Out of a need for quick expansion or better access to talent, US-based companies have shifted from a local to a nearshore mindset in order to reach top talent. The way we develop software around the world has completely changed in just a few short years.
Offshoring by no means is a new practice; it has been around basically since the internet started. A recent trend for US-based companies has been a shift from offshoring to nearshoring.
Offshoring? Nearshoring?
Both terms refer to the practice of outsourcing your team somewhere else, for many different reasons:
- Lack of local talent
- Access to specialized talent
- The need to augment fast
- Location & infrastructure needs
- Reduction in staffing costs
- and many more…
The main difference is the time zone and culture. When you offshore, you hire a team somewhere in the world in a far-off time zone. By nearshoring, however, you hire as close as possible and in your time zone. In this case, US-based companies are hiring engineers in Latin America and LatAm for nearshoring.
For Ideaware, the biggest pain points we help our US-based customers with are: Quality, same time zone, similar culture and geographical location (being a few hours away by plane) and reduced costs.
These are the reasons why I believe nearshoring will overtake offshoring.
For the past 4 years (since we transitioned from agency to nearshore team model servicing US-based companies) I’ve seen many trends come and go, but some are here to stay:
High demand and limited talent pools are driving US-based companies to find nearshore teams
Local talent pools are usually overshadowed by rising demand. This means US-based companies are finding it hard to source local talent to meet their needs. This is currently driving US-based companies to evaluate other options like offshoring & nearshoring their teams in other regions like Latin America.
Companies will transition to consider their nearshore teams as their own
One of the biggest concerns we see our US-based clients have when working with a dev shop or agency is that they have to adopt another’s processes to produce THEIR results. This just introduces more friction all around.
Our US nearshore teams, on the other hand, are no longer “developers-for-rent” by the hour. They are full time-dedicated individuals that you can consider as part of your own team.
These teams share the vision, take in the culture, and adopt processes to deliver results.
The shift from offshoring to nearshoring will continue
Same time zone? Check. Similar culture? Check. Easy travel? Check. Quality? Check. Better rates? Check.
It’s definitely a no-brainer for many US-based companies and startups to shift to a location easier to work with and access. I’ve been seeing this trend over the last few years with our clients and I strongly believe many more US-based companies will shift to nearshoring in 2020 and beyond. We are uniquely positioned to continue supporting these companies as we have since 2010.
A more specialized nearshore provider market
Nearshore team providers will keep specializing in 2020. You will be able to find providers that specialize in specific frameworks, technologies, blockchain or AI.
There are two reasons for this specialization: first, the more talent you have specialized in a specific field, the easier it is to attract, train and retain said talent. Second, it is good business to establish yourself as an expert in a field (by acquiring the experience) and then offer services to your target market.
Jack-of-all-trades service companies and agencies are (still) on decline. Ideaware has been this type of partner for US-based clients such as bucket.io and curb.com.
Hands-off team management
Providers (like us) are taking the nearshore model a step forward by providing 100% hands-off team management. This means you don’t need to worry about HR, office, management, retention, etc. Ideaware handles all of the administrative responsibilities so you can focus on development performance.
Focus on your product while everything else is taken care of.
High quality over cost
Most of the time, the cost-benefit of hiring an offshore team had a big drawback: quality. Your team might be cheaper than hiring in-house, but at the cost that you don’t get the best talent and have sleepless nights.
Some offshore/nearshore companies can provide cost savings by offering junior-level candidates who are then sold to you (unknowingly) as more experienced developers. These types of teams lack the expertise to produce a high-quality product released on time.
At Ideaware, we are very transparent about the individual team members we are bringing to the table. We involve our customers as part of the interview/selection process. We are about the success of our US-based clients because this is our barometer of success. We are successful if they are successful.
This transparent process ensures you get the experienced talent you need to execute your vision.
As the globalization trend continues, it will become necessary to work with nearshore teams. Improved communications, tools, and processes keep making remote work better.
Why Ideaware?
Since 2010, we’ve helped US companies scale with top-tier tech talent, not just by filling roles, but by becoming long-term partners in growth.
- We handle sourcing, hiring, onboarding, and retention.
- Start receiving CVs as soon as 48 hours.
- You could meet your new teammate in as little as 8–12 days.
- Our retention rates are 2x the industry average.
Contact us here to discuss your hiring strategy, and we will get in touch with you within 24 hours or less.
