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Why nearshoring is so important in a time of digital disruption

A Picture of Alex Robbio
May 14, 2019 | Topic: Nearshore  
Why nearshoring is so important in a time of digital disruption

Regardless of which business newspapers or websites you have read in the last month, chances are you will have seen at least one article that showcases the importance of digital transformation. And with good reason: traditional business models and industries are changing at a fast pace. Uber, AirBnB and SpaceX are just three examples of an ever-growing list of disruptors that are quickly transforming business landscapes. And even they now face disruption – for example, blockchain-based businesses may well soon threaten the centralized model of platform companies such as AirBnB.

But increasingly, traditional businesses are embracing digital transformations and becoming change leaders themselves instead of waiting for a disruptor to enter the market. Nearshoring is playing a crucial role in this process, because it’s the most effective way when working with partners to ensure you have the skills, resources, and capabilities to enable this transformation.

Business need to respond rapidly to a constantly changing environment

A core driver of enterprises’ need to transform, is that their customers have vastly different experiences than they did just a few years ago. Forrester Research calls this the “Age of the Customer”. Meanwhile, authors Nick Worth and Dave Frankland refer to the “entitled consumer”, and argue that we’re all becoming more entitled every day.

No longer is it enough to get free delivery when making a purchase – we want it to be delivered immediately. We want banks to understand our financial needs, and offer just the services that are appropriate for our situation – rather than continuing to push a credit card offer that we’ve already declined five times. They cite the example of Apple Pay, and if it fails, and a consumer has to use their credit card instead, the consumer now actually feels let down by the company.

Nearshoring and Agile development form a strong basis for a digital transformation

Developing the kinds of products and services that entitled customers want, requires organizations to be flexible, and able to quickly respond to changing requirements, all while staying on top of a rapidly changing technological environment. To achieve this, we see companies investing in digital transformations – revising and improving their organizational processes, taking advantage of the latest technologies such as machine learning and augmented reality, and improving their capabilities in developing powerful applications.

It’s much easier to do this, when you can work side-by-side with your partner, having conversations every day, to experiment and work closely together. This is where nearshoring and Agile development plays a key role.

This is because Agile provides the framework for rapid iterations and constant adaptation depending on what customers want. Nearshoring and Agile development are joined at the hip. Having a partner located in a nearshore location, rather than offshore, means you can practice real Agile, with real-time communication, rather than a modified version of it.

Meanwhile, cultural alignment has become a lot more important as processes have become more agile and teams have become more integrated. When two teams are constantly working closely together on a multitude of tasks, the degree of team integration plays a key role.

It’s worth highlighting the perspective of Agile development co-founder, Alistair Cockburn, who visited Belatrix earlier this year. We asked him about his perspective on distributed Agile. In his response, he said Agile works best when people are in the same room, “looking face-to-face”.

In today’s world, where distributed teams are the norm, he highlighted two crucial elements to be successful: firstly, when people are in different locations, you have to use technology to replicate this, such as cameras, big screens – to enable this real-time communication. And secondly, you have to have regular in-person meetings, so people get to know each other.

In both of these aspects, nearshore locations have clear benefits – in the first aspect, the timezone overlap means you can use technology to its fullest extent to meet and talk everyday with the team. In the second aspect, flying to a nearshore location is so much easier, as the travel time is shorter and there’s no jetlag. Cultural similarity here is also key.

Agile and nearshore are a potent combination in the digital world

Organizations that are embarking on their digital transformation journey are driven by the need to change. They understand that digital technologies are changing the nature of business, and how businesses engage with their customers.

New competitors are emerging rapidly, and from unexpected quarters. Thus as enterprises undertake these transformations, they realize they need to not just invest in new technologies, but also re-evaluate core processes and their organizational structure. It’s for this reason that Agile development provides a highly effective structure and approach for digital transformation.

At the same time, organizations understand that partners can provide experience and knowledge in new areas – and being able to communicate in real-time with your partners has never been more important.

Also published on Medium.


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