As we advance in another decade of progress in the technology sector and given the Portuguese government plan to inject more than 15,000 million euros in projects linked to green economy and digital transformation, it becomes significant to understand the emerging trends, so we get prepared for them.
Portugal has all the conditions to become a key IT nearshore location. With a large pool of technological talent and experience in software development, high levels of English proficiency, stable socio-political system, time zone compatibility, flight distance of around 2 hours from the main European capitals, adding to a strong cultural affinity with the European market, Portugal can, and should, look to Nearshore as an important path of economic development.
However, these advantages alone will not help the national industry ad eternal, as the constant growth of state-of-the-art technologies and the need to always bringing added value to the customer, adding to the challenges inherent in hiring, retaining and respective turnover, will have more than ever an effect on purchasing decisions.
Therefore, it is important to reflect, analyze and prepare to proactively respond to market developments and customer expectations.
In the client perspective I highlight:
1. CULTURAL ALIGNMENT
With customers and suppliers working together in widely dispersed teams – a phenomenon even more pronounced in these new times – companies and teams need to pay extra attention to the subject of culture. Businesses that decide to outsource software development to a nearshore services company like Affinity, for example, expect a certain degree of understanding and cultural alignment, that can be comprised of the most diverse matters and that must be considered in the most subtle to the most predominant interactions in the relationship.
Affinity will conduct a particularly interesting webinar on this subject on September 21st , which will feature the participation of AICEP, Evident and Affinity professionals discussing how culture impacts nearshore operations from the sector, client, and team perspective.
2. INNOVATION MINDSET
The implementation of digital solutions and the development of new technologies are common practices in digital transformation processes. However, an interesting aspect still eludes some companies: how to promote a culture of innovation.
Innovation must be spread throughout the organization, from top down. It needs leaders who can foster a culture of innovation, allowing their teams to work and freely experiment with new technologies, models, or methods for example.
While it may seem difficult to “outsource” or “delegate” innovation, when working with a nearshore development company, innovation should become an important extension of the partnership ensuring the space needed to develop innovative projects, increasing capacity in new methodologies or models and leading growth in their own markets.
3. NEW TECHNOLOGY
Technology never stops developing, transforming the way business is done, the way customers relate to companies and the way the dynamics of industries take place. In this sense, it is important for companies to remain open to digital development by adopting new technologies, adapting, and remaining at the forefront of their sectors.
Some technologies that should be considered are AI & Machine Learning, Robotics, Big Data, Cloud, IoT, 5G technology, blockchain or Cybersecurity; these have a big potential to boost different of business types and must be explored and applied in an adjusted manner.
4. FOCUS ON THE CUSTOMER EXPERIENCE
The focus on customer experience is not a new topic, however, I notice a growing trend in this direction, and I believe that in 2022, the success of companies will be widely linked to ensuring a quality experience to their customers.
This becomes, therefore, a pivotal moment for companies to look at their processes and initiatives related to the customer journey, always actively listening to the customer’s needs/interests/values/path – whether in B2B or B2C businesses – and seeking to improve their experience in all formats/platforms/ mobile or web applications they use.
On the supplier perspective I highlight:
1. DATA SECURITY
Security is and should be a priority for technology-related service providers. A vendor must understand how sensitive data can be for businesses and take necessary measures to make the client feel confident on the partnership.
When it comes to outsourcing services, even more internationally, customers are primarily concerned with protecting their data. Therefore, nearshore service companies must demonstrate that they can combine the establishment of high-performance teams, remotely and safely at all times and in all circumstances.
2. AGILE CLOUD DEVELOPMENT
Nearshore service providers will consistently invest in Cloud development solutions as working models with geographically distributed teams evolve both on a nationally and internationally. A team with three elements in Lisbon, two in Porto, one in Obidos and 3 in São Paulo will be normal and companies must be prepared for this.
The development of team decentralization will be an underlying trend. Organizations are adopting a multi-cloud strategy to a large extent, using different Cloud platforms to reduce expenses and improve resiliency.
With companies determined to reduce their operating expenses, the pandemic has increased automation in almost every sector. Vendors should focus on predictive AI technologies, process automation to minimize effort and repetition, robotics, self-service capabilities, and the overall reduction of low-added-value tasks.
One advantage of automation is freeing employees from repetitive work allowing them to move to more challenging and higher-value tasks, while increasing the company’s margins. According to a study by Gartner, by 2024 companies will reduce their operating expenses by more than 30% by integrating hyper-automation technologies with restructured operating procedures.
4. STRONGER CONSULTING SERVICES
I strongly believe that the entire software development process must be oriented towards always greater performance. Without a comprehensive, performance-oriented qualitative approach for everyone – from code development to release, staging, and monitoring environments – quality can decline. This has serious repercussions on delivered applications and can impact reputation as well as associated additional costs.
5. EMPLOYEE EXPERIENCE
The success of nearshore IT service providers will depend on their ability to assemble and scale small, medium, or large teams, geographically distributed, and possibly with different compatible time zones.
The challenges in hiring talent and high turnover are very present. These should be overcome through diversification in national and international recruitment, employee monitoring and development of individual career plans, quality, complexity and diversity of projects, creation of bonds with the company, actions of cultural alignment between supplier/customer among others. In short, provide outstanding experiences to each employee, regardless of their team or project.
The technological industry in Portugal is exhibiting significant growth year after year. Nearshore allows organizations to meet the need for qualified talent, in the early stages of scaling-up the business. For larger organizations, it allows them to rapidly expand globally and reach the top of their sector.
Nearshore service providers must ensure solid consulting services at all stages of a project by being able to honestly share their knowledge with clients, provide valuable advice, train them in a culture of performance, and leverage their full capacity in Software Engineering.
Globally, I believe the trend from 2022 forward will be for nearshore IT relationships to become partnerships under which software development service providers support their client organizations from a global perspective including technologies, processes, people, and culture. And not just providing functionality as a mere service.
Affinity will always assume this vision, seeking to grow with its customers, guaranteeing quality services and relationships.
If you want to learn more about the advantages of a nearshore technology company, now is the time to start!
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Carlos is Affinity’s CEO & Founder. Having started his career as a Technical and Business Consultant, he later accomplished his dream of building its own IT consulting company with a clear focus on people, relationships and affinity. It is with great ambition and focus that Carlos defends its position both in the tech industry as well as in the tennis table!