Onshoring vs. offshoring is the wrong way to think about IT hiring

By Patrick Gray September 25, 2014

If you find yourselfasking whether to shift your company's development activities onshore oroffshore, you may be asking the wrong question.


In IT, offshoring hasbecome a loaded term. For some, it's a magical cure-all whereby high-qualitydevelopers can be acquired for pennies on the dollar compared to local talent.For others, offshoring is a borderline conspiracy to destroy high-end, local ITtalent. IT leaders generally fall somewhere on this spectrum, and at some pointin our careers most of us are faced with a decision on whether to outsourcetalent. 


Separate location fromquality

nmany cases, discussions about offshoring vs. onshoring are really discussionsabout balancing quality and cost. While geography certainly factors into costof living and salaries, the best talent commands rates commensurate with thattalent regardless of where in the world it exists. IT work in particular can beperformed half a world away; talented resources know this and charge whatthey're worth compared to resources around the world. Even if it were oncetrue, the myth of PhDs in Computer Science charging sub-minimum wage rates hasvanished. Whether it's a massive global firm making these promises, or your ownHR department, resources with that level of talent are surely smart enough torealize what they're worth.

Thereare other benefits to geographic diversity. Augmenting local talent withresources in other locations can provide the legitimate and obvious benefit ofdriving productivity around the clock, or supporting multiple languages ortechnical environments. If these are the primary benefits you're seeking byconsidering offshoring, then your head is in the right place. However, if youbelieve the myth that offshoring is shorthand for the impossible promise of toptalent at bargain-basement prices, then you're likely setting yourself up forfuture disappointment.


Onshoring isn't a panacea either

Justas location isn't a perfect indicator of talent or cost, deciding to sourcetalent only onshore will not protect you from low-quality resources, or themyriad other issues that can arise when you bring on a new employee orcontractor. Just as talent in far-flung geographies can provide certainadvantages, so too can local resources that can regularly interact with keystaff and provide "feet on the ground." For companies that struggleto integrate telecommuters a dozen miles outside town, keeping talent local mayprovide a better cultural and logistical fit than companies with decades ofexperience working with employees around the world.


Starting with location is backwards

Inall but a few limited circumstances, starting your search for talent by makinga binary decision between offshore and local talent is going about the decisionbackwards. Start with a clear understanding of what you're trying to accomplishby adding additional talent, and considering the skills and experience thatwould best fill that objective. Only when you have a clear understanding ofwhat the new employee or contractor will do, and what skills are required,should you consider whether the role would best be served onshore or offshore.For some roles, skills and experience may be more important than location.Ideally, this role could also be performed remotely, allowing you to sourcetalent from anywhere in the world.

As ITleaders, we've been conditioned to consider the location of our talent tooearly in the talent acquisition process, as if geography were the ultimatedriver of cost and quality. As many IT leaders can attest, this is a misguidednotion. Like hiring shortcuts ranging from certifications to personality tests,making assumptions about onshore versus offshore talent may seem attractive,but it's one shortcut that's ultimately doomed to fail.