Why do you outsource IT services and software development to India, Russia, Vietnam and the Ukraine, to name a few? Because it’s cheaper there?
Good reason. You’re trying to cut development costs for your company.
But what are the hidden costs? What about “you get what you pay for”?
Some people have told me “I’ve looked at outsourcing development in Argentina or Mexico, but it’s more expensive there.”
I don’t mean to disrespect those countries mentioned at the start of this post, but by outsourcing development to the “usual suspects” as a knee-jerk reaction, you could end up shooting yourself in the foot, and excuse the leg and foot clichés.
Is the price worth the cost?
Is outsourcing to countries 9-18 hours away worth it just to pay a little less? How about those midnight calls to your dev team in Bangalore? How about trying to coordinate your stateside dev team with dev teams in Eastern Europe? What about trying to get somebody to provide you with creative suggestions instead of just agreeing with you all the time?
I’m not making this stuff up. I’ve talked to Fortune 500 Software Product Directors and Internet Start-up COOs who have complained precisely about these issues. People have told me about the nightmares they have experienced when entire project teams have changed due to high turnover. Does the popularity of outsourcing to South Asia maybe have something to do with that?
Am I saying you won’t experience this in Latin America? Not at all. What I am saying is that it is still an untapped outsourcing market that offers the following advantages:
The undeniable facts about Latin America
- No more late nights: Mexico is a true nearshore location, as is Costa Rica, Guatemala, Nicaragua and Panama; Argentina, Brazil and Chile are within our relative time-zome comfort zone.
- You get to meet your dev team: Flights to Mexico take about 2 hours; to Central America about 3 hours. How about meeting the dev team in the morning in Costa Rica, and in the afternoon drinking a daiquiri on the beach?
- Somebody who will disagree with you and provide you with creative ideas: The cultural scene in Buenos Aires, Mexico City, and Santiago are actually closer to U.S. and European culture. These are not “yes” cultures; the word “no!” does exist. That’s a breath of fresh air when you’re not sure if a nod of the head means yes or no way.
- They speak English! This group is highly educated, and most of them speak English very well.
- You gain a whole market, not just developers and designers. Internet penetration in the Latin American countries is exploding, with an 854% growth from 2000-2008 vs. 316% for the rest of the world. When you hire a team of web developers and designers from Brazil, you also gain Portuguese expertise who can localize your product or website to the Brazilian market. That’s a market with a 200 million population. Did you know that?
No such thing as cultural neutrality
This last point I think is the kicker. The Latin American market is still relatively untapped by most American companies, except for Coke, GM, Ford, Microsoft, Oracle…well you get the picture. Everybody’s falling all over each other trying to beat the door down to the Chinese and Indian markets, and Latin America is almost an afterthought.
They haven’t read Blue Ocean Strategy or extrapolated it to a geographic scenario. They also believe that their stuff will just sell in Latin America without any effort. Well, the Chinese are making an effort
Hiring developers, web designers, and technical writers in Brazil and Spanish-speaking Latin America is not only a smart alternative to hiring development teams in India and Russia, but it also opens up a whole market.
As my friend Jason Stoddard told me: the developers ARE the market.
Who are these people?
Meet some of the various, friendly and extremely capable outsourcers that could be your next provider. Companies like Zacsoft, a software factory in Zacatecas, Mexico that trains young raw talent with high potential, straight out of school, in various software development languages and methodologies.
Companies such as CentralDev, out of Buenos Aires, Argentina, who do hardcare software development as well as beautiful website design.
Or groups such as Tequila Valley, Palermo Valley and Valdez Valley in Mexico, Argentina, and Colombia, to name a few, Web 2.0 communities where hundreds of freelancers gather together to network and share development ideas and project leads.
And many many more, including full-fledged IT firms with 100s of employees, loose networks of freelancers, LinkedIn groups, Facebook groups, Twitter communities, etc.
So the next time you decide you are going to outsource, think twice before you fly to Bucharest or Mumbai, and instead think about the market in our own continent!
To find out how to find a quality software or web programming team, or web design and graphic design team, call me at 979-212-8033 or email me at email@example.com.