Offshore Software Development: Latin America’s Growing Role in 2024

In software engineering, offshore software development is a clever solution to meeting the business needs of your organization. Sometimes what’s right in front of you isn’t always the right answer, and that’s okay.

When people think about software development they think of some big names who all fall into a certain image. This image isn’t bad, per se, but software development transcends this image, especially in the context of offshore software development.

For instance, just about everyone knows about Silicon Valley, but do you know about India, Ukraine, or even Brazil? Probably not. But you’re going to learn all about it.

The rise in collaborative software development and building trust in software partnerships are among the many key factors driving offshore development in countries like Latin America. It has also been largely successful, provided that effective client communication is in place.

To find out more about how offshore software development can help your business, stick around. The following information will acquaint you with the essentials of offshore software development.

What Is Offshore Software Development?

Offshore software development describes when a software development process takes place outside of the benefacting business party’s country of residence. This is closely related and often synonymous with outsourcing, which refers to obtaining goods or services from third-party providers that are not internally staffed.  

You’re surely familiar with other types of outsourcing. Globalization warrants that business happens in a global economy.

As an illustration, while the American Steve Jobs and his software development team take the credit for the invention of the iPhone and iOS in general, there is virtually no time in history where the mass production of iPhone smartphones did not involve manufacturing all over the world.

The iPhone’s batteries — although some find this hard to believe — are manufactured by Samsung in North Korea as is its flash memory.

Their networking chips come from Qualcomm which is based in the U.S. but has dozens of international locations, including countries like Australia and Japan.

Even the assembly of all these globally manufactured parts occurs in Taiwan, with Foxconn and Pegatron being the leading companies for component assembly.

All that said, iPhone and Apple, Inc. are still American products.

Offshore software development is outsourcing too, but the other way around. That is, the internal substructure and integrity of your company can and should remain intact.

But when it comes to software development and building software applications for your own or your customers’ consumption, looking abroad is often the optimal way to go.

 

It is important to note that, just like with any other for of outsourcing, transparent project management practices such as clear communication and transparency are essential fore reducing risk, and ensuring successful offshore collaborations.

What Are the Benefits of Offshore Software Development?

There are many benefits to offshore software development. Much of these benefits simply cannot be achieved with onshore development. Here are some of those advantages.

Reduced Costs

In-house custom software development can be both expensive and tricky. Payroll procedures are timely and require a specialized and salaried human resources specialist. Management overhead is similarly budget-busting.

Also, modern times are seeing a digital transformation and many companies can go completely remote.

These businesses can save thousands if not hundreds of thousands of dollars by outsourcing their information technology (IT) and software development needs that would otherwise rely on costly infrastructure.

Outsourcing in general is cheaper than servicing projects close to home as the cost of living in popular countries for outsourcing is typically lower.

However, with transparent project management, outsourcing can be even more cost-effective as miscommunications and project delays are avoided.

Ease of Hiring

Besides costs — though it’s important to note that the average cost of hiring was over $4000 in 2016 — offshore software development promotes hiring efficiency. Hiring, in general, can be burdensome.

It can take over a month to find new employees which make your business vulnerable in the interim. But hiring software developers, in particular, involves additional risk.

Software development is technical expertise and to some extent, you need experts to be able to find experts. And frankly, not everyone is an expert, and hiring software developers on your own could require a lot of research.

However, offshore teams often come with effective client communication strategies, which make onboarding easier and smoother.

Guaranteed Quality

Likewise, offshore development teams can guarantee quality. Offshore software developers are usually part of software development outsourcing agencies with thorough hiring practices.

These agencies recruit developers via intensive vetting and screening processes such as coding challenges with real-life applications.

By prioritizing long-term client satisfaction, these reliable offshore agencies build trust in software partnerships.

Increased Scalability

Taking all this into account, small and medium-sized businesses (SMBs), as well as tech startups that want to scale, can make great use of offshore software development.

Lower costs combined with objectively skilled talent is not a bad deal at all. SMBs and startups, almost by definition, work with more restrictive budgets.

Outsourcing development to Latin America is a financially savvy decision that will also result in business growth down the line.

Additionally, scalability is supported through collaborative software development, where both offshore and in-house teams work seamlessly together using things like agile methodologies.

 

Why Should Companies Use Offshore Software Development?

The most obvious reason to use offshore software development is to stay within budget while qualified developers complete your project. But outsourcing your software development can be a strategic move for other circumstances too.

To Reduce Risk

The software development process is a demanding one. It deserves your undivided attention. Of course, your attention is probably already focused on day-to-day business operations.

Offshore software development is a convenient way to mitigate any liabilities that could occur if your in-house team is non-existent or not up to par with the certain technologies you need for your software development project.

However, effective client communication is critical to reducing risk in the development process and needs to be one of your primary focuses.

To Speed Up Time-To-Market (TTM)

Rushing development is not exactly a good thing. But if you have a software development team that just happens to be fast and efficient, this is definitely a positive.

TTM is critical when launching a software product. Some of the biggest comforts of an accelerated TTM is a competitive advantage in the market as well as a timelier return on investment for your software product.

By avoiding the trials and tribulations of hiring your own software developers, you can advance your project quicker and risk mitigation will double that effect.

If you already have a team of developers, but find that you are just not getting your product out as quickly as you would like, collaborative software development between in-house and offshore teams also accelerates delivery times.

To Take Advantage of The Most Current & Trusted Technologies

As established, outsourcing agencies for software development are expected to be reliable and thus must have the tools for development that are most effective. Using offshore software development allows you to take advantage of this tooling.

To Ensure Flexibility

Companies that use offshore software development have the natural advantage of additional flexibility in their workforce.

Flexibility in this regard refers to deciding whether you want developers long-term or short-term or whether you need a full team of developers for a certain project or for a few stray developers to integrate seamlessly with your in-house software development team.

How To Succeed With Offshore Software Development

To make certain that your software development project is successful using the helping hand of offshore software development, you will have to consider numerous factors carefully.

Location

As mentioned, Asian countries are customarily what tech companies look to when they want to do software development abroad. This is for good reason; you can find lots of talent in that region.

But other regions offer different advantages so make sure to do your research. South America and Eastern Europe are up-and-coming regions for offshore software development. 

Price

Most businesses decided to use offshore software development for budget reasons. However, just because cost is a concern does not mean it should be a determining factor in your decision.

You know this line: ‘you get what you pay for’. Look for reasonable, not dirt cheap prices when choosing the software development agency you want to work with.

Talent

The success of your software development project is directly tied to the skill of your developers. Be on the lookout for developers who share the competencies that your project requires.

On top of technical skills, remember to scrutinize your candidates well to verify that they have the key soft skills necessary to work collaboratively on a project. This skill set can range from communication skills to problem-solving skills.

Soft skills such as strong communication skills are particularly important for effective client communication and to ensure successful collaboration with offshore teams.

Security

You’re not wrong to be worried about the security risks of outsourcing your software development project. Thankfully, you can negotiate with potential partners before signing any contract, and make your concerns a high priority.

Trust

It is incredibly important to build trust in software partnerships.

Trust forms the foundation of any long-term offshore relationships. To build trust, make sure that you focus on keeping communication channels open and sharing as much information as possible.

Offshore Software Development in Latin America

Offshore development is used as a catch-all for any type of development that is not onshore or in the primary location of the business that uses offshore developers.

But the term nearshore development points to countries that are close to a given business’s base — such as if a U. S. company uses Brazilian developers, for example.

Though in the past, India, China, and other Asian countries were top dogs in the offshore software development industry, as of late many have directed their attention to Latin America.

Latin and/or South American countries have done their due diligence where offshore software development is a concern. There is no doubt that the region demonstrates talent in this field.

Transparent project management has become a priority for Latin American offshore companies, contributing to their rising reputation. This has led to them fostering collaborative software development and ensuring mutual trust.

Why Outsource to South America?

Brazil and Colombia are leading countries for students to seek out an education in IT or software development.

Argentina and Nicaragua show great and tangible enthusiasm for developing the overall English skills of the general population.

In 2019, Brazil was ranked first for software outsourcing in the Latin American region and 13^th in the world.

National and government-sponsored initiatives by several South American governments have driven the region’s success in the software development industry even more.

The other advantage of basing your offshore software development in Latin America, particularly for tech companies that are based in the United States, is that you will share closer time zones.

It should be no surprise that time differences can interfere with work productively. For most people, just watching somebody take a call at three in the morning because they work with an international client feels tiring.

If there is only a small difference in time zones between areas — or in some cases, no difference at all — finding mutually agreeable schedules that do not leave anyone exhausted will not be so difficult.

To add, countries that would fall under nearshore outsourcing from the perspective of the United States tend to prioritize English fluency within their borders.

Outsourcing to Latin America has gained noticeable credibility for these reasons. Choosing to utilize offshore software development in Latin America can be a smart choice for many businesses. 

Conclusion

Offshore software development presents a linear model for scaling your business and solving a number of issues you may be experiencing relating to budget, expertise, time constraints, and more.

Trio is an offshore software development company based in Latin America. Trio developers are both eager and skilled to work with international businesses and manifest their software development ideas in real-time.

Along with technical expertise, we focus on effective client communication, transparent project management, and building trust in software partnerships, which are key to making offshore development in Latin America a winning strategy.

Contact Trio to hire qualified software development professionals for your next project!