MSP Today Expert Feature
February 08, 2016

Stefanini Makes the Case for Nearshoring

As long as the concept has existed, there has always been an argument to be made for nearshoring business, IT or service processes rather than outsourcing them. However, none of the traditional arguments are as enticing as when a major global IT outsourcing services company comes right out and says that companies under pressure to deliver cost efficient, high quality application management services can improve operations with the nearshore model.

In this case, Stefanini is the company offering up advice based on more than 24 years of experience in nearshore development services. The key to nearshore success, according to Stefanini, is a disciplined and mature process. With the right processes in order, many Stefanini clients have found the nearshore model to be more efficient in achieving higher percentages of work performed at a lower cost location than they would with offshore.

Cost savings aside, the nearshore model is also superior in terms of collaboration and improved vendor alignment. These are just some of the reasons companies should consider nearshoring over offshoring.

Nikhil Desai, practice manager of Applications at Stefanini North America, cites some real-world examples, saying that companies looking for the best efficiency, effectiveness, collaboration and responsiveness in their partnership arrangements have achieved the best mix of these goals through the nearshore model.

"It is important that clients see Partner (Service Provider) teams as an extension of their organization to drive successful outcomes; real time collaboration and ongoing communication is critical to achieve the same. It is amazing to see how lack of communications in some situations can slow things significantly down, not to mention the impact it has on productivity and quality of services besides creating an environment of mistrust and misunderstanding. Same time-zone nearshore model helps deal with these challenges better than a more traditional offshoring model does," said Desai.

There was once a time when nearshore services were at a relative premium, especially compared to what U.S. companies could find in India, so offshoring became the trend. However, times have changed and a favorable exchange rate makes Brazil an excellent choice for nearshoring, while India is less tenable. In addition, Brazilian market slow down means there’s an abundance of talent available there. In other words, for U.S. companies, nearshoring is the best way to go.