‘time and material’ model is a flexible model. It supports the development of projects in which requirements may change during the development process. Here, the volume of work might change from time to time. Therefore, the offshore services charge their clients based on time and resources deployed on the project. 

Benefits of Offshore Product Development  

Offshore development comes with mutual benefits for both the businesses and developers as well. Some of the key benefits of offshore development are: 

Benefits of Offshore Product Development

  • Cost-effective: A lot of the funds of the company go into the maintenance of regular staff. By outsourcing the development projects, they can save a lot of money. Also, the developers who get these projects get more than they usually get while working at local firms. This way, everyone gets something out of it. 
  • Flexible: Offshore development services allow you the flexibility of scaling up and down your team according to your requirements. Also, your development task can go on 24*7 if you hire a team from a different time zone. 
  • Quality of service: Through offshore services, you get access to the best developers. The geographical barrier to hiring talent is eliminated. Hence, you get the best possible skills in your team members to accomplish your goals. 

Although there are a few challenges such as language and cultural barriers. But conclusively, Offshore Product Development services are the future of software development. 

 

Praveen Joshi

Praveen is a seasoned IT Solutions Leader and Director at RSK Business Solutions, a technology-driven IT Consulting Company that specializes in Bespoke Software Development, Agile Consulting, Mobile App Development, Smart Sourcing, and much more. For the last 17 years, he has been delivering quality custom IT solutions that help businesses achieve their goals.

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