Romania is known for having a strong engineering talent pool. The Eastern-European country houses five top technical universities and 59 domain-specific educational institutions. With a grand total of 202k IT professionals that are employed in international IT and software service companies, and over half of them working in information technology outsourcing, Romania enjoys a thriving outsourcing industry, which accounts for roughly $5.5bn out of the country’s $6.4bn IT market, according to an ANIS report.
Romania has proved itself to be an appealing destination for IT companies when it comes to their nearshore software development outsourcing needs: the country is pivoting to the saturated markets of Western Europe and America, as well as to the solutions-hungry markets of South America or Africa, and the country’s technical skills, lower prices, and cultural proximity are becoming more visible on the international IT landscape.
However, in the post-pandemic work climate, when hybrid and remote work has become the new normal, a trend is starting to grow and threaten the pre-pandemic consensus of the outsourcing industry. Therefore, with freelancing and hustle culture on the rise, will outsourcing industries become obsolete?
We asked this question across Odeen and within our wider group, and we are certain that nearshore custom software development companies will, once again, continue to be relevant on the market, and freelance contractors pivoting directly to the client, will not become a significant threat.
Nearshore software development outsourcing companies bring the “whole package” to the client’s table
First of all, nearshore custom software development companies have a well-developed culture and experience in building dedicated teams of experienced IT professionals, making them functional in a short period of time, and with a relatively high success rate. This level of mature project management and team cohesion can only be achieved with time, countless projects, experience, and an understanding of what works and what doesn’t.
While it may be cost-effective for companies to hire separate individuals for the different posts they need, or indeed it may be more cost-efficient to go at it alone, as an IT services provider, success is not assured. When people work alone and don’t have a structure in place that can manage, organize and bring that ease into the team’s workflow and communication with the client, problems can emerge.
When attributions, like team cohesion and management, are unattended, clients might be faced with the need to organize the team themselves, which requires extra time, resources, and inside experience that they may not have.
“Organising IT professionals and computer programmers is not an easy task. Given their highly technical expertise, they may lack certain soft skills, which are required when conversing with the client. This is where the expertise of an outsourcing company comes in. If these people are not made to function well together, you start to see some negative signs emerging, like attrition, and this may severely affect the success rate of the project,” says Sabin Gîrlea, General Manager of Odeen.
With the right oversight of a nearshore software development outsourcing company over a project, it can expertly manage the needs, expectations, and desires of the client. Whether it’s creating a more autonomous development center, or one that is more integrated with the client’s team, the tailor-made input and experience that an outsourcing company brings to the table, as opposed to freelance contractors: it creates a harmonious and well-oiled team.
The insider knowledge of a mature outsourcing enterprise
Lastly, when it comes to large and already mature nearshore custom software development outsourcing companies, the insider knowledge, the transferable know-how, and the particular insights that such teams can bring to the project far outstretches the added value that individual contractors may bring to the table.
“As a client, when you hire an outsourcing company to build a team, you hire not only the technical skills, but also the access to a certain kind of knowledge solution/application building, that they have, or that they can gather from the wider activity of the company. It’s a combination of technical skills, project management, and soft skills – as a client, the reason you go to outsourcing companies is that you don’t just look for one aptitude, but an integrated whole that can address all your needs,” Sabin Gîrlea continues.
Even though Romania hasn’t experienced a massive exodus of IT professionals, who went freelance, the shift away from outsourcing companies is starting to become visible on the market. Despite the fact that the threat is not an existential one to the Romanian outsourcing industry, clients, IT professionals, and outsourcing companies alike should pay attention to how this trend is developing and draw their own conclusions as to what may work best in their favor.