Are onshore delivery teams dead?

Over the past couple of years we’ve seen in WE AS WEB a surge of enquiries coming from organisations in need of exploring hybrid delivery models with nearshore, but who didn’t know whether to begin. Common challenges we’ve heard from our clients were around setting hybrid delivery strategies for success, assessing nearshore partners and forming high performing delivery teams.?

First of all, why nearshore? And why now?

The decline of the purely onshore delivery model in favour of hybrid and flexible delivery teams is well documented in recent research. According to McKinsey, companies are increasingly adopting these models to enhance efficiency, access diverse skill sets quickly, and maintain flexibility in their operations. This shift is particularly evident in Western Europe, where organisations are balancing local expertise (and the gap therein) with more global resources to remain competitive in a rapidly evolving market.

What’s driving the (continuous) change??

1. Cost Efficiency - and not just in day rates: Nearshoring has been renowned for bringing a significant cost advantage to onshore teams. While companies traditionally looked at 30%-50% cost savings compared to onshore teams, the cost advantage to an organisation has become much greater.

Here are top 3 reasons we hear from our clients:

a. Less overhead in searching for talent (avoiding long interview processes, hiring teams fighting for the same talent).

b. Stronger technical experience proved by education excellence, a growing tech ecosystem and tight competition in Eastern European cities.

c. Faster and more efficient delivery - motivated teams with extensive nearshore experience who make a difference on Day 1.

2. Access to exceptional talent: The tech industry is a key driver of economic growth in Eastern Europe. Encouraged by government incentives, countries like Romania, Moldova, Serbia or Bulgaria have been prioritising STEM Education and have a long tradition of excellence in mathematics and engineering education, leading to a robust pool of technical talent.?

3. Tech Evolution: Not long ago Covid had shown us that team performance stems from a good collaboration and communication and is not limited to collocated teams. Tools like conferencing, project management software and cloud-based platforms have facilitated seamless integration across geographies, making full time office jobs unnecessary and collocated teams cost hard to justify (with the exception of occasional creative work and social gatherings).

Let’s not forget the caveats: onshore delivery teams are certainly needed when you’re bound by regulatory and compliance, or when local security concerns can’t be avoided.?

In a market where competition intensifies and technology skills are still scarce, companies have to react quickly to innovate and expedite their roadmaps, making hybrid delivery models often the preferred choice for technology executives.

Interested in how we work with our partners?

In the next posts we’ll explore what strategies companies can adopt to embed hybrid delivery in their organisation, how to best choose a nearshoring partner and what it takes to form high performing teams with nearshore.