Social Benefits of Nearshoring

Posted by InterVenture on March 16, 2018

Handshake above wooden desk

As new technologies continuously emerge, having a virtual team taking care of different IT and software solutions became commonplace. Outsourcing is a handy option for companies who want to focus on business development or other factors rather than software development. It can be due to lack of time or staff, or simply a way to unlock new possibilities by bringing in professionals to solve problems and complete projects.

Many companies choose nearshore software development as an outsourcing option for its simplicity. The main difference between nearshoring and outsourcing is the proximity of the outsourced team. In outsourcing, it can be anywhere in the world, whereas nearshoring mainly focuses on outsourcing to neighboring or closeby countries, that ideally share a similar working culture, the same time zone, currency and are easier to manage and visit due to the closer distance.

People walking on red sand dune

However, one particular impact of nearshoring deserves special consideration; the social benefits. Many times choosing local is not only good for practical reasons but its social impact. We live in an age where businesses increasingly pay attention to the imprint they leave around themselves in response to consumers’ ever-increasing demands for more ethical and sustainable operations. Companies have to get used to being accountable for the decisions they make, and choosing their outsourcing team is one of them.

So what are the social benefits of a nearshoring partner?

Economic Benefits

When considering Europe, it is evident that the nearshoring partner should be within European borders. Thus naturally, the first direct benefit is economical. As money gets injected into the same trade area, it will remain in its circulation and help benefit all parties within the area creating a win-win situation. Creating jobs for local companies and paying taxes there helps to boost the local economy and ensures that it keeps thriving. In the recent years’ boom for local has also become to stand for quality – choosing local ensures that you will get what you expect.

Greek monument in front of blue sky

Shared Legislation

Choosing an outsourcing team from within the same union also ensures that the legislation is the same and increases accountability. International law can be tricky. Without a detailed contract, modifications might be hard to pursue and solutions could be unclear. Staying within the same legal borders provides security for both parties.

Building a Functional Team

In recent years, companies have realised that social performance should be considered just as much as financial performance. Working in teams is not purely a professional relationship. Teammates should get along well and understand each other without major obstacles. Nearshoring ensures that the cultural background is similar and there are no major barriers to working habits or communication. By ensuring that the team feels comfortable with the collaboration, the work quality should be better too.

All in all, it is easy to see that social and financial benefits are tied together. Creating a well-functioning team takes dedication and hard work. Choosing local companies that share the same values and work ethics can remove some of the burden. Ultimately, choosing nearshoring is not only financially but also socially beneficial for both the hiring and the host company.

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