There is a big cultural difference in offshore outsourcing. American programmers have a higher comfort level with speaking up and offering suggestions. A good software developer can say, what you have been asking did not make sense. While on the other hand, the Indian programmer will mention, though it doesn’t make sense, it is what the client wants. Thus it may happen that, work takes more time then you anticipate. Also, common scenarios in the US like creating an automation system for a customer credit card or using handheld pam devices for any application is very common for US programmers while it can be a foreign concept in India. Also, the majority of Indian IT companies are very young. Their average age is below 27 years.
So all factors affect around 20% of work decline in the efficiency of application development. However, this gap gets smaller and smaller as people work together. So in the initial phase, the cost of software development can be higher but it decreases eventually. Also, there can be other factors like the high turnover of offshore programmers. The attrition rate is very high around 35% because of many multinational companies opening their offices in India and offering salary higher then what a programmer is getting. So it is always good to address this issue in the contract while dealing with offshore providers.
The last problem is communication and ascent. Offshore software programmers don’t interpret issues as easily as in the US. Also, ascent makes problems. General communication takes place by phone line but in smaller companies often it takes place on messengers, skype, or IP phones.
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