8 Common Offshore Software Development Challenges

Last Updated on 2025-03-19

Software development isn’t always a smooth journey, and offshore software development poses some unique challenges. We always have to be on the lookout and prepare for the possible risks we can encounter.

In this article, we’ll talk about the most common offshore software development challenges, and show you how to manage them. Trust us, you’re gonna need to take note of these.

Offshore software development boasts cost savings, but oftentimes, it presents many challenges that are not made apparent until it’s too late. If you’re considering offshoring your software development, you’re definitely not alone.

According to a recent survey by Deloitte, 65% of respondents plan to build offshore software development teams in realms specific to big data, business processes, enterprise mobility, and cloud computing, to name a few.

Put simply, offshore software developers complete the project(s) more inexpensively because their hourly rates are well below U.S.-based software development teams, contractors, and employees.

For example, U.S. staffing agencies charge fixed-fee rates, typically between 25% and 50% of the project cost, UPFRONT. That’s a big chunk-o’-change when looking at project timelines and requirements.

Additionally, with the advancements in cloud computing, the workplace location of your team has become much more flexible. However, the enticement of dramatic cost savings isn’t always what it’s cracked up to be.

List of 8 Common Offshore Software Development Challenges

Here are some of the top offshore software development challenges that cause some experts to recommend against the practice:

1. Less-Than-Desirable Cost Savings

Needless to say, companies lose financial ground when they work with less-competent developers. This means that a less expensive hourly rate is offset by more hours of work spent due to offshore developers lacking experience.

This results in lower productivity and more debugging across the entire project. Essentially, it is Brook’s Law in full swing – assigning more developers to a project actually causes it to take more time, not less.

Allocating major internal resources to manage your team and the overall project is something companies will have to take into consideration as well.

2. Poor Code Quality

When working with a team you don’t know well, quality control can be difficult. Offshore developers may operate under different assumptions about business practices and project management.

This can result in a product that doesn’t meet your expectations. Also, you could be working with recent college IT graduates or inexperienced developers. That’s why the development community embraces best practices—however, not all offshore developers adhere to those standards.

3. Nightmarish Logistics

When working with an offshore development team, carefully coordinating deadlines, meetings, phone calls, and different work expectations to keep everyone on the same page is crucial.

Take into account the drastically different time zones, which may require middle-of-the-night meetings, and you’re looking at longer turnaround times.

These logistical problems, among many others, can quickly become serious frustration. This can result in budget, timeline, and scope excesses.

4. Miscommunication Due to Language and Cultural Barriers

Take just these two things into consideration, and it’s easy to see why offshore development teams may not accurately understand requirements or overall business strategy, leading to more errors.

Functioning in different languages makes it difficult to communicate niche/nuanced needs or understand problems that arise during development. Cultural barriers can also derail projects due to different expectations or communication styles.

5. Unclear Goals and Unrealistic Expectations

Clients not presenting clear goals is, by far, the most commonly cited challenge when working with offshore software development teams. It’s not surprising, given complaints about unrealistic stakeholder expectations are common for both offshore and local projects alike.

6. Code (Can Be) Replicated and/or Sold

Business norms in some countries do not enforce non-disclosure agreements (some even prevent enforcement). When you work with a developer, your intellectual property is being shared as ideas.

Thus, your code becomes your most valuable asset. You will need to have proper legal agreements in place to ensure you own the code.

7. Process Discipline Not Always Achievable

In a typical Scrum meeting, the entire team develops requirements and works together to choose tasks, map out sprints, reviews and report progress. Trying to operate across different business cultures can slow down even the most well-oiled, agile machine.

How? When that model is transposed onto an offshore environment, the entire process is undermined. Why? Because there are no face-to-face meetings, no brainstorming sessions, or even similar working hours.

Therefore, problems arising among team members are inevitable; creating an effective solution while delivering value is very challenging.

8. Increase in Competition

Day-by-day, new offshore software development teams are being deployed all over the world. Due to this rising competition, many small-scale software development companies find it hard to survive.

Finding new and creative ways to find and keep quality offshore development teams is becoming more challenging, but it can be done.

Resolve Offshore Software Development Challenges

Of course, not every offshore development project will end in disaster. Also, there is no need to view offshore developers with suspicion. However, succeeding and overcoming these common offshore software development challenges takes time, resources, and meticulous planning.

You and your team need to be fully aware of the potential for frustrations and hang-ups and have a realistic view of the big picture. Failure to anticipate problems, and not having ways to negate them, will prove costly.

It helps if you have the right resources with the right skill sets and work culture.

If you need help finding the right resources, we can help you! Don’t hesitate to send us a message. We will help you build your team fast, and adapts to help you with your long-term growth plans.

Full Scale was founded by business owners specializing in finding affordable access to highly skilled programmers, designers, and testers for years.

To find more about what Full Scale does and the problems we are solving, listen to Startup Hustle, a podcast hosted by Full Scale’s founder and CEO, Matt Watson.