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Why do Australian tech companies really offshore software development?

September 8, 2020

There’s an old saying in business, “Quick, good or cheap. Pick two!” But as technology changes the rules, customers now demand all three. For serious tech players aiming to compete globally, developing quality software at high speed is simply the price of entry.

Whether you’re a fintech startup building the next bank killer, or a national telco creating a self-service web app, a solid product developed in traditional timeframes will no longer cut it. You need rapid deployment, continuous iteration and real-time support. 

If you still think of offshoring as just a way to cut costs with cheap resources, it’s time to reconsider. If offshoring is more than a cost saving exercise, what is it really about?

It’s about speed and scale

In short, enterprise and tech companies need to scale up world-class software development teams that can deliver quality code today. Done right. Integrating offshore resources achieves this. 

Limiting your search within Australia makes recruiting slow and painstaking. While you may find one gun .NET coder or app developer, can you find 5 more of them along with a solution architect to ramp up capacity next week? 

Tapping into the global talent pool lets you grow your local team with technical equals, integrating them into your existing processes. 

It’s about the skills gap

Australia’s widely reported shortage of tech skills is deep and deepening. A recent report by the Australian Computer Society (ACS) and Deloitte found that for Australia to be a leader in the global digital economy we’ll need 200,000 tech workers (a 30% increase) over the next five years.

But the skills gap is not evenly distributed geographically. While there are local shortages, there are pockets of university educated, motivated and talented coders around the world that are underutilised. For example developers in Ukraine, and Eastern Europe more broadly, is a hotbed of largely untapped technological talent.

It’s about diversifying risk

While we’re hopeful COVID-19 is a temporary challenge, many predict a more mobile workforce is here to stay. Setting up remote teams both onshore and offshore is a hedge against sudden shutdowns or other location-specific risks. 

And, with the potential to have remote teams working ‘around the clock’ either with flexible local hours or international time zones further accelerates output.

It MUST be about quality 

Whether local, offshore or in your office, quality and security should be at the same level. Your reputation, data, intellectual property and customer privacy are your currency, so there’s no room for compromise on security and quality assurance. 

In an offshoring partner, look for the gold standard ISO 27001:2013 Certification for Information Security Management System to ensure everything is locked down from platforms, data and policies to human resources, asset management and access control.

OK, so only now is it about cost

Unless every other box is ticked first - quality, speed, skills and security - then cost is irrelevant. The web is a graveyard of poorly executed digital products. 

But in reality with high and growing tech salaries in Australia as compared with many other locations, there are significant savings to be made offshoring software development. 

For example at Hero Teams, by taking advantage of salary savings and looking after all the overheads of your full-time offshore team - recruitment, payroll, training, tax, insurance, offices, performance reviews etc - we can demonstrate a saving of more than $55,563 AUD per employee.

For over a decade, we’ve helped enterprise and tech companies build quality development teams at scale, with no compromise on security. 

If you want to explore any options for your business, send us a message or get in touch: www.heroteams.com.au

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