Willing to outsource web development but unsure if it is worth it?
Look at this: Google AdWords, a product that brings the lion’s share of Google’s 305.63bn USD revenue, has been developed by outsourcing teams.
It’s not just Google.
Facebook, GitHub, Alibaba, Boeing and even Ashton Kutcher: they all outsource web and software development to third parties. Some of them shine. Some fail. In this article, we’ll check why.
We will carefully describe the joys and horrors of outsourcing, consider some common pitfalls, and explain why outsourcing development to Costa Rica is a wise decision.
You’ll discover:
- Top reasons to outsource web development
- Five steps to select an offshore web development team successfully
- Advice on how to avoid general pitfalls of outsourcing
- Key factors that make Costa Rica a great outsourcing destination.
The Reasons to Outsource Software Development
Cost, time, and the right people: these are the main reasons why people choose offshore web development. Let’s review them closer:
- Cost saving
Outsource web development saves costs for numerous reasons. You don’t build infrastructure. You don’t train the team on the in-house policies. You don’t spend money on bonuses, vacation, medical plans, et. Moreover, teams offering offshore web development have lower rates.
For example, according to Glassdoor, a software engineer in the US earns an average salary of $134,681 to $150,841 per year. Comparably, if you decide to outsource development to Costa Rica, an average salary of a software engineer there is in $31, 215 per year.
Cost saving is the main reason why Apple outsourced manufacturing to China and software development to Indian companies like Infosys and Wipro. Google outsourced IT infrastructure management and software development to India for the sake of cost as well.
- Flexibility
Covering urgent needs in staff augmentation is also one of the main reasons why people outsource web development.
Offshore web development helps you adapt to market turbulence, staggering new trends, and competitor moves. Google reports that covering spikes in work is one of the main reasons to seek outsourcing options.
- Faster time to market
In terms of project lifecycle, offshore web development gives you two important advantages: you skip onboarding hustle and have a team loaded with the necessary experience to execute your idea. This saves up time otherwise wasted on organizational routines.
If you are located in the United States and
- Talent
One of the biggest issues with hiring talented people in-house is that they often work for someone else. When you outsource web development, you skip luring talents with benefits to join your company but simply enter the market where they are ready to help you and can offer a structured collaboration plan.
Finding talent was one of the main reasons why Facebook expanded outsourcing efforts in 2021. As it was reported by vice president of global recruiting Miranda Kalinowski, the main aim for the company was to tap into a diverse talent pool of the main engineering cities and to recruit alumni from top computer science programs.
Offshore development in Costa Rica is quite popular due to the high concentration of experts with rich technical skills and experience.
Outsourcing Pitfalls: Why Outsourcing Should Be Approached with Care
Despite obvious benefits, like those described above, outsourcing web and software development may turn into a real disaster, or even tragedy, like I was with the Boeing 737 Max aircraft. Several years ago, Boeing jets crashed due to software issues. The world’s largest media outlets, like Bloomberg and Forbes, buzzed with headlines like “Boeing’s 737 Max Software Outsourced to $9-an-Hour Engineers.” That was a major blow to the reputation of Boeing and the outsourcing concept in General. So, what were Boeing’s outsourcing mistakes:
- Lack of experience: Boeing hired teams that had no experience in aerospace
- Rush: the team was rushed to develop the code faster to avoid costly launch delays
- Lack of oversight: the accepted code contained a lot of mistakes
- Poor communication: one of Boeing’s engineers said that they had to send one and the same task to a team in Russia 18 times before they understood what to do.
Although avoiding this pitfall looks like the ABC, as we see even tech moguls are not immune to routine mistakes. Therefore, starting an outsourcing project should be approached with care. It’s easy, if you know what to focus on.
5 Steps to Select an Offshore Web Development Team
The offshore development process can be roughly split into five steps: company research and interviewing, negotiations and signing agreements, development rounds, launch, and feedback.
To put it simply, it starts with a thorough search and ends with careful oversight. Here are five tips to consider for outsourcing web development wisely:
- Select a team
As you’ve probably understood, selecting a team that is capable of or has experience in doing a specific task in you niche is most important. Go to resources that provide honest reviews on software providers.
This is how you can find the right offshore software development company if you decide to outsource development to Costa Rica:
- For companies with proven reviews, go to Clutch, Goodfirms, or Glassdoor. These international platforms tend to reflect most popular and reliable option. But you can still miss a talent you need.
- So, for a wider selection go to Upwork or LinkedIn. There you can find those who didn’t get into Clutch of Glassdoor list for some reason.
- You may also go to local job fairs (need help here).
After checking reviews, portfolios, references, and expertise, you run interviews and learn more about your options.
- Choose the outsourcing model that best fits your needs
When it comes to actual outsourced web development, you can select from several collaborative models: staff augmentation (link to the service), hiring a dedicated team (link to the service), or solo freelancers.
With staff augmentation you hire the missing puzzles to your team. As you hire a dedicated team it’s like you extend your company for a small (or big) department for the project’s time being. Any of these should be discussed and described in your contract down to details.
- Establish regular communication, but don’t push to the limits
It’s hard to keep a balance between effective communication and annoying micro-management. So, regular advice like “set a daily call” is not applicable to everyone. The unaccountable human factor or “gut feel” plays a crucial role here, and the ones who master it with perfection will do best.
Interesting fact: According to Harvard Business Review, intuition is a powerful form of pattern recognition, a thing we still dream to teach highly effective AI models to do.
Anyways, with apps like Skype, Coogle Chat, Slack, Jira, Upwork, etc. you have numerous ways to establish comfortable communication mode with your team.
- Provide timely feedback personally or assign someone to do it on demand
Having a person in place to review the deliverables and share opinions in time is a must for any outsourced web development project. Often, project executives underestimate this factor, leaving reviews to the end of the week or skipping them. That hinders the process or may lead it in the wrong direction.
- Have the right people in place to monitor success.
Success monitoring allows for early bottleneck detection. As not a single project is 100% successful from the first time, the earlier you spot wrong paths, the better. Extra investment in the expertise from the side of your company will be needed. Avoiding this was, actually, one of the main reasons for Boeing’s issues. At some point, the company cut spending on qualified in-house engineers too much.
Why Are Companies Outsourcing to Costa Rica?
Costa Rica is a small but innovative country with very favorable conditions for outsourcing web development.
With just 155 information technology companies, the country is one of Latin America’s leaders in offshore web development. According to the Global Innovation Index, the country is the seventh in the region as the most innovative country, following Argentina (number six, which has 435 companies). Yet, in 2021, Costa Rica was the third most innovative country in the region after Chile and Mexico.
Among the top reasons why offshore development in Costa Rica is a smart thing are:
- Political stability: Costa Rica is ranked 36th by favorable policies for leading business and has 42nd place in the world by following the rule of law.
- Education: The country is 10th in the world in terms of expenditure on education.
- Technology: Costa Rica is ranked 7th in the world for online creativity and had first place in the category “Mobile app creation” in the Global Innovation Index 2022 report.
- Business: The country is ranked 13th for the number of companies with ISO 9001 quality certificates and has the eighth position in the world for favorable conditions for new business.
With these indicators and almost 50K talented software developers Costa Rica is one of most attractive places to outsource web development.
Summing up
Offshore development in Costa Rica is an attractive option for numerous businesses worldwide, especially those headquartered in the same time zone. Favorable legal, educational, and economic conditions provide for a huge talent pool of highly qualified specializing in outsourcing web development, application development, design, IT infrastructure, machine learning, and artificial intelligence.