The COVID-19 Impact on Software Development Outsourcing

The impact of COVID-19 on the global economy is far-reaching, with every industry affected. Technology, once thought invincible, hasn’t been untouched by the disaster, economically and otherwise. In light of the pandemic, Forrester Research revised its predictions about the tech market in 2020, projecting growth to slow to about 2% during the year.

There is one silver lining for businesses hoping to achieve a technological breakthrough, though. Outsourcing — using third-party onshore, nearshore, or offshore software development services — will fare better, also according to Forrester’s predictions, as many organizations move their operations and work online.

Types of Tech Services in High Demand

It probably comes as no surprise that certain types of software and other technology are in greater demand than others during this tumultuous time. In particular, as an overwhelming number of people are now working, learning, and socializing remotely, cloud infrastructure, telecom, and general communication software is on the rise. Forrester’s report noted growth in spending in these and other specialized services.

Goals and Major Services Delivered

There are many reasons why companies outsource their software development projects to providers around the world at any point. During the pandemic, however, some goals emerge as central to businesses’ survival. They include:

Remote Upkeep

Employee support is paramount during a period when most of us are spending the majority of our lives at home. In order for employees to continue to carry out their job functions from remote locations, they will need to have the infrastructure and technological resources necessary for their work.

Not only do these include the aforementioned cloud and communication technologies — but they also involve security measures, troubleshooting, and more. Cybersecurity is especially important when people are accessing company software and programs from many different locations. An outsourcing provider can help install VPNs, firewalls, two-factor authentication systems, and more to help.

The team can also assist with technology updates, remote collaboration services like chat technology, and file sharing.

Data Collection

As technology becomes increasingly sophisticated through the advent of the Internet of Things (IoT) and more, businesses are able to gather data to an extraordinary scale. Big data, of course, was a concept well before COVID-19 wreaked havoc on our lives, but the extent to which organizations must scrutinize their information to assess consumer behavior is even greater now. After all, people are responding to an unprecedented crisis in unprecedented ways.

In order to better understand how customers are interacting and engaging with products during the pandemic, some businesses are relying on software outsourcing partners to help them analyze their data to discover meaningful trends.

Branding and Maintaining Presence

Now that most nonessential organizations must conduct their business entirely or almost entirely online, a digital presence becomes all the more important. Software development services can assist with everything from artificial intelligence (AI)-powered chatbots to improve customer services to aesthetically-pleasing web design.

These little touches can make a big difference in customer retention when so many people are facing strained finances — people are more likely to stay with and gravitate to businesses that prioritize user experience.

Benefits of Global Outsourcing During COVID-19

Across sectors, businesses are facing a number of hurdles that are becoming increasingly difficult to cross. Nearshore and offshore outsourcing providers, in particular, can help mitigate many of these issues.

Lower Rates

At a time when many companies are forced to lay off workers, they’re left wondering how to fill in the gaps without facing steep price tags. Outsourcing work, in general, is significantly cheaper than using full-time personnel — you’ll save on salaries, benefits, overhead, and other costs. Given the financial concerns, many organizations are facing and will continue to face, outsourcing to a country with a developing economy makes the most sense.

Rates in places like Latin America, Asia, and Eastern Europe are usually lower than those in the United States. As COVID-19 rages on, seeking talented professionals at a reduced rate is essential for maintaining continuity.

Risk Management

It’s especially important to share risks during uncertain times like now. Outsourcing software development across different geographic locations allows you to do just that — share risks with an offshore partner. Given the high level of talent in different regions, you can ensure you’re creating quality products that will allow you to stay afloat. They’ll also help you understand global regulations and laws to further protect you.

Looking Ahead

We have yet to see how COVID-19 will change the world permanently, but it’s almost definite that many of the pandemic’s effects will be irreversible. We could see an increase in remote work, with more and more businesses encouraging employees to work from home. We may also see the economic effects of the pandemic lasting longer than we’d like.

In the face of the new reality, software development outsourcing can provide some relief to many organizations, offering technological support at a low price. The benefits of the model are many, from helping businesses increase employee productivity to enhancing collaboration — ultimately, even, allow them to persist through unprecedented circumstances.