How to manage an offshore development team of 40 or so IT specialists who are far miles away from you? Setting up a remote team, sharing knowledge, aligning internal processes and workflows, the first release - there are a number of challenges at every stage of the IT outsourcing journey. So in today’s article, we reveal the ins and outs of managing software development teams offshore to help you prepare for the IT outsourcing experience.

Some new challenges appear with every new provider. There will always be trial-and-error issues, but if you and your vendor know how to manage remote development teams effectively: prioritize, delegate, and create a collaborative environment, it will be easier to overcome them. In general, these 5 issues we've described in the article can be encountered in all types of cooperation models.

Companies that decide to opt for IT staff augmentation services usually consider such models as an extended team, a managed team, and an outsourced team. The main difference between them lies in the initial client’s need and the degree to which the client allows a vendor to take over project management.

Types of cooperation models depending on the degree to which the client allows a vendor to take over project management.

The extended team model allows the client to get additional development capacity for their existing team while staying fully in charge of product development and team management. Businesses often look for team extension services, because this model suits best for short-term cooperation when you need to scale a project quickly and deliver a product on time.

The managed team model works great for long-term projects. A vendor builds a dedicated development team sharing the risk and responsibility for the final results. They work autonomously from the client’s in-house team, but the outsourced project manager reports to the client’s product owner. Many companies have experienced the advantages of setting up a dedicated development team: cost-effectiveness, flexibility, ease of scalability, transparency, smooth collaboration, etc. 

The outsourced team is the most traditional cooperation model. A vendor is fully in charge of building the team and delivering the solution from the product discovery to the final release according to the deadlines. The client provides ideas and sets out requirements, and the vendor delivers a custom solution that meets the client’s business needs.

Problems with managing offshore development teams and how to solve them 

1. You suffer from high turnover rates on the project


It is challenging to manage a team, which gets constantly reshaped. Onboarding and orientation take too much and delay the software development process. Also, it becomes difficult to build trust, loyalty, and healthy communication between teams, which is essential for a successful partnership.


Poor employer brand is one of the main reasons why employees jump ship. Thus, before partnering with an IT outsourcing company, check whether it provides employees with comfortable working conditions, professional growth, training opportunities, fair compensation, etc. If your vendor’s turnover rate correlates with the percentage of employees who don’t meet expectations, this is a good indicator of business success. But if there is a high turnover rate among top performers, it means that the company doesn’t offer enough benefits and loses out to its competitors on the market.

2. Key project knowledge is lost


There are different types of knowledge transfer. It can be performed from a client to a vendor and between team members with the project to prevent knowledge from walking out the door. Anyways, unshared knowledge costs money. Knowledge loss results in lots of organizational waste when the whole process gets reworked from scratch. If your vendor suffers high turnover rates plus doesn’t have a robust knowledge transfer plan in place, you will face sluggish team velocity which could further lead to significant project delays. 


It is essential to figure out whether a vendor values knowledge transfer and can establish an effective knowledge transfer plan. You can analyze how quickly your team has managed to get started with the project: get the hang of the product and all processes, set up the Development, QA, Staging and Production environments and get access to the systems used team-wide to be able to deploy releases and debug. Note that the shortest period within which it is possible to effectively finish the knowledge transfer process from the client to a vendor is no less than one full successful deployment into production by a new team. 

It is also important that the vendor values the culture of knowledge-sharing on your project. There are different ways how to transfer knowledge within the project: not only via documentation but also via regular Q&A sessions, live training, one-one meetings, tech talks, coffee breaks, etc. 

how to manage a remote development team

3. Your offshore team doesn’t share your values


Cultural differences and uncommon business ethics between distributed teams could also pose some challenges to a manager. Some nations are more independent, while others need more guidance, some tend to please the client at all costs, while others are more likely to be result-oriented. 


You should check whether a vendor has the same business mindset. In terms of business ethics and values, the Ukrainian corporate culture is similar to the Western one. Software developers from Ukraine are open-minded, persistent and don’t hesitate to take on responsibility. They focus only on what matters and are eager to ask questions to understand the peculiarities of the clients’ business. They want to see the big picture to help a customer to plan strategically.

“I find that their work ethic is very good. They’re very committed and highly intelligent and it really shows in their ability to provide us with a large pool of very qualified people.” Software Developer Manager, Orbus Software


4. Poor communication impedes project delivery 


Clear and transparent communication is the key to project success. It includes many aspects on both the client’s and the vendor’s sides. Yet, the main problem arises when remote software developers don’t understand the true client’s business needs. If the client doesn't communicate clearly their goals and overall plans on the strategic level, remote developers can’t apply their experience to the full. Also, if software developers can’t speak the client’s language, are not ready to ask questions, and discuss with the client all the possible ways of resolving issues, project performance is almost certainly guaranteed to suffer. 


First of all, the English proficiency of software developers and their soft skills matter a lot. Also, it is important to use efficient remote communication tools that would help all team members be on the same page and apply best practices to create a motivated, friendly atmosphere. It is also important to include your offshore developers in all communication, avoid an “us vs them” mentality, and try to meet regularly online and in person. Frequent business visits, daily standups, regular planning sessions, retrospective meetings, team buildings, etc. will help establish healthy communication between.

However, the key thing is to be clear about your needs to help a vendor find the best talent that will be both loyal and productive. If your offshore developers are aware of your plans, they can better incorporate your input and enhance your products for the best outcomes.

“The amount of communication is great. I have a weekly call with their business counterpart, which is outside of the team. The developers are in daily communication with our in-house team and give weekly updates to product owners. Their English is amazing. I also appreciate that they do a good job of feeling invigorated and integrated into our company.” Director of Development, cleverbridge

5. Your distributed teams use different tools and have different coding practices


The inconsistent development environment across distributed teams may cause serious troubles: late detection of bugs, downtimes, code integration issues, long release cycles, etc. 


It is essential that all developers across remote teams use a set of defined tools for software development and testing and adhere to the established workflows. And the main task of a vendor is to guarantee that all necessary processes and tools are in place to ensure cross-team collaboration and timely delivery of the solution.

How we manage offshore development teams at N-iX

Here at N-iX, we have developed a time-tested delivery model that proves to bring value to our clients. With some companies, we’ve been partnering for 5-10 years. And that’s primarily thanks to our streamlined delivery processes and a strong employer brand. 

How to manage an offshore development team

It all starts with recruitment and HR activities. We know how important it is for our clients to gather a core team of IT specialists and get the project off the ground as soon as possible. But what is more important is that employees be loyal and productive. That’s why we have 30+ experienced recruiters who thoroughly interview applicants and go beyond what is written in their CV to make sure that a new hire will be a good fit for the client’s team. On average, 3,700+ tech interviews are conducted each year.

To attract the best talent on the market, N-iX promotes jobs via digital marketing channels and invests heavily in its employer brand. We care about our employees, provide opportunities for professional growth, support the local IT community, and launch a number of social and educational initiatives. In 2019, our professionals attended 173 conferences, workshops, and tech events; 32 employees took part in the N-iX mentorship program - an independent service for employees to help them achieve their professional goals; we reimbursed 24 certifications successfully taken by N-iXers. Also, N-iX cooperated closely with schools and universities to educate a new generation of specialists and promote the IT profession among youth.

When a core team is gathered, no matter what the cooperation model the client chooses, N-iX delegates a delivery manager to a project. This person is responsible for the successful cooperation across three key aspects: people, processes, and a product.

In regard to people, a delivery manager is accountable for human resource risk management. Thus, they facilitate specialists’ professional growth and career advancement to ensure high retention rates. Also, a delivery manager builds a successful partner relationship with the client. They manage customer expectations and measure satisfaction regularly, provide financial reports, and help address difficult situations.

how to manage offshore software development team

In relation to processes, a delivery manager is responsible for effective operations management and aligning best practices between the client’s in-house and offshore teams. They help to ensure that the right standards are followed. Regarding planning, these are the right management skills, PMI, PMP, Scrum certifications, etc. Regarding development, these are Continuous Integration, Continuous Deployment practices, automation of processes, and more.

In regard to a product, a delivery manager ensures the timely delivery of a quality solution. Product development is not only about flawless code, and product mindset is first of all about reaching an ultimate compromise: delivering maximum quality within a minimum time span. Thus, educating a team on how to do it is one of the core tasks of a delivery manager.

“N-iX is highly skilled, transparent, and very well structured. They're one of the best outsourced teams I've ever worked with. The Agile, scrum and sprint process they undertake and manage gives us clear visibility on our progress regarding deliverables at any point in time. They excelled in all aspects of project management.” Principle Engineer, Agri-Services Group

Putting it all together

Managing a remote software development team is no easy feat. But if your vendor has experience in integrating remote teams, it would be easier for you to collaborate with the offshore team and achieve your goals. 

Partner relationships are not built overnight. It is important to proceed with baby steps, letting each stage build on the previous one. If you take into consideration the issues above and take measures to prevent them, you will manage to build a reliable team of offshore developers and deliver a robust solution.

If you have any questions on how to find and manage an offshore development team, please contact us. We'll be happy to help you.