Building an offshore development team in another country is like a double-edged sword. On one side, there’s a whole load of benefits, from competitive prices to impressive skill sets.
On the other side, there’s a question of trust, which is a key factor in building fruitful cooperation between the headquarters and the dedicated development team. All of us have heard horror stories by frustrated clients that tried to open an offshore development center in another country but failed. In this article, we will elaborate on the reasons why it’s hard to build trust when working with an offshore development team and give some solutions to this problem.
Risky Advantages of Offshore Teams
So, if you have decided to hire a development team from overseas, be aware of the following “double-edged” benefits:
Relatively low prices
The main reason why companies choose to outsource software development services is the low cost of those services in offshore countries. However, in countries such as India or the Philippines low prices typically mean the poor quality of code.
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In addition, it’s hard to communicate with developers from those countries because of cultural differences: they can be afraid to tell the main office about the issues just to avoid confrontation. A possible solution here is to hire developers from Eastern Europe. They’ll charge you slightly more than their counterparts in Asia, but you’ll get good quality at a reasonable price.
Big talent pool
There are over 1 million offshore software developers in the world, but such a large number is rather a disadvantage. This is because you may spend lots of time trying to choose the team that perfectly fits your project. A solution here can be to hire a local recruiter to do this job on your behalf.
Time zone differences
It can be both an advantage and disadvantage, depending on the chosen offshore location. For example, the US is ahead of Asian countries in terms of time zones, so it means that they have to wait until the offshore developers wake up, and there is almost no overlap in time. On the contrary, the Eastern European countries are ahead of the US, so they have already worked half of the day when you wake up, and you still have several hours of overlap for the rest of the day.
Why You Can’t Trust Your Offshore Team
In addition to the problems described above, here are the key trust issues that you should know about if you decide to hire a development team from overseas:
Lack of personal communication
Offshore team management may involve a local project manager who acts as a mediator between the head office and offshore team. In such a way they try to avoid communication issues instead of solving them. We recommend finding out if you can personally communicate with your team. If not, better stay away from such vendors.
Risky financial transactions
Money transfers between the onshore and offshore offices can lack transparency in many cases. Invoices from some countries may not be accepted by tax authorities because of invoice falsification risks.
In addition, you will need to make sure that the company clearly identifies itself during the financial transactions and that this legal entity actually exists. A solution can be to interact with your team via a secure online platform and make payments through it.
Some companies may have high ratings on websites such as Clutch.co and thus look trustworthy. However, keep in mind that service providers at Clutch can sponsor this website and thus get high ratings for that. Besides, a benefit for one company can be a “poison” for another company, as each project has different requirements.
These were the trust issues that you may experience when working with an offshore development team. We recommend being very careful and considering all of these issues when deciding to hire a development team outside your country.