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Offshore Development Center: Why do you Need one & How to Build one

Published: March 31, 2021
Offshore Development Team

Principles, Definitions and Ideas behind getting ahead with Offshore software solutions

Increase in Demand for Talent and Software Professionals + Cut-throat
Post-Pandemic Competition = No Geo-specific Boundary.

With the increase in the demand for software development globally, Offshore Software Development Centers (ODCs) have sprung up in recent years helping enterprises and startups work with elite developer teams across the globe.

If you work in the IT field, the term “Offshore Software Development center” is probably not strange to you. You might even be aware of the project outsourcing by FANG companies or the likes of it – whether it be for software creation, feature addition, or maintenance projects and tasks.

These centers are becoming the preferred choice for every software-centric business – start-ups, SMEs, or established enterprises – perhaps because of their myriad benefits and practical utility.

But before we even talk about setting up an ODC, let’s consider the basics first.

What is an Offshore Development Center?

An Offshore Development Center (ODC) is an Development Office group offering convenience of talent, resources, access, and software solutions.

An ODC essentially offers programming services to clients – the proviso being the development center’s location being off-shore, that is in a different country or continent.

Basically, it is an auxiliary of an organization that works in another country. The country where the ODC is located generally has a much lower average cost for development than where the HQ of the organization is.

In any case, it is fundamental that an ODC has assets and resources accessible for the organization’s needs and requirements pertaining to software development and management.

On those lines the offshore development center includes a team of experts to minimize liability. The usual roster consists of –

  • Software engineers
  • QA engineers
  • Back-end developers
  • Front-end developers
  • Web designers
  • UX designers
  • Project Manager / Team Lead

Besides, ODC has its high-level gear, skill pool, and the basis of management which kickstarts the software development cycle while keeping the pace and quality in check.

Why would firms and global tech organizations opt for an Offshore Development Center?

The initial need to work with an offshore team is to save on costs and efforts with a quality-driven software product. #offshoredevelopmentcenter #hireoffshoredeveloper Click To Tweet

Let us have a look at the nuances of an ODC and why they are becoming a favorite with organizations –

Why Do Businesses Need an Offshore Development Center (ODC)?

It is sensible to accept that every big or small organization would need to save money on costs to boost benefits. In addition, they require talent. Preferably talent that is experienced and useful.

Companies are incentivized to build faster, cheaper without the usual risks associated with attrition, and hiring.

That’s why there’s a need to set up offshore development centers. The start-ups, SMEs, and established businesses have started realizing the importance of setting up an ODC that helps them enhance their work efficiency, reduce their time-to-market/ship, and help them develop products, while they can focus on their core business initiatives, strategy or product vision.

Developer pool in an ODC helps lower costs for development services, and allows enterprises to save funds in recruiting, training, accounting, HR, and office budgets. The idea seems to hold true for startups as well – bootstrapped or funded – as they buy-in to the idea of an ODC solving their crucial development needs.

Saving money on costs, however, isn’t the only explanation concerning why one may see it fit to set up an Offshore Development Center.

It might be likely that the assets, skills or abilities you require are simpler to discover and affordable to hire in a different country. This aspect is something that hundreds of enterprises explored in 2000s and 2010s with Indian firms – a trend now picking up in LatAm and Eastern Europe. Offshoring often helps make it simpler for you to hire that Elite talent that is absent or all too expensive in your own geography.

Having your Offshore Development Center situated in a country with an extraordinary talent pool will make it easier for you to expand your team size and hold your product/software development pace without the hassle of hiring, building, and training new developers. An additional benefit is that of not facing a talent crunch in your location.

Expertise deficiency influences organizations. In any case, your ODC will have you covered at the Talent end.

Let’s take a quick recap of the key benefits

Key Benefits

  • Cost Effective – On all fronts
  • Access to Talent
  • Reliable Operations and Delivery
  • Scaling or Churning Teams and Operations on-demand
  • Shorter Release Cycles
  • Better Focus on Vision and Strategy
Continuous communication to establish clear, effective, & long-lasting relationships is what every offshore development center aims for! #offshoredevelopmentcenter #offshoredeveloper Click To Tweet
Offshore Development Centre

How to Set Up A Successful Offshore Development Centers

Now that you know why ODC might be a better alternative for your business, let’s understand how to set up an offshore development center.

Clarification of Needs

While building a dedicated offshore development center, make sure that the service provider has a clear understanding of your business goals. They must list down the product ideas, flesh out the essential inputs, and understand the talent needed for the software/tech requirements.

After a thorough project session and brainstorming on this, the ODC agency must share a detailed vision of the future product they will develop to ensure that they are on the right track.

That could include interacting with your business leads, or tech leads; setting up milestones for delivery and creating a requirement analysis sheet that highlights points of progress.

Here is an exhaustive list of questions that ODC agencies must regard before developing the software solution –

  • What issues will they resolve?
  • What are the things or features they will in-built?
  • What type of partnership do they need to pick?
  • What is the budget, and how much time they’ll take to develop?
  • What level of control to have in the future?
  • What type of model or engagement setup to select (by you – BOT (Build Operate Transfer)or by partner – FTE (Full Time Equivalent))?
  • What solutions will you provide to customers to achieve a great result?

Well-defined business goals give you a better understanding of which offshore development center model to choose that is within your budget to allocate to this project.

Choose the Exact Location

Select the preferred location thoroughly where vendors understand the cultural & language characteristics and the technical skills required for your product. The destinations worth considering for offshoring are Latin America, Eastern Europe, and Asia – with Poland and Ukraine being big players in Easter Europe and India being the absolute giant in Asia.

While choosing a location for an offshore country, also vett the vendors’ expertise so that you decide what fits best to your specific project or business requirements.

Research for A Good Vendor

Not every vendor needs to live up to your expectations for developing a software product. This is why you need to use an experienced provider with this particular service to save time, cost, and effort. Here are the things that you consider:

1. Technical Expertise: When looking for a good offshore development firm, consider their portfolio, testimonials, industry expertise, fluency in the English language to check how well-versed they are while handling the project deliverables and client communication.

a. Also try to understand their talent profiles and the kind of resources they offer you.

2. Cost flexibility: Pay only for the services for which you’ve hired the offshore development center. Ensure you receive an invoice with transparent costing and a detailed description of individuals and the work done. The project budget mainly includes the team size, skill set, expertise, and complexity of the project/task.

3. Project Transparency: Definitive project management with proper communication channels and protocols + precise updates and challenges must be a part of their pitch and methodology.

4. Process Orientation: Diligently vett their processes, the attention to detail, the thoroughness with requirements and the output planned.

5. Security Tenets and agreements: Understand and vett the IP rights, the agreement terms and conditions, authorization, security terms and infrastructure.

Ability to Attract Local Talent

The key to the successful development of an offshore development center is to attract and engage developers in your area of interest. In this way, you get a dedicated offshore team that has a deep understanding of your target audience in terms of cultural and social details.

Where does Netsmartz factor in?

An Offshore Development service that offers Pre-Vetted Talent On-demand.

That is where Netsmartz excels and offers an advantage over other run-of-the-mill services across the globe.

Netsmartz is an IT company with 8 Global campuses and more than 20 years of experience in helping startups and enterprises set up Offshore Teams, Hire remote engineers and work with the Top 2% Engineering Talent.

Whether you are looking to hire an offshore developer or a team, we ensure immediate access to resource/s dedicated to your software project or task requirement.

Why set up an ODC with us?

  • Save up to 72% in costs
  • No long term contracts or limitations
  • Agile Development Teams with Experienced Developers and Engineers
  • Immediate availability of resources on any tech stack
  • Dedicated development team comprising of Certified Resources

To boot, we also offer Free Consultation and a No-Risk Onboarding for 40 Hours for you to experience our services and explore the Netsmartz advantage!


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