13 Jun 2018
Vietnam Software Outsourcing: A Promising Destination for Outsourcing Software Development Project

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Vietnam Software Outsourcing: A Promising Destination for Outsourcing Software Development Projects

(Article updated: 27th Nov 2019)

In the recent years, Vietnam has become an emerging market for software development outsourcing in the global tech community. Competitive outsourcing cost combined with highly skilled IT workforce and top tech talents make Vietnam an attractive choice for companies that are looking to outsource their software and mobile application development projects.

In addition, prominent US tech companies such as Intel, IBM, and Microsoft etc. have been actively and continuing investing in Vietnam. Many tech companies from other developed countries such as Japan or Australia have already set up offices and hiring software developers to work on their projects in Vietnam in the past few years. The trend is becoming more and more popular.

In this article, we will focus on the current state of the Vietnam IT industry as well as identifying the main benefits of outsourcing IT projects to Vietnam, in order to help you make an informed decision choosing your ideal outsourcing vendor.

THE BENEFITS OF OUTSOURCING SOFTWARE DEVELOPMENT PROJECTS TO VIETNAM

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Vietnam joins the Global IT Workforce

Today, Vietnam is developing at a lightning speed, and this has resulted in a surge of innovative experts in different industries, among which IT professionals really stood out. In 2017, Vietnam has jumped five places to rank sixth in Global Software Outsourcing industry according to the Global Services Location Index (GSLI) released by management consulting firm A.T. Kearney - and has subsequently moving up jumping to the fifth place in the same A.T.Kearney's 2019 Global Services Location Index.

While Vietnam software developers have achieved great results and are getting recognized around the world for their high-quality work and creative ideas, the economy in Vietnam is still at the developing stage and playing catch up with other developed countries. This particularly makes hiring software developers in Vietnam extremely beneficial: On-shore tech companies receive high-quality IT works at a price that is much lower than the average rates in their own countries.

And reasonable rates are not the only noticeable benefit that entices companies to outsource their business to Vietnam. Here are other reasons to outsource to Vietnamese software companies:

  1. Young, dynamic and well-educated workforce

Many developed countries have been suffering from the problem of tech talent shortage for quite a while now. By contrast, Vietnam is now going in the opposite direction — the number of talented IT developers has been constantly growing. Tech corporations can benefit from these tendencies — by choosing skilled software developers from the vast tech talent pool in Vietnam and cooperate with them through the extended team model.

  1. High-Quality Technical Education 

The quality of technical education at as well as self-studying and research is getting higher and higher at Vietnamese universities day by day. Education is one of the main reasons Vietnamese tech workers rank among the best software developers in the world.

  1. Convenient Travel Location

The time difference between Vietnam and other Asian countries is one to a few hours on average, which is practically negligible for efficient daily communication. Moreover, traveling within Asia is very convenient, as you can reach most Asian tech hubs within a couple of hours from Ho Chi Minh City.

There are also direct connecting flights with major European and US cities available throughout the day. Although travel time takes obviously longer, a maximum time difference of below 24 hours still makes it possible to set up efficient cooperation with the help of daily sync-ups and flexible working hours.

  1. Cutting-edge technologies 

Vietnamese tech workers always keep up to date with the newest technology for instance Blockchain, Internet of Thing (IoT), Machine Learning, Cloud Computing etc. and are not afraid of new challenges. Furthermore, Vietnamese developers possess strong technical skills as well as hands on experience working with complicated large scale IT projects that are being used by millions of people worldwide.

  1. English Proficiency

According to EF Education, Vietnam ranks 29th on EF Education First’s English Proficiency Index overall, ranking at 5th place among Asian countries. Educational institutions in Vietnam have also been implementing teaching English as a second language on campus (rather than just a foreign language). This will definitely help increase student mobility and international workforce collaborations.

English skills among Vietnamese IT professionals are usually higher than the country’s average. This, and many other factors, undeniably makes Vietnam one of the leading IT outsourcing destinations worldwide.

How to Choose the Right Software Outsourcing Company in Vietnam?

With the increasing availability of software outsourcing companies in Vietnam, choosing the right one could be quite a challenge for your business. Before finalizing on the potential outsourcing vendors in Vietnam, it’s important that you have a clear understanding of your software development goals, success metrics, and growth targets. Some of the basic factors that need to be considered:

  • Sufficient/Fluent English and communication skills
  • Domain knowledge and industry experience
  • Developers’ expertise in the required technologies
  • Quality standards
  • QA and testing
  • Pricing model and software development methodology (e.g. Agile)
  • Etc.

All in all, it’s also preferable to seek out a company that already has a proven software development process in place, together with transparency and offers flexibility in terms of changes for your project.

How to Effectively Manage an Offshore Outsourcing Team in Vietnam?

Even though the software developers in Vietnam are highly skilled at what they do, effectively managing an offshore team could be entirely a different matter. To effectively manage a remote team in Vietnam or any other offshore reason, here are some of the tips that you can follow:

  • Communication: established frequent communication with the development team in Vietnam to keep track of project progress and provide feedback as well as any changes if necessary. Video conferencing tools such as Skype and/or Zoom can be used to communicate face to face.
  • On-site visits: conducting on-site visit in Vietnam will allow you to get to know the team better, which makes collaboration and team building more fruitfully.  
  • Use project management tools: such as JIRA, Trello, or other similar collaboration tools for easier tasks and progress tracking.
  • Feedback: providing feedback helps move the project forward efficiently, at the same time guiding the developers on the right track.
  • Encourage the team: when hiring offshore Vietnam software developers, you should try to treat them as if they are a part of your in-house team. Also try to encourage and listen to their feedback on the development which could be helpful in improving your product.

THE RISE OF DEMAND FOR EMERGING TECHNOLOGIES OUTSOURCING PROVIDERS

At the rapid rate which technology develops, the demand for IT specialist who are well-versed in advanced and emerging technologies (e.g. Blockchain, Machine Learning, and Data Science etc.) will continue to rise. Even companies who already have their own in-house team of software developers can benefit from outsourcing, especially when it comes to projects which require the beforehand mentioned innovative technologies.

Based on a report by Statista, the global market for outsourced services has grown steadily and strongly from $45.6 billion USD in 2000 to $85.6 billion in 2018. Additionally, according to a report by marketreportsworld, it is forecasted that the IT Outsourcing market continues to grow at a CAGR of 4.42% during the period 2019-2022. Such figures indicate that software outsourcing continues to be a strong force in the coming years.

Even though shortage of IT talents has made it difficult for companies to hire qualified software engineers in the US, however, skilled developers are available in other regions such as Eastern Europe, Asia, and in particular Vietnam.

Why TP&P Technology?

As mentioned above, when it comes to choosing vendor and hiring candidates, there are many factors a company need to carefully consider before making the final decision, including: the specific business requirements, the technologies, the desired skills of developers, the operation cost etc.

Our team is here and ready to provide you with top software engineering talents in Ho Chi Minh City, the Silicon Valley of Vietnam.

TP&P’s management group is among the most accomplished in the industry, who are former co-founders of leading IT corporates in Viet Nam.  With our deep experience in many tech fields and team of highly skilled software developers on board, we possess the expertise needed to turn your idea into reality and provide you with 24/7 support during the process, ensuring the highest quality at a very affordable cost.

For more information, get in touch with us today.


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