Outsourcing has been a pillar of the world’s economy for quite a while now. The world of software development is no exception. There are many reasons this has happened and continues to — and I want to discuss why Latin America should be your present go-to destination for software development.
Why Outsource Your Software Development?
Remember, the primary reason for outsourcing is simple: reducing costs. In the words of James Bucki, in his article for The Balance: “Outsourcing shifts tasks, operations, jobs, or processes to an external workforce, by contracting with a third party for a significant period. “
As mentioned before, this happens typically due to the motivation to reduce costs and, therefore, make a project something more possible to achieve or to delegate tasks and responsibilities to different teams.
Consider, for example, the world of video game development. While it’s not entirely correct to call it outsourcing, this case that came to my mind technically applies: Bioware’s titles, Dragon Age: Inquisition and Mass Effect: Andromeda, were developed by various studios in the United States and Canada.
While Bioware has its official headquarters in Edmonton, Canada, it sourced development to its studios in Montreal and Austin.
Even though they named this the “One Bioware” initiative and these three studios are indeed part of Bioware, they split activities between studios in far-off locations across Canada and state lines towards the US instead of having one team develop everything.
It is a complicated yet exciting story of a case of outsourcing that’s not motivated by cost but by talent and manpower. If you want to take a look, this post on Kotaku is a good read!
But indeed, cost is a primary motivator when outsourcing work. Consider India as a case study. A lot of software development has historically been contracted off to India.
The reason is pretty evident since we’re talking about cost: An Indian Rupee doesn’t amount to a single cent in US currency, and if we consider India’s average wage of around 32800 Rupees, you could potentially hire a professional for just under $500 a month.
Comparatively, when considering the American giant, one could never achieve such a competitive cost advantage when hiring locally.
Another exciting reason is language, a myriad of languages spoken in India. We could almost say that no two regions speak the same language. The country doesn’t have an official language, and the nationalized Hindi is a constructed language used only by the government. In contrast, Hindustani, Bengali, Marathi, and others are the actual languages spoken by everyday people.
Yet, due to its rich and complicated history, India has a lingua franca in English, eliminating (mostly) the language barrier and making it a prime target for Software Developers elsewhere in the world to outsource work. This doesn’t apply only to development; IT services and call centers are popular in India for these reasons.
Coming to Latin America
The southernmost part of the American continent has become the new hotspot for software development while sharing the same cost advantage as Asian destinations, and it is also a significant component in the shared language.
Latin America offers advantages that places like the Indian Subcontinent or Eastern Europe couldn’t hope to achieve.
Proximity is a significant factor. Nearshoring is the term often thrown around; outsourcing to a place that, while off-shore, is just nearby enough not to present such a difficulty when dealing with time zones. While noon in California is about twelve hours ahead in Mumbai, essentially the next day, it’s only 3 pm in Caracas and just about the same in Bogota.
Not only this, but also the cultural factor is considered by this proximity. Historically, American (US) culture has heavily influenced South America, much more so than locations in the Far East, South Asia, or Eastern Europe.
This closeness in culture avoids the complications of cultural barriers, making understanding one another easier since it’s not just a question of the same language spoken.
Also, the market is ripe to offer; in a post-pandemic world, outsourced, remote jobs are more popular than ever. It’s a mutually beneficial symbiosis that’s sought after by the potential employee just as much as the employer.
With the exponential growth the IT and Software Development industries have had in the continent, plus the upgrading of internet infrastructure to match speeds with more developed locations, Latin America is the new contender on the world stage for outsourced software development.
Conclusion
If you’re looking to develop software, either for your company or as a personal undertaking, then take advantage of Latin America’s competitive edge: lower your costs, entrust work to highly trained personnel, communicate effectively with people who will understand and work together with you to achieve your entrepreneurial goals!
See more articles by Paola Rodriguez.
