Top 7 Common myths and misperceptions about Nearshoring in Western Europe

Serengeti

Business

03.10.2019.

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When organizations first learn about nearshoring -- the concept of getting development work done in a neighboring country instead of your own country, or within your own team -- there are traditionally a number of myths and concerns that come up first. To see the value in outsourcing development work, you need to understand the misperceptions and then be able to counter them. This is a guide to doing just that.

Misperception 1: Your local market

This is usually the first misperception that a company will have. They will think: “Well, if we recruit strategically and use tech platforms for recruiting, we can find the people we need locally.” This is sometimes true in larger cities, but not even always there. In smaller cities, it’s very rarely true. The best developers, engineers, and IT professionals almost always end up in bigger cities, because their career opportunities are bigger there. In a smaller city, you will not find the talent you need to compete with organizations in those bigger cities. 

Misperception 2: The language barrier

An organization needs extra developers. But when they first consider nearshoring options, they are afraid of a language barrier. They look at our services, for example, and assume we will bring in German-speaking developers and there will be too much chaos in terms of melding the teams. That’s actually not true. First of all, English is the universal language of tech and coding. We’ve worked with dozens of clients where their base work language might have been German, but the task work was given out in English. There is no complexity added and no true language barrier.

Misperception 3: There will be an additional burden

Your in-house technical team is busy. If you add outsourced developers, does the in-house team now have to tell them what to do and correct their work? Won’t that make them busier? Aren’t you just adding more stress to the employees you already have? No. We actually use a Team Extension Model, which you can learn more about in this video. The idea is that we organize our team in the same way you organize your teams. Also we provide self-managed autonomous team that puts minimal overhead on your key people in the beginning and latter takes the overload. It makes the process seamless and reduces any confusion, friction, or potential burden.

Misperception 4: Delayed product launches

This takes two forms. The first form is that an organization keeps missing launch dates because it lacks certain in-house expertise to finish projects on time. If this keeps happening to you, you definitely need to outsource some of your development work. There is no question about it. You need a way to get the expertise that your product launches need without hiring for it, because to be honest, hiring is a gamble. What if the person doesn’t work out? What if they don’t have the skills they claim to have? What if they leave your organization quickly?

The second issue around delayed product launches is that sometimes, an organization worries that adding a nearshoring partner will add complexity -- see above with “additional burden” -- and thus delay their product launches even more. No. Because of the Team Extension Model, that doesn’t happen. The advantage of nearshoring, above all, is that you get the expertise you need to get to market when you need to be there. That is the main reason companies tend to end up nearshoring: faster, more efficient competition in the market.

Misperception 5: Planning for the future

This is a huge problem for many organizations. Let’s say they have three new projects in the pipeline, but no firm commitments. If all three become true business, they might need 10 developers. But if they go hire 10 developers and only 1 of the 3 becomes true business, now you have way too many developers -- so you either fire them, or keep them around in case new projects arise. But that might be six months, one year, etc. You need flexibility and scalability in your planning. If you take on a project, you need the ability to almost instantly have the right mix of developers for that project. The right nearshoring partner will rise to meet your capacity and expertise needs. 

Misperception 6: “I don’t need instant, I need to compete long-term”

Some organizations see nearshoring as a transaction. It is for an immediate need. They have a project they need completed, they outsource the tech work on that project, and then the relationship is over. That’s definitely one approach to nearshoring.

What you are seeing more and more is that small and mid-size companies want to compete long-term, so they need more knowledge around Internet of Things, cloud deployment, machine learning, and more. But … to hire an expert in these fields as a full-time employee is very expensive. They can’t afford it, but they don’t want to lag behind others who can afford world-class expertise as full-time hires. The good news is that you can use a nearshoring firm in this way. Basically, you use them as a consultant, on a long-term retainer, and then you get access to their expertise in different areas -- and they can still help you with the immediate projects that come up. In this way, you’re mixing short-term and long-term needs, which is good for your business.

Misperception 7: Self-doubt

What if an organization lacks key technical people internally? What if they don’t have a project manager (PM) or other roles that can guide and supervise the work? What if the organization is not mature enough to outsource work yet? That’s definitely a worthwhile concern. What we do to get around this is to develop mature onboarding and team management programs. We know that oftentimes, when you hire a nearshoring partner, you have an immediate project need that has to be accomplished for one of your clients. You don’t have time to waste. So as we built the Serengeti model, we wanted to make sure that we could onboard onto new teams really fast and efficiently. “Hit the ground running” is important. This way, if you lack key technical roles in your organization, we can still start getting the right work done immediately.

And now you --- >

What other questions or concerns do you have about nearshoring? We’d love to hear from you.

And in the meantime, you can download our checklist to selecting a nearshoring partner right here: