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XR Outsourcing Trends 2019

While software is said to be eating the world, immersive software developers and other technical talent remains in short supply. This shortage has led to intense competition among major tech companies to hire the best engineers. It has also resulted in an increase of using remote working freelancers and offshore studios. Outsourcing has become 2019’s hottest trend in the world of immersive technology and extended reali

Companies prefer to outsource development services due to the reasonable pricing and the wider selection of tech talents available. With more businesses choosing to outsource immersive software development, it is no surprise that this trend is consistently changing and evolving.

This article shares the key XR outsourcing trends for 2019.

Trend #1: Change of key outsourcing destinations

Although India and the Philippines remain the lead destinations to deliver outsourced IT services, Eastern European countries are gradually catching up. Poland, for example, is now featured in the Top 5 of the Top Coder Statistics, alongside China, Japan, the Russian Federation, and the United States. In fact, Poland ranks #3 in the average score of the HackerRank challenges, with Ukraine in the Top 20, leaving India and the Philippines far behind.

There has been an increase of Eastern Europe’s software developer population, with an average of 15,000 IT talents graduating each year from Polish and Ukrainian technology universities. This growth is predicted to change the primary outsourcing destinations from Asia to Eastern Europe.

Trend #2: More than one vendor

In the past, it was common to outsource software development services to a single vendor. However, the trend is now shifting towards having several vendors available. It is far more reliable to partner with a vendor who specializes in a narrow technology stack, rather than those who claim to be full-stack vendors and deliver work of average quality. It is safer for the client to collaborate with multiple vendors if their project requires several technology stacks.

Outsourcing multiple vendors is beneficial, with 34% of companies now rating themselves above average regarding work with more than one vendor, according to the latest Global Outsourcing Survey by Deloitte.

Trend #3: Tech talent hiring platforms

It is still common for clients to cooperate with local companies that specialize in building offshore development centers. The local company begins by hiring a team from their internal talent pool and “attaches” this team to the client’s project. The client then collaborates with the same company throughout the project and communicates with the developers via a project manager. This is a more “traditional” way of outsourcing that differs from the tech talent hiring platforms’ approach. Through such platforms, the clients browse the developers’ profiles and select the developers that fit the project requirements. After conducting interviews with the developers, the client forms a team for the project.

Tech talent hiring platforms differ from freelance portals in that the developers work at local web development shops, rather than being self-employed. The client signs a contract with one or several web shops. Unlike traditional IT outsourcing, this platform allows the client to communicate with the developers directly and scale the team, if necessary.

Trend #4: The Managed Marketplace Era

There has been a rise in the number of full-stack or managed marketplaces in the last few years. In other words, an increase of marketplaces that take on additional operational value-add in terms of intermediating the service delivery. While “Uber for X” models were suitable for simple services, managed marketplaces evolved to address complex services of higher price  that required greater trust.

Managed marketplaces assume additional work of influencing or managing the service experience, thereby creating a step-function improvement in the customer experience. Rather than merely enabling customers to discover and build trust with the end provider, these marketplaces take on the responsibility of creating trust.

Takeaway

Outsourced immersive software development is continuing to grow rapidly, with the following trends predicted for 2019:

  • Top outsource destinations are very likely to shift from Asia to Eastern Europe.

  • The clients are more likely to choose more than one vendor for outsourcing.

  • The clients are likely to take advantage of tech talent hiring platforms.

  • Managed marketplaces are a tactic to solve a broader problem regarding accessing high-quality supply.

The NINJAR platform, part of the InnovationPunks portfolio, is building a managed marketplace for 3D, AR, and VR services.

  • NINJAR interviews and screens every XR professional prior to onboarding and provides new customers with a project manager to establish a personalized development team.

  • NINJAR creates a radically different experience for designing and developing immersive experiences. This platform selects the developer profiles that fit the client’s project requirements, creates a team, and handles the project from ideation to roll-out.

  • NINJAR overcomes the obstacles that arise when hiring an agency, such as the hassle to find the right talent, quality control, no fixed pricing, and potentially months of uncertainty.

The shortage of immersive engineering talent is one of the key problems the tech industry faces today. At InnovationPunks, we believe that such shortage can be avoided when companies know where and how to look. This involves learning how to navigate other countries’ labour markets and locating reliable suppliers – a difficult and time-consuming task. NINJAR is the only solution that proudly assists clients throughout the entire journey, from initiating their remote operations to scaling their development centre.

For companies looking to get into VR/AR/MR our Virtual Reality services offer guidance on how these technologies can enhance and support your brand strategy.

Connect with us on LinkedIn and follow @ninjar on Twitter or send us an email to hello@ninjar.com

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