Reasons for Outsourcing IT Services
The standards of doing business have been turned upside down, and an ultimate risk five years ago nowadays is becoming ordinary. Today, a business manager shouldn’t necessarily work only with the onsite staff, as the possibilities the globalized world offers are infinite. A digital team from the other side of the world that works remotely now may bring even more value to your business than local teams. The question is whether the global outsourcing trends will work out for your business? Finding the right answer is impossible without doing little research. So good we’ve done it in this post, thus, you shouldn’t do anything except for following our investigation.
Contents:
- IT Outsourcing in Figures
- IT Outsourcing Types
- Top 5 Advantages of IT Outsourcing to Ukraine
- Collaboration with Remote Teams
- Advantages of IT Outsourcing to Jellyfish.tech Team
IT Outsourcing in Figures
What is outsourcing?
Outsourcing is still a contradictory practice of involving the third party into the completion of a set of tasks for a business. As practice shows, a wide range of jobs can be outsourced from separate front- or back-end tasks to application support.
How common this practice is?
The total revenue the outsourcing sector brings to the world varies from year to year. Despite a certain instability, you may track the progressive scaling of the industry:
According to Statista, the IT sector is the first to benefit from outsourced services. In 2017, 65 percent of all companies had hired the contractor(s) to outsource their projects, and these statistics continued to grow.
Speaking about IT outsourcing statistics of today, we’re supposed to turn to one of the recognized experts in this sector, leading research and advisory company Gartner. The worldwide IT spendings in 2019 from Gartner only confirms the continuous development of this sector, highlighting the increasing role of outsourcing:
| Spending | Growth (%) | |
| Communication Services | 1,442 | 1.2 |
| Data Center Systems | 195 | 1.6 |
| IT Services | 1,034 | 4.7 |
| Enterprise Software | 439 | 8.3 |
| Devices | 706 | 2.4 |
| Overall IT | 3,186 | 3.2 |
As you can tell, the key driver of overall IT spending is IT services, which considerable popularity primarily resulted from companies’ desire to cut costs through involving the third party in business analytics, consulting, web and mobile development services. To be precise, 46% of the enterprises put IT outsourcing on top of the most efficient cost-optimization strategies.
What are the prevailing IT functions to be outsourced?
Software application development and maintenance are ranked number first at the list of the most outsourced information technologies services. Why outsource the above-mentioned services? Frequently, a company requires only one app for its work with the option of further maintenance, in this case, outsourcing web development services and support will be the best solution. A business runner should not establish a whole department with all the related costs to create and maintain the product.
Why should I outsource my IT department?
The first factor to consider when making a decision is, of course, specific circumstances your business is in, your objectives and resources, as without due knowledge of your situation it’s almost impossible to answer whether outsourcing your IT department is a good idea or not. If you can’t assess the current situation yourself, IT consultants from Jellyfish.tech will deal with it to build a complete picture and recommend an effective solution based on our experience.
IT Outsourcing Types
After discovering a wonderful possibility to optimize a project’s budget by involving the third party into IT tasks completion, it’s necessary to sort out the types of outsourcing existing on the market.
Onshoring
Onshoring is actually outsourcing to the same country you’re located in. Although this practice doesn’t provide cutting the costs, it helps avoid the risks connected to the language barrier, mentalities difference, and taxing policies. Investing in the economy of an own country is another benefit onshoring provides.
Nearshoring
Nearshoring includes cooperation with the teams from nearly located countries (often neighboring) that opens the possibility of face-to-face meetings (at least a few times during the project’s lifecycle) that, in its turn, builds the foundations of a better understanding between the parties. Another argument in favor of nearshoring is the possibility to encourage your team by visiting them in a neighbor country or vice versa an invitation to visit your company. However, the statement that nearshoring contributes to cost reduction is under question, as in many cases it depends on your country and country of a contractor.
Offshoring
Offshoring. If your main objective is cutting the costs, offshoring or cooperation with vendors from distant countries is a win-win solution. On the one side, the rates are relatively low comparing to the rates in your own country due to economic reasons, on the other side, the competence of certain web developers in certain countries maintains the highest quality standards of the world.
Your outsourcing destination will depend on the objectives, your company’s pursuing. If your main goal is cutting costs (as it is for the majority of businesses that practice outsourcing), offshoring is the best option that allows you to optimize your budget without compromising on the quality of web development and communication.
Top 5 Advantages of IT Outsourcing to Ukraine
The countries of Eastern Europe are famous for strong developers and talented designers, for our ability to think and share ideas and concepts to improve the overall customer’s strategy, for our flexibility and reliability. And Ukraine is one of the best IT outsourcing destinations for the moment with dozens of powerful teams mostly offering a world of possibilities to a client:
- Costs reduction. Ukrainian outsourcing sector provides clients with strongly qualified teams including web and mobile developers, project managers, QA, DevOps (all you need to get a successful project) at a lower rate than in the US, UK, and Western Europe. Outsourcing your IT department to Ukraine isn’t the cheapest option but this is exactly the difference between outsourcing to Ukraine and India/ Philippines/ Pakistan, etc. as in the first case, dev teams are able to produce really high-quality products due to their proven expertise, and in the second case, the majority of devs lack qualification to cope with a project successfully. Offering “the cheapest” IT services isn’t enough for us, we are aimed at implementing effective and profitable solutions to customer business not just writing code.
- Access to the Ukrainian talent market. In search of the vendors for a new project, you definitely want to reach out to the best specialists in this sphere. The more sophisticated technologies become in the course of an ever-changing digital environment, the harder it is to find the local specialist with the required expertise. The practice of outsourcing allows you to choose among the best without being limited to geographical location.
- High productivity. Having rich experience in developing a specific kind of product, the team you choose as your technical partner definitely has the advantage of speed. Moreover, the outsourcing team has already the experience of working together that increases its performance. Moreover, turning to the third party is a win-win decision when your IT specialist (or a team of specialists) has a high volume of work to perform. Outsourcing secondary tasks allows focusing on the essential objectives of a company as well, without getting distracted by small tasks, and, in addition, managing working time properly.
- Possibility to choose the expertise. In many cases, outsourcing is the best option for small or young startups & companies that either cannot afford or do not need to hire a single-discipline specialist to perform only one task at a certain stage of a company’s development. IT outsourcing to Ukraine allows a client to choose the team with the strongest expertise on the market supported by the relevant case studies from portfolio to get not only Python/ PHP/ JS code but a deep understanding of the specific industry and related business processes.
- Focus on core business. As project management of Ukrainian teams is kept up to the highest EU and US standards, a company has a chance to focus on its core activity without losing valuable human resources or hiring new ones while a dedicated team of developers will be working on the project. Of course, your engagement and control are still required, however, due to up-to-date and user-friendly reporting systems allows a business owner to track the processes effectively putting minimum time and effort provided that you’ve chosen the right company as a technical partner.
Being the inheritors of Soviet physics and math schools, Ukrainian programmers have a unique mindset fed by the natural curiosity and accessibility of higher education. In our professional hands, the code turns into the instrument of reaching your goal as well as the expertise that allows us to search for the best decisions.
Collaboration with Remote Teams
Considering outsourcing as an option, one of the main concerns lies in building an efficient communication between the remote team members. Unfortunately, today, even the local teams are forced to go remote for security purposes because of the COVID-19 rise.
In this situation, companies who specialize in providing the remote services have a certain “privilege”: they shouldn’t spend time & budget resources on setting up the processes from scratch as they’ve already done it. They’ve already gone through the trial and error method to find what works for them & their customers best, polishing their approach for years.
This experience results in a comprehensive methodology for remote workers communication with maximum efficiency.
Owing to the company’s activity, Jellyfish.tech knows for sure how to organize remote work in a better way. Our “must do” to streamline the processes are the following:
- Create a general-access knowledge base. Although every sphere will need a different set of tools, the main idea is the same: a well-structured knowledge base is a great time saver for remote workers. Of course, the initial training for employees to communicate the value of this system is highly welcome. Each employee should take personal responsibility for adding & updating the data, which can reduce the time spent on searching relevant information for other team members.
- Understand the value of instant communication. Corporate messengers are the cornerstone of real-time working communication. Even if the part of your team prefers face-to-face talk, the practice shows in many cases it would be quicker to solve the issue via slack or any other messaging tool than wait for a good time to talk. Besides, for many people of today, it’s much easier to write a few sentences in a chat than calling.
- Hold regular meetings. Meetings are the key to team cohesion during which both important and seemingly insignificant questions (which still influence team spirit, motivation, and performance of each worker) can be figured out. Here, we prefer using Scrum methodology with its stable and regular meetings structure and customize their frequency according to a specific objective. Eventually, meetings are also a way to help an employee stay in a team, working on the shared goals together and getting enough support from other team members.
- Reduce micromanagement. We are sure micromanagement inhibits the working processes, requiring an employee to wait for approval at different hierarchical levels. This system can’t help impeding the implementation of a solution significantly from closing the deal to replying to a tweet. It’s necessary to encourage employees to make their own decisions, take responsibility, search for the information, and analyze it. Reducing the bureaucracy, you speed up the performance, teaching employees to think independently.
As a manager, you should give your team an opportunity to organize their work themselves, creating a healthy environment where an employee will work not because of being pushed but because of intrinsic motivation.
Exactly this type of cooperation with a transparent reporting system we offer to our customers. When we start a project, we share our experience with you, customizing certain processes as appropriate. We choose the best way to collaborate, taking into account the specific project features.
Advantages of IT Outsourcing to Jellyfish.tech Team
After narrowing down the search for a potential technical partner, we still have a plethora of Ukrainian tech companies, more and less professional, ready to come to the rescue when it comes to software outsourcing. How to take the final decision?
1. Check out the following information about your potential technical partner:
- Website;
- Case studies that prove the expertise you require;
- Client reviews on credible directories like Clutch, GoodFirms, etc.;
- Online presence of the chosen company on web development directories (Design Rush, Top Digital Agency, etc.);
- Social media accounts (Facebook, Twitter, LinkedIn).
Frequently, it’s enough to take one look at the above-mentioned sources to realize if it’s worth working with this company.
2. Listen to how the company describes its culture and the benefits of cooperation.
Understanding key strengths and competence it offers to clients is, of course, compulsory for any company, however, you will be surprised to learn how many companies have a vague idea about their characteristics that a client may benefit from.
At Jellyfish.tech, we are aware of the value we may add to a business:
- Beneficial price-quality ratio. The crew consisting of web & mobile developers, project managers, quality assurance engineers, and designers stands out because of proven experience, relevant technical stack, attention to details, good communication skills, advanced knowledge of English to break the language barrier and flawless project management, oriented towards minimizing miscommunication.
- Less time to market. One of the main benefits, Jellyfish.tech team offers you is the possibility to launch an awesome product before your rivals do with a fully organized and competitive MVP developed in eight weeks. In the fast-growing digital environment, speed is one of the main competitive advantages, thus, it’s extremely important to beat competitors.
- Detailed reporting system. As a customer, you will get the daily reports from PM in addition to the round-the-clock access to the testing server and demo within a specified time frame (depending on the project type, the time frame is discussed specifically).
- Endless support with our experience. Taking a project, we are involved not only in its successful completion but the further life as well. That’s why any project may get our feedback and support at any moment of its existence, including the period long after launching it.
- Integrity as an essential element of the corporate culture. Cooperating and communicating with clients all over the world, we’ve seen the utmost importance of integrity in an outsourced team. Coordinated teamwork is a must for us, as without effective communication within the team, the delivery of a superior product is impossible.
The above-mentioned words have no value without any proofs, therefore, customers’ feedback on Clutch will be the best evidence.
Of course outsourcing can be an excellent solution and Ukraine is the best choice for it.
It`s got a lot of benefits and advantages.
Definitely Ukraine should be the first country to think about if you are interested in outsourcing.