For companies, software development by a partner, especially in so-called nearshoring, can make sense in many respects. In principle, it does not matter whether this is established holistically for the entire software landscape or partially for selected applications or processes. Regardless of whether it is short, medium or long-term.
Every company should ask itself two important questions regarding software development before entering the topic of partnership and answer them for itself:
What is the urgency for the realization of my projects?
No matter at what stage the topic of software and digitalization is in your company, it is essential to evaluate how critical the realization of an idea is for the future course of business. The digitalization of processes and workflows, the introduction of apps or web applications or even the implementation of digital products or systems always has a direct impact on the organization, its employees and ultimately on the revenue/cost structure. If, for example, a business case exists in whose calculation the return on investment of such project plans is demonstrated, the urgency can be easily derived. In the simplest case, however, just the presence of software developers at the partner justifies the partnership itself, since the costs are usually budgeted and planned for but the required specialists are stubbornly missing.
Do I want to keep the software competence in-house, or build it from scratch?
Once the urgency has been clarified, the direct follow-up question is whether the software competence can be tapped in-house in existing teams or whether there is a lack of time, capacity or know-how for this and therefore implementation by a partner makes sense. For startups and SMEs before the scaling phase, the question arises as to whether it makes strategic sense to build up the software competence in-house at all or to rely on a partner from the outset. This is a valid point, especially in the context of risk assessment, because reliable professionals can be brought in and a large work package can be delegated. But let’s take it one step at a time.
BENEFITS WITH A NEARSHORING DEVELOPMENT PARTNER
To realize the value of working with a software development partner, you should be aware of the many benefits. Therefore, we will show ten good reasons why it is sustainably worthwhile to shape software development together with a strong nearshoring partner.
Delegate the recruitment process
Forget about the many hours you spend creating profiles, publishing jobs, screening applications and organizing and conducting interviews. The partner takes care of all these tasks and ensures that the right professionals are working for you. Usually, a briefing at the beginning is enough and the process runs by itself for you. This saves you a lot of time which you can use for your actual business.
With a nearshoring partner you also enjoy the unbeatable advantage that you do not have to wait months until the desired candidate or the entire team can finally start work. Depending on the location, different regulations apply in the labor market and your software professional will start working for you after just one or two months.
Access to Software Expertise
Finding good professionals these days, especially in ICT, is very difficult, lengthy and sometimes grueling. After all, projects are on the brink of failure, for which the implementation power is lacking.
With a nearshoring partner, you have access to a talent pool that is x times larger in one fell swoop. You no longer have to limit yourself to the local labor market. This is because you automatically operate in another market without having to do anything. In addition, nearshoring stores are well connected and can multiply the number of valid candidates.
And you are most likely no longer competing directly with your competitors for the best talent. This saves you additional expensive cost blocks, because you can confidently do without pricy recruiters and headhunters.
An important aspect as an entrepreneur and manager is the profitability of your organization. With a nearshoring partner you save money – a lot of money.
You do not generate additional salary costs, you can focus on a smaller team with a few key functions. You hand over the big “doing” to the partner. As a result, you reduce the salary costs (e.g. social security contributions etc.) considerably.
But you also need less work space, reduce office costs, provide less equipment and relieve the coffee till. The support effort for employees is reduced and you can significantly reduce management overhead. In addition, thanks to a lean in-house team, you can also save on employee development, i.e. less training, events and goodies.
Your development team is taken care of by the partner who covers all these things for their employees. From a model calculation we know that, for example, Riwers as a partner will save you about 40% in costs thanks to the development center in Slovakia. Even the billing is very simple, all costs are included in an hourly rate, which makes your budgeting a breeze.
Reach your goal faster
With a partner you get professionalism in software development. Define and ramp up the organization, prepare projects, allocate teams and make them fit, develop and deliver software according to state-of-the-art methods: Daily Business.
On the one hand, this enables you to reach your goals faster, and on the other hand, by focusing, productivity is significantly increased and you get more “software” not only faster, but also for less money.
Don’t even start to think about what it takes to work with a nearshoring partner. At best, you’ll be overwhelmed by the assumed amount of work you’ll face. Parallel to your day-to-day business, which already keeps you more than busy enough.
None of this is a problem, because an experienced partner knows what is important, has the topic under control and offers a standardized onboarding. All the work packages needed to get the software development up and running with a distributed team setup are fixed to it.
Your involvement is reduced to a few workshops and meetings in which a customized organization is defined under the leadership of the partner.
A crux of team planning is whether the organization will consistently generate enough work over the long term to employ its own software team. I need a team for the strategically critical projects A and B now, but what do I do if I don’t have any follow-up projects afterwards or can only employ half the staff? And can I even find the required specialists within a reasonable period of time to be able to start the projects at all?
With a nearshoring partner the scaling question is answered: He provides the right team at the desired date and scales the team up or down, exactly as the customer needs it. So there are only costs where there is direct added value as a “consideration”.
Of course, such a team that “breathes” needs rules of the game. To be fair, the team size is confirmed or changed at regular and predefined intervals. But if this mechanism works, a comfortable planning of the project portfolio is guaranteed.
Another advantage worth mentioning is the delegation of responsibility to the partner. After all, as a customer you are explicitly bringing expertise in software development and organization into your company and making an investment.
Depending on your own level of maturity, you transfer more or less responsibility to your partner. At least to the expertise of the development team to generate flawless code. Often it is even possible to transfer responsibility to the partner in the development organization, in project management, in product ownership or even in the leadership of the overall development team.
In any case, your own organization and its managers can be relieved. This frees up time and energy so that your own employees can focus more on the core business.
Less process overhead
Establishing a new organization or revising and improving an old one is very demanding for companies and sometimes a “back-breaking job”. All the more so when a topic is not necessarily part of the core business but is nevertheless crucial for the long-term success of the company. For example, software development is by no means a central topic everywhere, but the longer it is, the more it becomes an important profit factor or becomes so important that it should be taken care of.
The good thing about working with a nearshoring partner is that he already has a lot of process know-how in their quiver, which can be used elegantly. This means that entire process models, role definitions, delivery objects, control mechanisms and documentation are already available and can be quickly adapted and applied to the respective needs and maturity of the customer.
This means that you do not have to go through long “discovery phases” and the time-consuming development of entire process landscapes from scratch. In just a few steps, collaboration can be defined, documented and established so that your team and the entire company can quickly benefit from high productivity.
Clarified questions about technologies & tools
“Follow the tool” is a common mistake made when establishing new tools. In other words, favoring a tool or technology without fully understanding its impact or suitability for its intended purpose.
Technologies and tools are part of the toolbox of a software service provider. As a customer, I assume that the “craftsman” is a master of his trade and will solve a problem for me, or develop, commission or maintain a work.
It is the same with software. What is relevant first and foremost is what the customer wants and needs. Once these requirements have been clarified, the appropriate tool, i.e. the technology (or tech stack) or tooling, can be selected and established. From the customer’s point of view, it is completely secondary whether .Net or Java is the best for him or which tool is preferred for planning. He wants to receive function at defined conditions.
This means that the nearshoring partner proposes the most suitable technology from the widest possible range, which allows the requirements to be met. Of course, general conditions such as dependencies to other systems will be adequately considered. In doing so, he will rely on familiar ones, so that a quick start can be made, high productivity achieved and development can take place with little friction loss.
Operational blindness refers to a routine way of working in which no self-criticism is exercised and no opportunity for change is seen. Processes, organizations and solutions are adhered to without being aware that they are outdated, obsolete or unprofitable. In the worst case, this leads to failure with flying flags, often of projects, sometimes, unfortunately, of entire organizations and even companies.
With a nearshoring partner, customers automatically establish an external source of impetus that perfectly protects against operational blindness. In the cooperation, the new colleagues bring new perspectives to the team by themselves. A new quality of exchange is created – professional, factual and human. If the concept of “appreciation” is established in the company, a self-promoting cooperation is promoted, which allows the system to be constantly optimized and improved.
And by the way, the motivation and satisfaction of the own employees increases and even new ideas arise because the constant reflection of new inputs gives more room to creativity.