Many initial moves of expansion in global markets involved allocation of work to a single site mostly in India, China or the eastern part of the world. Cost was the biggest motivator in this regard as skilled labor is drastically cheaper in India than in the US or Europe.
It is a common trend nowadays as various enterprises are now establishing state-of-the-art development centers in a plethora of locations worldwide. Cost-effectiveness is a important factor but there are many other factors now that have come in to play:
* With a larger pool of available virtual resources placed in offshore companies, companies can now hire less full-time workers and better talents from different sites.
* With teams working in different time zones, companies can realize better utilization fof resources for software development.
* Eastern teams deliver work after completion of their day which is the beginning of the day at their western counterparts.
* Presence in a local market helps in globalization of applications and also boosts marketing.
As offshore development has been popular now for quite a while, most companies have been great in choosing projects tactically. They have tried to pick up non-core tasks which were weighing in on their financial resources and have managed to allocate those tasks at cost-effective prices at offshore locations. Nowadays offshore software development has become more and more strategic with pilot projects leading to enterprise-level initiatives, while most ad-hoc efforts have streamlined itself into governed processes. Outsourcing projects to the right people with the right skills is crucial too.
The best aspect of outsourcing nowadays is that the tasks are no longer restricted for maintenance work. Application testing is now being outsourced rapidly followed by application development along with ERP development and customized applications.
It is evident with the recent trends that the globalization of resources has become a huge hit everywhere. More than 70-80% of the projects have been successful and have resulted in profits for the client company. In the earliest times there were very few pioneers who were actually willing to test the waters and even venture into unchartered grounds. Now the tide has turned and more and more companies are actually putting their money in offshoring since it has benefitted hundreds and thousands of companies worldwide.
According to some research reports and estimates, more than 80 percent of software projects are now being worked upon on a global scale. Additionally, the trends are even strong for the future as partnerships are forged between these companies instead of just using them as centers for completing short term projects.
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