Choosing the Right Location for Offshore Teams

Introduction

In today's global business landscape, the strategic placement of offshore teams can be a game-changer for companies looking to optimise operations. This decision is not just about cost efficiency; it encompasses legal considerations, time zone alignment, and specialisation in specific technologies. Drawing from my experience, particularly during my tenure at Prodigious, where we leveraged specialized talents in Mauritius and Colombia for front-end and back-end development respectively, this article explores how to choose the right location for offshore teams, focusing on creating centers of excellence.

Balancing Cost, Legal, and Time Zone Factors

The primary allure of offshore teams is often cost efficiency. However, cost should not be the sole deciding factor. Legal aspects, such as intellectual property laws and data protection regulations, play a crucial role. For instance, countries with stringent IP laws offer better protection for proprietary technology and processes.

Time zone alignment is another critical consideration. It's essential to have some overlap with your primary market or other development teams to facilitate real-time collaboration. This overlap can expedite project delivery and enhance 24/7 customer support.

Following the Sun: Condensing Project Times and Providing Round-the-Clock Service

Adopting a 'follow-the-sun' model can condense project timelines and offer continuous service. This approach involves transferring tasks across time zones, effectively keeping projects moving around the clock. Such a model not only accelerates project delivery but also ensures that customer service is always available, irrespective of time zones.

Centers of Excellence: Specialisation and Risk Mitigation

Establishing centers of excellence in chosen locations is about playing to the strengths of a region's workforce. Specialisation leads to expertise, higher-quality outputs, and innovation. It also mitigates the risk of transient teams in local markets. (I've felt this pain several times building support desks with great talent, rising young talent, that subsequently move up or out within 12 months).

For example, in my role at Prodigious, we capitalised on Mauritius' strong front-end development skills, particularly in Adobe Flash and HTML, due to their university curriculum and the cyber city initiative. Similarly, Bogota, Colombia, provided a rich pool of .NET developers.

In recent times, I have observed a growing trend in the Philippines where Magento expertise was initially cultivated, supported by university programs and a close-knit community, which is subsequently expanding into a much wider tech stack. Importantly, their cultural alignment with American markets and proficiency in English, along with their capability to operate in the ANZ time zone, makes them an ideal location for certain technology specialisations and customer service roles.

Global Examples of Specialisation

Globally, different countries have emerged as hubs for specific technologies:

1. India: Known for its vast pool of IT talent, particularly in software development and IT services.
2. Ireland: A preferred site for many tech giants, owing to its favorable tax laws and a skilled workforce in technology and pharmaceuticals.
3. Ukraine: Recognised for its strong pool of software developers and engineers.
4. Israel: Known as a startup nation, Israel excels in cybersecurity and hi-tech research and development.

Conclusion

Choosing the right location for offshore teams is a multifaceted decision that extends beyond cost considerations. It requires a strategic approach that considers legal aspects, time zone alignment, specialisation, and cultural fit.

By focusing on these elements and leveraging global talent pools effectively, businesses can establish robust, specialized teams that drive innovation, efficiency, and growth