COVID-19 has impacted the entire modern world, and the software development industry is no exception. The best-known outsourcing destinations are being heavily influenced by the ongoing pandemic affecting companies that choose to use local services.
Some centers support the largest companies in customer service, technical support, or software development in countries like India. Thanks to the low-cost service, India has become a base for many organizations, including top companies in the market like Microsoft, Google, IBM, and CISCO. India dominated global outsourcing with a market share of 67% (2018).
The IT industry in India is valued at more than $ 150 billion and is growing by more than 10% annually. C. Sharp Corner believes India will be the world’s leading center for software developers by 2023. Cost is the number one reason companies around the world outsource their services to this country. Development costs are 30-35% lower than in the US and Europe.
After the Pandemic, when the recovery begins, the demand for software development outsourcing services is expected to increase. The pandemic has highlighted the benefits of IT solutions both for internal business processes and for working with customers. Companies are now more aware that pandemics can return. They are aware of the impact on their business. However, it is usually not possible to hire additional staff to develop software, especially after such a crisis.
Organizations are beginning to realize that an offshore software development company can make them more agile and stronger in difficult times. Of course, this is only the case if the outsourcing is carried out correctly.
In a survey of UK companies not currently using ITO, 37% said they would consider Software Development Outsourcing Services due to COVID-19. Remote work blurs the distinction between in-house, nearshore, and offshore teams. This could create opportunities for software developers from emerging countries.
What is Outsourcing?
Outsourcing is the process of running your business outside of your in-house infrastructure. They are known as outsourcing when you hire remote developers, dedicated teams, distributed teams, freelance professionals, or complete your entire project in an off-site location. You can outsource product development, MVP development, a specific task, an entire project, or hire some experts/teams to work on it by partnering with the best offshore software development companies.
Which Country is Best to Outsource Software Development Company in 2021?
Well, the quick answer is India. India is recognized by countries around the world as one of the top destinations for software development outsourcing. Hiring Indian Software developers will help improve the efficiency of your business process which will increase your sales with minimal investment.
According to a recent survey, 80% of US and European outsourcing companies have India as their preferred location. According to the report by the National Association of Software & Services Companies (NASSCOM), nearly half of all Fortune 500 companies will choose Software Development Outsourcing Company in India.
While many other countries such as China, Ireland, Mexico, and the Philippines have emerged as major competitors, India has still managed to come out as the top outsourcing terminus.
You must be wondering why India.
Why Should You Outsource Software Development to India?
India has many talents in all kinds of fields. In the IT sector, in particular, great talents are waiting to show their skills to the world. Many US and European companies are constantly looking for a pool of Indian developers (with experience) as this will help take software technology to the next level.
Statistically, the country is the preferred choice of most countries over most of the outsourcing companies in Western Europe or other Asian countries.
The lack of experienced and talented experts on the west side has also led companies to opt for software development outsourcing company in India. This offshore outsourcing helps many companies to stay competitive and increase their ability to expand their market to different countries.
What are the advantages of Software Development Outsourcing Company in India 2021?
Massive Talent Pool: India has the largest technical and professional talent pool in the world. India is one of the few places in the world where people are qualified professionals and experts for their jobs. For your tasks, you are looking for someone who can work on them without compromising on quality at lower costs. The companies in India have years of experience in assisting overseas businesses with high-quality and affordable services that help them manage their business processes with ease.
Cost Savings: The main reason India remains a top outsourcing provider is because of the significant cost savings companies can make. This is mainly due to the huge gap between labor costs in India and the developed world. For example, a good developer in the US can cost anywhere from $ 50 to $ 80 an hour (for a full-time employee, depending on skills and experience). In comparison, the hourly cost of a developer in India can be negotiated at up to $ 15 an hour. This price flexibility gives companies the freedom and creativity to manage their budget and help them make big profits.
High-Quality Services: While the cost factor plays a major role in outsourcing, India has also maintained as a top outsourcing destination thanks to the consistently high quality of the Software Development Outsourcing Company in India.
Easy Communication: If you are looking to outsource web development or any other project to India but are concerned about how to communicate effectively with the offshore software development company then consider the fact that India is the second-largest English-speaking nation in the world. Communicating with remote developers in India is not a problem at all as Indians can easily communicate in English.
Top Class IT Infrastructure and Latest Technology: Software development companies in India that provide software and web development outsourcing services have a state-of-the-art IT infrastructure and use the latest technologies to provide high-quality solutions such as software development solutions, mobile app development solutions, custom web development solutions, etc.
24/7 support: If you outsource to your outsourcing partner based in a country like India, you will get 24/7 support for your projects as they are in a different time zone. Here, too, you can use manpower 24 hours a day. The outsourcing partner can take over the work and complete the upcoming tasks while you are away from the office. Everything is easy because they are working on your projects that your employees either left untouched or left halfway because it was too late and they had to go home.
Focus on Core Functions: By outsourcing functions that are not part of the core business, companies can concentrate on the core functions while offering better customer satisfaction and product features. By partnering with the Software development outsourcing agencies in India, companies can increase their profitability and focus on the functions that take the company to the next level.
Dedicated and hard-working professionals: Your project will be handled by hard-working professionals who are committed to ensuring that you are completely satisfied with the end product. Many outsourcing companies in India work 9 hours a day and are always willing to invest extra time to meet short project deadlines.
On-time Project Delivery: Software development outsourcing company in India is known worldwide for their very fast project execution. In addition to the specialist knowledge and extensive experience of Indian specialists, the time zone difference is an important factor that contributes to faster project processing. Often projects are completed and delivered earlier than expected.
The Indian Government is Stable and Offers Attractive IT Policies: India is a politically and economically stable country. The policy of the Indian government supports the IT industry to a great extent. The Government of India regards IT as one of the top priority industries and all of their IT policies are extremely favorable for outsourcing to India.
To help the IT industry grow, the government offers tax and other perks. The Information Technology Act recognizes electronic contracts, and India’s Cyber Act controls cybercrime so that smooth service can be provided to global customers.
What Software Development Services Are Outsourced to India?
India has a Massive Talent Pool which companies are looking for from all over the world to outsource IT services. The field of the IT industry is large, and one can outsource services from it. Here are some of the most commonly outsourced services in India.
Web Development: Outsourcing web development services to India is one of the preferred choices of companies. There are so many reasons that could be extremely beneficial for you to outsource web development to India. You can refer to quality, affordability, technology specialty, and a lot more.
Ecommerce Development: Outsourcing allows you to focus on your eCommerce efforts and implement and analyze tactics to fully optimize sales. With an outsourced eCommerce developer team, your job is to focus on your eCommerce business without being distracted by other parts of it.
Enterprise Software Development: Companies must undergo digital transformation to take advantage of the evolving technologies and gain a competitive advantage. Whether application modernization, migration, consulting, system integration, or any kind of maintenance and support in digitizing your company, outsourcing corporate solutions can simplify and accelerate your digital transformation.
Product Development: The next important service that most organizations, be it an established company or an aspiring startup, is product development outsourcing, which can help you develop the product. You can even ask for a prototype or MVP of your project before the final product is created.
Digital Marketing: To be present in the digital world is not enough for a brand. It has to be present, visible online, and make a strong impression. That’s why you need digital marketing! Outsourcing digital marketing services can help you strengthen your online presence and increase online visibility to increase sales.
Mobile App Development: When you have a mobile app idea, outsourcing the mobile app development can help you get all of the features and functionality you need to be successful. Whether you want native app development or cross-platform app development, you can easily do it through outsourcing.
How do software outsourcing companies in India manage different time zones?
1) Make clear requirements.
2) Visualize overlapping hours
3) Establish communication channels.
4) Establish regular meetings at the overlap times
5) Use project management tools
Now, Let’s look at the statistics the prove India is Better than Other countries when it comes to offshoring.
No country is as progressive and rich as India when it comes to software development. It has a young population eager to collect all skills and deliver the best. It has become a magnet for companies looking for a development partner, technology partner, or an IT outsourcing company for other technical requirements. And not without reason. Here are some of the stats and metrics that show India is better than the rest when it comes to outsourcing software development.
- The IT outsourcing industry in India is projected to see a CAGR growth of 7.25% and reach INR 8,830 billion by 2025, up from INR 5,649.47 billion in 2019.
- According to the 2017 Asia Pacific Occupier Survey Report, 82% of Indian outsourcing companies plan to increase their technology workforce in the coming years.
- The cost of outsourcing to India is far lower compared to developed countries. In India, you can get developers for an average of $ 25.
- India tops the list of outsourcing attractiveness in AT Kearney’s 2019 Global Services Location Index.
- It is expected that by 2022 over 40% of the Indian workforce will improve their skills and intervene more actively in the development process.
- India ranks first on the list of countries with the highest ISO 9000 certified software companies, and is home to over 75% of the world’s CMM Level 5 certified companies.
- India ranks second after the USA in the list of the largest English-speaking countries and removes all communication barriers.
- According to a report by C Sharp Corner, India will overtake the US with the most software developers in the world by 2023.
Trends that are Expected to Shape Outsourcing Industry in 2021
Every year there are some new trends that shape the outsourcing industry. Those looking to cut costs and get quality development services from experts are looking for leading IT outsourcing companies in India, Malaysia, Poland, Ukraine, and other countries. However, to ensure a successful business one must be aware of all upcoming and ongoing outsourcing trends.
Businesses to Increase Their Outsourcing Budget: For companies looking for IT services, in 2021 quality would take priority over quantity and they would begin to prioritize process over price. As a result, companies started increasing their IT outsourcing budget in the coming year. The National Outsourcing Association reports for 2020 indicated that quality would be the main driver in any outsourcing decision. Don’t be afraid to increase your outsourcing budget. Given the skills shortage in most countries due to the coronavirus outbreak, more companies would outsource software development. The present software developers have increased their hourly rates for development. And to attract the best talent, companies need to increase their outsourcing budgets.
Rise of Standardized Services Instead of Custom-Model: As the outsourcing providers gain the upper hand in the outsourcing relationships, the standardization of services would increase. The outsourcing trends in 2020 placed more emphasis on bespoke services that meet project requirements. As companies need faster digital solutions for their business, they are looking for standardized services. Such services would not only allow them to get to market faster, but they would also reduce their development costs.
Tailor-made solutions turn out to be significantly more expensive. As most companies change their business models, they need money to acquire new customers and enter the market. In order to optimize their business models, companies with limited resources look forward to optimizing their business strategies. Smaller companies would be more interested in standard services or service packages from IT outsourcing companies in order to contain their IT costs.
Demand for Companies Following Agile Model: Instead of focusing on the price of development, 2021 would be more process-oriented. The working approach will be of the utmost importance as it will allow them to strengthen their development as a whole. And the best approach that the majority of businesses are focusing on today is agile. Over 71% of companies already follow the agile development approach and require the same flexibility in their outsourcing relationships. This would help them take advantage of the many benefits of outsourcing, such as lower overhead costs, round-the-clock work, better communication, and on-time delivery.
Now companies are looking for IT outsourcing companies that follow the agile model and can also share their know-how with customers. You want agile remote teams as they have been more productive to get their jobs done faster. It won’t divert focus from development priorities and can even make a small change in a sprint instead of investing time in functional skills.
Talent Shortage to Increase Outsourcing Demand: IT outsourcing spending has reportedly exceeded $ 1 trillion. And that is due to the adaptation to the latest state-of-the-art. However, the companies lack the necessary technical know-how in-house. The pressure to stay competitive in the industry would force most companies to outsource their IT functions. From cryptocurrencies to cybersecurity to AI, ML, or data science, companies are looking for the best talent to develop products with such functions.
The lack of technical know-how in their region leads to an increased demand for outsourcing of IT services. They need cutting-edge skills that they can easily find in outsourcing destinations like India. However, such experienced software developers will begin to increase their hourly rates. Thus, the demand for new technology would also lead to an increased spending budget.
COVID to Boost the Company’s Digital Spending: As mentioned earlier, companies look forward to increasing their outsourcing budget. And not just because of growing competition or advancing technology. The coronavirus pandemic has forced companies to digitize their business processes. Regardless of whether it is a question of bringing a digital product onto the market or making your digital products more secure, robust, and scalable, they rely on rapid transformation and put their work platforms online. This would mean reducing their spending on legacy services and increasing their digital spending.
Big names like Microsoft claimed the coronavirus resulted in a two-year digital transformation in just two months. More and more companies would increase their digital spending to keep up with the future of technology. Most companies are now turning their business model into a digital one and will increase their spending to stay competitive in the digital age.
The Asia Pacific region is becoming a popular outsourcing destination: By 2020 it was clear that new competition would arise in the outsourcing industry. Countries like Ukraine, Romania, Poland, and Belarus were seen as the tough competitor’s eager to overtake India, China, and other front-runners from the list of top outsourcing countries. However, the pandemic has slowed that transition. With quality outperforming price and other factors, companies are trying to turn their attention back to the key players in the countries they previously trusted.
Companies are moving to Asia Pacific countries such as India, China, Malaysia, Thailand, Philippines, Vietnam, etc. Given the outsourcing demand and budget shift, it looks like more and more countries are turning their attention to Asia Pacific countries. These countries would maintain their strong positions due to their low-cost outsourcing services and high-quality supplies.
Outsourcing relationships for further development: A new outsourcing relationship would begin in the outsourcing area and produce a more developed form. In the past, outsourcing relationships were a give and take where companies bought services from IT outsourcing companies. Now the role of these outsourcing companies has gradually shifted. They are no longer ordinary workers providing software development services. You are more involved in the software architecture and larger decisions. These companies now play a critical role in various aspects of the decision-making on the project, including MVP, features, monetization channel, rollout, etc.
One of the top outsourcing trends in 2021 would revolve around the changing outsourcing relationship. IT outsourcing companies would be seen in product development during the entire cycle from idea to development to marketing. They are strategic business partners and their role will grow in importance in the years to come. In 2021, IT outsourcing service providers would become strategic partners who share risk and seek long-term relationships for better results.
Conclusion:
The pandemic has raised major concerns about outsourcing among people. It changed the way people viewed outsourcing and how they hired people to do it. IT outsourcing was turned on its head after the pandemic. But, while most companies are scaling and accelerating their digital transformation initiatives, IT companies in India are gaining new business. The Indian IT outsourcing industry is therefore certain to see an increase in sales.
If you are also planning to outsource your IT operations, India is a leading destination for such services. Nucleosys Tech is a leading software development outsourcing company in India. It offers customer-oriented development services as well as standardized services that meet the needs of all customers.
