In today’s global economy, businesses have different options when it comes to outsourcing services, like “Offshore Service” and “Nearshoring”.
In the context of ServiceNow, a cloud-based platform for IT Service Management (ITSM), offshore services and nearshoring are two outsourcing models that companies use to expand their ServiceNow operations. Here’s how these approaches apply to ServiceNow:
What Are Offshore Services and Nearshoring?
Offshore services refer to outsourcing business processes to different countries, including different time zones, typically in regions with lower labor cost. Offshore services in terms of ServiceNow involves hiring a remote team on distinct locations to provide ServiceNow support, development, or implementation at lower labor cost.
On the other hand, nearshoring involves outsourcing business processes to neighboring or nearby countries. Nearshoring provides advantages in terms of geographically similar time zones.
Also Read Understanding the Dynamic Evolution of Offshore Services
Key Factors to Consider While Choosing Offshoring or Nearshoring
1. Cost Efficiency
a. Offshore Services:
- Lower Cost: Offshore service is mostly chosen for the cost-saving potential. It provides access to a broader talent pool while reducing labor costs.
- Operational Saving: You can reduce cost related to internal teams such as salaries, benefits.
b. Nearshore:
- Moderate Cost Saving: It offers some cost saving, but it is generally more expensive than offshoring.
- Better Balance of Cost and Proximity: Provide good balance of cost efficiency and easier collaboration compared to offshore team.
2. Communication and Time Zone
a. Offshore Services:
- The ServiceNow Support Offshore teamis located in different time zones, which may lead to communication delays and response time.
- Offshore teams work asynchronously, it means progress might slow during overlap hour. To 24/7 support model, this works well, as issue can be worked on around the clock.
- Language and cultural barriers might impact project effectiveness.
b. Nearshore:
- It offers a minimal time zone difference, which facilitates easier collaboration and more synchronous communication.
- Makes it easier to schedule meetings, track progress, and provide quick response to issues in your ServiceNow implementation or customization.
- Often share cultural similarities and business practices.
3. Cultural and Language Compatibility
a. Offshore Services:
- ServiceNow Support Offshore team might have language differences that can lead to misunderstanding and miscommunication.
- Offshore teams and domestic teams have significantly different work culture and business etiquette.
- Require more efforts and clarity to ensure requirements and understanding.
b. Nearshore:
- Provide advantage of shared language and cultural alignment.
- Similar cultures lead to better communication and better understanding of project scope.
- Because of the small cultural gap, the nearshore team is more familiar with work practices, it reduces chances of miscommunication.
4. Access to Talent and Expertise
a. Offshore Services:
- The ServiceNow Partners Provide access to a wide range of highly skilled professionals in fields like ServiceNow development, IT support, and consulting.
- Many offshore locations have specialized ServiceNow Partners and certification programs, accessing advanced expertise in areas like ServiceNow integration, automation, and customization
b. Nearshore:
- Provides access to fewer specialized ServiceNow resources than offshore locations but better allocation with industry standards and compliance requirements.
- Make verification credentials and face to face interview easier.
- Talent pool may be smaller compared to offshore but often offer more experienced and well-rounded professionals and well versed in both the platform and business environment.
5. Legal and Compliance Requirements
a. Offshore Services:
- Complex regulatory requirements and data privacy laws can make offshore operations challenging.
- Different countries have varying standards for data protection and security compliance, requiring additional oversight.
- Need to carefully review and maintain compliance with international laws, particularly for sensitive ServiceNow data handling.
b. Nearshore:
- Often operate under similar or compatible regulatory frameworks, making compliance easier to maintain.
- Closer geographical proximity allows for better oversight and faster resolution of legal issues.
- Typically share similar data protection standards and business regulations, reducing compliance risks.
Pros and cons of Offshore and Nearshore Services
Get more information on Offshore Outsourcing: Know 10 Benefits for Business Growth
Real-World Examples
Here are some real-world examples of how companies have successfully implemented both offshore and nearshore ServiceNow solutions:
- Global Tech Company: Utilized offshore ServiceNow Partners team in India for platform customization, automation and development, while maintaining nearshore support team in US based enterprise for real-time incident management and user support.
- Healthcare Organization: Partnered with nearshore team in Canada for ITSM implementation, ensuring strict compliance with healthcare data regulations while maintaining cost efficiency and clear communication.
- Financial Services Firm: Adopted hybrid model combining offshore development team in Philippines for routine maintenance and nearshore team in Costa Rica for critical business process automation and client-facing solutions
Best Practices for Making the Right Choice
When deciding between offshore and nearshore services for your ServiceNow implementation, consider these key practices:
- Conduct a thorough assessment of your organization's specific needs, including budget constraints, communication requirements, and technical complexity of projects.
- Start with a pilot project to evaluate the effectiveness of your chosen model before committing to a full-scale implementation.
- Establish clear communication protocols and performance metrics from the beginning to ensure accountability and measure success.
For more insights read 10 Crucial Tips for Optimal ServiceNow Partners Selection
Conclusion
Choosing between offshore and nearshore ServiceNow services depends on your organization's specific needs and priorities. While offshore services excel in cost savings and access to a large talent pool, nearshore options offer advantages in communication, cultural alignment, and regulatory compliance. The key is to carefully evaluate your requirements across all dimensions - from budget and technical needs to communication preferences and compliance mandates - to make an informed decision to pick ServiceNow partners that best serves your business objectives.
Contact inMorphis now and discover the right ServiceNow Support model for your business.
