Nearshoring reimagined. Software development projects in times of crisis

During the pandemic, 85% of CEOs increased spending on digitization projects. It was a response to new challenges. Today, planning and proactive action seem more difficult than ever – new times require a new strategy, also in the IT industry, which faces a shortage of developers and increased needs for projects. The answer may be the development of software in the nearshoring model. Find out what IT is and whether your company should use it.  

Challenges of new times 

As the researchers supposed, after the first waves of the pandemic, many IT industry employees decided on a hybrid work model. Developers, and not only, are more willing to work from home and a million dollars for whoever manages to persuade the developer to work in the office. Rising fuel prices and living costs also do not encourage commuting to offices. The British, like many other nations, are trying to cope with the effects of the economic crisis. 2/3 of young people put lifes “on hold” due to inflation. 

The IT industry and the crisis 

2/3 of companies in the UK admit that their employees are demanding pay rises. The crisis does not impact the software development industry – there are many projects to carry out and the needs are huge. According to Statista, there are 465,000 developers in the UK. This is almost 60,000 more than the year before, but still not enough to cover the demand for IT projects. Today, everyone is cautious while planning budget, and recruitment, HR activities, marketing activities to attract talents needs investment and huge effort. In the event of the resignation of an IT specialist, all these efforts are in vain. How to build a recruitment strategy in uncertain times? Is that even possible?  

Analyze, Plan, Adapt, Repeat  

As the well-known saying goes, “a goal without a plan is just a wish”. But today, the plan alone, even the best, is no longer enough. The plan should have solid foundations, but flexible enough to adapt them to changing circumstances. So how do you find yourself in a new reality? 

  • Analyze – Proactive action should be based on analysis. In a nutshell: you rely on data from the past to predict the future. Today, being data-driven is not only an important trend but also a factor determining the competitive advantage. For this purpose, you can use self-service Business Intelligence tools such as Power BI or Qlik. Their implementation is not laborious, and there are many companies on the market that deal with professional preparation of dashboards and training of the organization’s users.  
  • Plan – it might seem that planning is impossible in times of uncertainty. Long-term planning is associated with the risk of failure, but you can still plan shorter cycles – e.g., 2-3 months. It’s a bit like agile project management in such a popular Scrum framework. You work in iterations to achieve a better result.  
  • Adapt – analysis and plan do not mean that you should stick to them rigidly. A data-driven strategy alone will not deliver the expected results if you cut yourself off from external factors or ones that appear unexpectedly. In recent years, many companies have learned how to respond to change. In IT continuous improvement is of high importance. Repeating the entire cycle: Analysis – Planning – Adaptation will allow you to maintain flexibility within your roadmap.  

IT Nearshoring as a solution for the time of crisis 

An interesting solution with a lot of flexibility is the nearshore software development model. This is an approach that has been successful for many companies in Europe for several years – no wonder. Companies do not have to outsource tasks far away. They can maintain control over what happens, and it is easier to arrange a business trip, if necessary.  

Companies from the United Kingdom, Germany or Scandinavia are willingly taking advantage of the support of the Baltic countries, where the rates in IT are very tempting, and the supply base of experienced specialists – vast. For example, in Poland, technology hubs and R&D centers are being created, in which global brands such as Google and Facebook are eager to invest. IT Nearshoring makes such an option available to everyone, including companies from the medium and small enterprises sector.  

When to use IT nearshoring?  

  • When you have no time – today, applications are built quickly, technologies are constantly changing, and short deadlines are not conducive to the implementation of quality solutions. The recruitment time of a single specialist, in optimistic variants, is on average 2-3 weeks. It may take about 7 weeks or more for the whole team to be recruited. In the nearshoring model, you can use available specialists at hand, often only technical verification of the candidates proposed by an external company is enough.  
  • When you lack IT specialists – the education of IT staff takes a lot of time, and despite many available vacancies, e.g. In the area of cloud technology development, robotics or AI, people still do not decide to enter the IT industry. What is the reason behind it? Perhaps the lack of digital competence. According to data cited by the BBC, almost 12 million people lack basic competence in this area. Experienced developers, on the other hand, are in demand and expect more and more attractive rates. A 5-10% pay rise is not enough today to keep specialists in the project.  
  • When you care about quality – outsourcing in common opinion was once associated as a budget option. As more and more software houses attract programming stars specialized in this type of service, the reputation of outsourcing has improved. Today, it is an opportunity to use the know-how, tools and innovative working methods of technology partners and support provided by their specialists.  
  • When you are planning a budget wisely – one would like to ask: who is not doing so today? Nearshoring gives you an option to flexibly plan your software development expenditures. Many companies are willing to choose the Time and Material option, which incurs the cost of the actual time of specialists over a given solution 
  • When you want to grow – in the case of nearshoring services, many companies pay attention to the added value brought by the supplier’s specialists. In many organizations, the line between internal workers and those who come from outside is blurred. Nearshoring specialists bring a fresh perspective, provide feedback, carry out audits of processes and help you choose the best work methods. Companies that use such services admit that they did not expect such benefits.  

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The effects of the pandemic, economic uncertainty and the ongoing conflict in Ukraine are not reasons for optimism. Inflation has an impact on market realities, prompting employees to look for savings or to look for options for a better life. This does not create a good environment for quick recruitment, especially in IT, which is a difficult but prospective industry. When you have to recruit an entire team for a newly opened project, it becomes an even bigger challenge. An appropriate strategy based on analysis, planning and adaptation combined with the use of new approaches to software development is a sensible option in uncertain times. New challenges force us to look at solutions such as nearshoring from a different perspective.