What is ODC and How Can It Benefit Your Business?

Currently, there is a significant shortage of talent worldwide, particularly in the IT sector. Experts anticipate that by 2030, companies could collectively lose $8.4 trillion in profits if they fail to address this challenge. To mitigate this issue, many organizations are turning to outsourcing and outstaffing strategies. According to Statista, the global outsourcing market was valued at $92.5 billion in 2019, with a considerable portion attributed to Offshore Development Center (ODC) services.

What Is ODC?

ODC stands for "Offshore Development Center," which refers to a team of software professionals working remotely to provide tailored software solutions and support to clients located in various regions. These centers are typically established in countries with lower costs and a skilled workforce. The primary advantage of an ODC is its ability to offer cost-effective software services, including design, development, testing, and maintenance. ODC teams can manage a wide range of software projects, from simple applications to intricate enterprise systems.

Often, ODCs are owned and operated by offshore outsourcing companies or IT service providers, which may also have offices in the client’s country. The ODC model presents several advantages, including cost savings, access to talent, and the flexibility to scale resources according to project requirements. However, potential risks must be considered, such as communication and cultural differences, as well as concerns regarding data security and intellectual property.

Who Needs an Offshore Development Center?

ODCs are particularly beneficial for technology companies seeking specialized skills to develop innovative solutions. Examples of such companies include:

Software developers
IT service providers
E-commerce platforms
Telecom operators
Cloud computing firms
Fintech companies
Data vendors
IoT businesses

These organizations depend on ODCs to access skilled and experienced developers who can assist in achieving their objectives. ODCs provide flexibility, scalability, and cost-effectiveness for both startups and established enterprises.

Key Benefits of Offshore Development Centers

An offshore development center can offer a multitude of advantages for organizations, including:

Access to a Skilled and Diverse Talent Pool
ODCs can help you recruit highly knowledgeable developers from countries such as Ukraine and Poland, where the hiring process tends to be quicker and more efficient than in the U.S.
Increased Efficiency and Reliability
ODCs can deliver development projects more quickly and effectively, leveraging their expertise, established infrastructure, and competitive pricing. Clients can rely on them to provide high-quality services and meet deadlines.
Access to Established Infrastructure
ODCs can offer the necessary infrastructure and personnel to outsource development projects without the complications associated with global project delivery. Attempting to develop IT applications independently would require significantly more time and expense.
Reduced Development Costs
By offshoring to countries like Vietnam, you can potentially save up to 40% on development costs. Additionally, you can benefit from lower taxes, labor costs, and operational expenses.
Focus on Core Business Activities
If your primary business isn't IT-related, managing an internal IT department can be overwhelming. Outsourcing complex IT tasks to an ODC can free up time and resources for other vital and revenue-generating activities.

How To Set Up an Offshore Development Center

To establish an offshore development center, consider the following steps:

Choose a Location
Eastern Europe and Asia are the best regions for IT companies due to their affordability and rich talent pool. Vietnam, in particular, is gaining popularity because of its skilled IT specialists, rapidly growing tech industry, and strong ties to the U.S.

Why Vietnam?
Vietnam is emerging as a prime destination for IT outsourcing, boasting a large and proficient IT workforce. Recent statistics show that Vietnam has attracted USD $438.7 billion in foreign direct investment (FDI), with a significant share directed towards the IT sector. The country has approximately 480,000 IT engineers and produces around 57,000 IT graduates annually. Furthermore, a considerable portion of Vietnamese developers (59%) are at an intermediate level or above, and many (53.97%) fall within the 20-29 age range. Vietnam also ranks 7th in Asia and 60th globally for English proficiency, facilitating effective communication with international partners.
Find a Reliable Partner
Look for a partner who can navigate local laws, regulations, and culture, and help you connect with a competent team for your project.
Start Recruitment
The quality of your output hinges on the talent you collaborate with. Therefore, it’s crucial to recruit experienced programmers with proven skills and solid references. Establishing strong partnerships with clients is also essential.
Find an Office
Identify a suitable offshore development office where your software engineers can work and have access to all necessary resources. The workspace should be comfortable and conducive to productivity and creativity while also leaving a positive impression on visitors.
Get Legal Support
Legal assistance is essential for safeguarding your interests and negotiating favorable contracts. Local legal experts can help you navigate the regulations of the country in which you operate.
Make Procurements
Equip your offshore development center with the latest technologies and tools, ensuring that your purchases align with your needs and budget.
Organize HR and Payroll
Efficiently managing your accounting and payroll system is vital. You will need an accountant to handle invoices and payments, a specialist to ensure compliance with tax and labor laws, and someone to monitor employee performance and satisfaction.

Leverage ODC for Business Success with Aegona

Establishing an offshore development center can be complex, but assistance is available. At Aegona, we offer comprehensive solutions for companies looking to create their own ODC. From recruitment to procurement, we provide everything you need. Contact us today to kickstart your journey!

The team selection process for your hire offshore developers project is carried out by Aegona in stage 6:

Offshore development center in Aegona

Generate knowledge about your organization: A specialized group specifically selected to fit your organization's needs and culture. Our team of minds can focus and quickly understand how your business works and what it needs.
Fast team formation: Our team formation is fast and flexible. Our team is allocated a variety of projects with increasing demand with staff always ready to redevelop the project.
Pre-screen apps: We don't want you to waste time adding the wrong team members, so we pre-screen all app sources in the team for your business, Always put your needs as the highest priority.

Offshore development center in Aegona

Manager delegation: We always take on a dedicated team manager. This fill-in works with you to build a team with the right skills for your needs.
Building strong relationships: We have a proven history of successful, long-term relationships with customers globally. Our professional team is adept at building long-term relationships and working together effectively.
Retention and Growth: We prioritize your success by focusing on maintaining well-developed HR processes and regular, honest communication. Our experts are well-managed and communicated throughout the projects.

AEGONA LTD - IT SERVICE & SOFTWARE DEVELOPMENT
Email: contact@aegona.com
Phone: Office: (+84) 28 7109 2939. Hotline: (+84) 91 451 8869 | (+84) 83 940 5469
WhatsApp: (+84) 91 451 8869
Website: www.aegona.com, www.aegona.vn
Address: Orbital Building (QTSC Building 9), Quang Trung Software City, District 12, Ho Chi Minh City, Vietnam.