U.S.-based companies face increasing pressure to innovate with functional, customized software applications to deliver on their business objectives and outpace their competitors. Nearshore software development presents a cost-effective solution to this accelerated need for digital innovation by helping companies to bring new offerings to market faster and gain a competitive edge with enhanced user experiences.
Many organizations in the United States are just recently discovering the benefits of outsourcing software development projects to third-party providers in nearshore regions. Taking this a step further and developing long-term global partnerships, rather than focusing solely on cost-based short-term solutions, can strengthen your market presence and enable you to execute against a broader digital innovation strategy.
What is Nearshore Software Development?
Geographically speaking, the term nearshore refers to all non-domestic nations that share similar time zones or borders with your home country. From a U.S.-based perspective, the nearshore region includes Central America, South America, the Caribbean, Mexico, and Canada.
The nearshore software development industry is comprised of hundreds of software development companies headquartered in these nearshore countries. Organizations in the U.S. will partner with these companies to outsource software development projects, a practice known as ‘nearshoring’. The industry continues to grow as more companies in the United States begin to recognize the benefits of nearshoring and its capacity for disruptive innovation.
Why Partner with a Nearshore Organization?
There are many reasons why nearshore development partnerships are attractive to organizations based in the United States. Some of the most impactful benefits of nearshoring are:
- Access to world-class engineering talent
- Time zone alignment
- Deep cultural affinity with the United States
- Attractive price point compared to domestic providers
- Added-value partnerships
Availability of Talent
Nearshore countries have been building strong foundations in the software engineering industry for decades to support the rapidly increasing global demand for digital products. The region has been cultivating and educating software engineers, operations specialists, data scientists, and more thus increasing the number of science and technology graduates each year. For example, Colombia graduates approximately 13,000 software development students each year. Strong English language skills combined with world-class engineering talent yield deep talent pools on par with Silicon Valley.
Time Zone Alignment
Real-time communication bolsters the agile capabilities of the development team and is critical to the success of the software development process. Nearshore companies operate at virtually the same hours as their U.S. clients, allowing project-related discussions to occur in real time. For example, Colombia aligns with U.S. Eastern Time for half of the year and Central Time for the other half, depending on daylight savings. Pacific Time is only a few hours behind most Latin American countries, mirroring the difference with the East Coast of the United States.
Companies that work closely with their outsourced teams in an agile environment will achieve the best results. Similar time zones enable true agility and real-time communication for internal and third-party development teams.
Nearshore development companies have built a strong cultural affinity with the United States through decades of partnerships with U.S.-based clients. Most nearshore partners possess the same work ethic as their customers in addition to a strong understanding of what is expected of them.
Cultural compatibility is particularly important when it comes to selecting a nearshore development team. For example, Latin American culture emphasizes creativity and direct communication. These values regularly lead to impressive innovations and strong partnerships with clients. Lower instances of cultural misunderstandings, combined with strong English language skills, yield faster development times, improved risk management, and increased quality of deliverables.
Attractive Price Point
Lower operating costs are one of the primary reasons that organizations partner with nearshore companies for software development projects. The strength of the U.S. dollar compared to local currencies and lower costs of living in Latin American countries cause the average wages for programmers and developers to be significantly lower than domestic wages. Companies partnering with trusted nearshore outsourcing partners get more for less without sacrificing quality. This in turn yields faster deployment timelines with new software products, giving companies an advantage in competitive marketplaces.
Added Value Partnerships
Nearshore delivery is often inaccurately viewed as a compromise driven solely by cost reduction that comes at the expense of quality. If you are only looking at price or technical skillsets, then you are only focusing on short-term solutions versus building a long-term strategic partnership. There is nothing inherently wrong with this approach, but it eliminates opportunities for additional value and increases risks associated with the project.
Beyond bringing ideas around methodology, processes, and people, partnering with a global consulting firm brings additional value to your organization. Some examples of these added benefits include industry insights from research, executive thought leadership, technical innovation trends with up-and-coming technologies, and strong partner relationships with industry-leading vendors. The long-term gains that come from a trusted, professional global software development partnership are far more beneficial to your success than simply a low price point.
Nearshore software development is a powerful solution to accelerate digital transformation initiatives. Companies who understand the clear advantage of tapping into global resources are the ones that emerge as industry leaders in their respective markets.
The high-caliber bilingual teams at Perficient Latin America are proactive, not just meeting the bare minimum requirements, but engaging throughout the process and working to take our clients to the next level. Our teams become an extension of our clients’ teams, creating valuable long-term partnerships.