IT outsourcing has attracted massive attention and turned into a thriving industry as the overall global market valuation was $526.6 billion in 2021. Plus, it will gain an additional $155.7 billion by 2027. This growth is caused by the increased demand for digitalisation and advanced products.
In addition to China and India being popular locations, many other countries appeared in an outsourcing environment. But it is still hard for big companies to pick a trustworthy partner that meets their needs and requirements. Fortunately, you can fix it with our advice on the best destinations to outsource software development.
Why Companies Decide on Software Development Outsourcing
Many industries decide on outsourcing software services, from finance and procurement to IT. And such a collaboration bears fruit since hiring outsourced teams provides comprehensive business automation. Let’s look at the top five reasons for hiring an external squad.
Minimised Workplace Organisation and Hiring Costs
The latest Deloitte’s Global Shared Services and Outsourcing Survey Report shows that outsourcing is considered the number one priority for 54% of companies. They select this business model to increase efficiency, reduce costs, and drive greater business value.
But how are they saving resources? Here is an answer: an in-house team should be placed in a comfortable workspace with high-level equipment and comfortable furniture. With a dedicated team, you should pay only for the time spent by the developers, and the rate can be much lower than in your country. Plus, the software outsourcing service vendor takes over the recruiting processes organisation.
Getting a Complete Development Team or Individual Specialists
Moreover, this business model allows companies to get an entire development team or hire separate developers/business analysts/project managers. If you operate a big company with a large staff, you will be able to hire a whole dedicated team. But if you begin your business way as a startup and you do not have a marketable product, hiring several developers is enough.
AKQA’s Chief Technology Officer Rei Inamoto provided a perfect startup formula: hackers (developers), hustlers (managers and analysts) and designers. And your task is to have all of them build your business.
Involvement of Skilled Employees With No Risks
If you hire the right specialists, you will reach success with your product. This formula always works, so you should take the recruitment process very seriously. Ideal IT outsourcing companies have a relevant background in your field, required technical expertise, ad hoc problem-solving, high communication skills, and a keen interest in your project.
Moreover, collaborating with freelancers is risky since no one can guarantee the timely completion of tasks and a high level of specialists’ expertise. By hiring an external team, you can cut these risks.
Less Adaptation Time
IT outsourcing businesses have a massive pool of experts who worked on some projects together. Thus, they can easily adjust to the new business requirements and create a digital product at a given time.
Focus on the Business Tasks
A dedicated team implements advanced development methodologies (like Scrum or Kanban) to create remarkable digital products. You can monitor the progress and clarify all details with a responsible employee, but your direct involvement is minimal. Thus, you assign the time saved to perform the core business tasks.
If you try to build a well-coordinated dedicated team, you should understand the importance of communication in remote companies. Learn more about strategies to prove quality communication within the dedicated team here.
What Makes a Country Good for Outsourcing?
When choosing the most appropriate location to outsource software services, you should focus on some key aspects:
- The IT market level. This aspect is essential for making the final decision. It depends on the volume of the software-based infrastructure in a specific country, the number of stable tech businesses and their ability to compete in the global market.
- Costs. Outsourcing expenses are also vital when picking a trustworthy vendor. Here, countries from Eastern Europe provide the most affordable pricing towards the price/quality ratio.
- The IT education quality and tech diversity. Companies still prefer to pick developers with higher education in computer sciences or related fields, but startups are also interested in employees with IT courses background. The Stack Overflow survey shows that about 75% of respondents have a college or university degree. If talking about skill diversity, ask the IT outsourcing services company about their tech stack (e.g., JS, PHP, Scala, Mobile Development, etc.), case studies, and ideas they can realise. Therefore, you will get a more comprehensive impression of the collaboration prospects.
- The preferred language skills. Most developers worldwide have an excellent command of the English language. In most cases, dedicated team members speak English at an Intermediate level (at least), but candidates for essential roles have to be more advanced in their language skills.
- Different geography and time zone. This aspect affects real-time communication via team chat or video conferencing. Eastern European destinations may be the most suitable choice as their time zones overlap time zones in the EU and North America.
- The difference in culture. If you plan to build a long-term partnership with your IT partner, you should adapt to their country’s culture. Thus, it is vital to find a close-minded outsourcing vendor.
Once you have understood your needs and requirements, you can select a dedicated team that provides custom software development outsourcing.
Top 4 Locations to Outsource Software Development
The high interest in outsourcing services has created an extensive global market. Some Eastern European squads offer first-class services, a broad range of technology skills and reasonable pricing. Let’s review the top four software outsourcing locations.
As for now, Ukraine is one of the most interesting outsourcing destinations. About 200,000 professionals create digital products in more than 750 software development outsourcing companies, with a growth of up to 30,000 employees yearly. The HackerRank’s Score Index shows that Ukrainian developers received 88.7% on all tests. According to research by the IT Ukraine Association, 80% of specialists speak English at an intermediate level and higher.
Ukraine’s time zone is GMT+2, which overlaps American and European locations. This country has an outstanding ecosystem with a cross-cultural fit, an innovative software development approach, and low pricing – $25-$45 per hour (based on the Upwork data).
This country is also a top software outsourcing destination because of the low pricing, a large talent pool, and implementation of cutting-edge technology. Thus, we can name Romanian developers as strong competitors to their Indian colleagues.
External teams from Romania are known for their high skills and extensive expertise. This country is currently 15th in a global ranking of English proficiency. Moreover, a high percentage of developers have an additional command in Hungarian, French, and Italian.
An average cost of services developers is $25-$50 for a mid-level developer. Moreover, a little time difference from the EU provides effective communication for better digital product development.
Polish IT experts rank third on the global HackerRank Score Index at 98.0%. They have the most excellent expertise in Java and a good one in Python, Ruby, and algorithms. Software experts are also known for an exceptional command of English because around 40% of Polish speakers speak English at an intermediate level and higher.
The Polish IT market offers an extensive pool of software developers and is reasonably priced simultaneously (around $40-$60 per hour). As reported by various clients, engineers in Poland are proficient with a strong work ethic and very few differences in culture.
Poland uses the Central European Time (GMT+1), providing enough overlap to allow functional collaboration with European and North American customers.
Over 150,000 software developers work in Hungary, and about 12,000 employees join the market yearly. This location ranks 5th in the HackerRank Score Index, making it one of the best countries to hire an outsourced software product development team. The main expertise of local IT specialists is creating databases and tutorials, as well as wring code in Java, Shell, and C++.
Hungarian developers have a great command of English, as Hungary is 17th on the English Proficiency Index. This country has a large talent pool despite its small population. Furthermore, local specialists will charge less than their Western European colleagues ($20-$55 for a mid-level engineer).
Globalisation gains more traction yearly, and companies worldwide can reach qualified experts in any country. It is also boosted by the resource-intensive process of choosing local developers. However, you should ensure effective communication and collaboration within your external squad; thus, you have to be serious when choosing the software outsourcing company. At Rocketech, we know how to create remarkable digital products. Our dedicated teams do their best to develop software that increases your revenue by combining advanced methodologies and the extensive expertise of each employee. If you are ready to benefit from a productive collaboration, contact us now.