Outsourcing has become popular with both big and small businesses as it quickly proves to be an efficient asset. Companies take this step to save money, access professional skills, and successfully execute larger business goals. There are many countries to choose from but Vietnam is rapidly becoming the common choice for software outsourcing.
What Makes The Vietnam Software Outsourcing Popular?
The global tech community has been witnessing Vietnam as an emerging market for software development outsourcing in recent years. Companies search for vital factors when they wish to outsource their software and mobile application development projects, and choose the option they believe will bring them success. These include competitive outsourcing costs, a highly skilled workforce, and top technical talent, all of which Vietnam has an abundance of.
Intel, IBM, and Microsoft are some of the more prominent tech companies that have been actively and continually investing in Vietnam.
The past few years have also seen a surge in Japanese and Australian tech companies setting up their offices in Vietnam, to hire software developers to work on their projects. It is fast becoming a popular trend amongst tech giants and smaller, more moderate technology businesses.
This article will identify the main benefits of outsourcing software IT projects to Vietnam, helping you make an informed decision about choosing your ideal outsourcing vendor.
A Large Portion of the Vietnamese Population Is Under 30 Years of Age
Vietnam has a staggering population of 97 million people and 60% of this population consists of the younger generation; under thirty years of age to be precise. This generation has a growing and high-quality education in technology and those who do not, are self-taught.
The research and dedication of the country’s youth help companies and the Vietnamese economy. As the success in the IT field grows, an increasing number of Vietnamese youth are opting for a career in this business.
This results in their tech workers getting hired by the best software developers in the world.
Why Do Companies Outsource To Vietnam?
Many leading tech companies choose Vietnam for their software development outsourcing. The country offers the best workforce, cutting-edge technologies, and incredible cost-competence which makes the country a favorite outsourcing option. In the latest research report of 2020, Vietnam IT Outsourcing ranked the ninth position in the top 50 digital nations.
Being a part of the top 10 nations, Vietnam became a popular choice for outsourcing software especially after the pandemic outbreak in 2020.
The Vast Pool of Skilled Technical Engineering Graduates and IT Professionals
Vietnam’s progression in the IT field, particularly in outsourcing, is quick and evidenced in multiple ways. One of the most obvious is the way IT professionals have stood out among innovative experts whenever compared to different industries.
Enterprises can fulfill their growing offshore development needs through the vast number of skilled software developers, especially in Vietnam.
The abundance of talent and skill in the technology industry comes with creativity and technical brilliance. They have honed their skills through the use of cutting-edge technologies like Cloud computing, The Internet of Things, and Blockchain. Their expertise in the business offers the best quality of software outsourcing for their clients.
Language Is No Longer a Barrier
In the beginning, Vietnam had to tackle the English language barrier in its competition with other software outsourcing countries; it has managed to overcome that through a series of programs designed to aid in this sector of their work.
The EF Education First’s English Proficiency Index ranks Vietnam 29th overall and 5th in Asia. English is now taught as a second language instead of as a foreign language in Vietnam’s educational institutes. This increases international workforce collaborations and with improved English skills among IT professionals, makes the country one of the leading IT outsourcing destinations in the world.
Competitive Pricing in Vietnam Software Outsourcing Companies
Many companies reduce their costs by outsourcing to Southeast Asian countries and Vietnam is one of the top countries that they turn to. This is because the average salary in Vietnam is lower than others and CIO Magazine has even declared it to be almost 90% less expensive than developing software in the USA.
Not only this, costs charged by Vietnamese outsourcing companies are about 33% cheaper than their counterparts in India or other countries.
Stable Government Policies and Fast Economic Growth Rate
For the last 30 years, not only has Vietnam found a place in the most politically stable countries of Southeast Asia, but they have also experienced rapid economic growth. The World Bank stated that between 2002 and 2018, Vietnam’s GDP per capita rose by 2.7.
This progress came about due to economic stability, effective policies, and proper governance.
Availability of Trusted Vietnam Outsourcing Companies
Worldwide clients look for trusted service providers and Vietnam fulfills that demand. Its variety of software outsourcing companies includes top service providers such as Saigon Technology and TPS Software with customers in Australia, Canada, the USA, Singapore, and a host of other countries.
You can expect the best quality custom software development and outsourcing, web application, mobile app development, and UI/UX design solutions. All of these are offered with exceptional quality and affordable prices.
Growing Global Demand for a Software Outsourcing Company in Vietnam
Vietnam has become one of the best IT outsourcing options in the world due to its unique combination of high-quality services and low prices. The country has become globally competitive due to the young software developers with expert English and IT proficiency.
Global tech companies keep all these aspects in mind when exploring the tremendous offshore tech development potential in Vietnam. They soon discover the solution to all their technology needs in the Vietnam software outsourcing industry.
Software Outsourcing in Vietnam – On The Top Of The World
Vietnam software outsourcing has become one of the pioneers in the IT industry today. The country’s young population, high literacy rate, IT specialized schools, low development cost, political stability, and big tech investors, add up to make Vietnam the top choice for software outsourcing.
Destination of Several Tech Giants
Many big players in the tech industry have invested in Vietnam. A few such names are Intel, IBM, Fujitsu, Foxconn, Canon, and Saigon Technology are located in Ho Chi Minh and Dan Nang cities of Vietnam. This encourages more companies to invest in the country which helps in developing its infrastructure.
Software Outsourcing Pros and Cons
Software outsourcing helps both companies involved in the deal. It gives the hiring business access to cheaper and more diverse talent which consequently minimizes their expenditure.
It also creates more job opportunities in developing countries and benefits the hiring companies by increasing their profits.
The main disadvantages of software outsourcing, however, are the language barriers and the difference in time zones. Though the language barrier could be covered through education and training programs, the time zone difference requires adjustment according to the convenience of both parties.
Drawbacks of Hiring a Software Outsourcing Company in Vietnam
Drawbacks of outsourcing business operations are cultural dissimilarities, a decrease in company morale, and a fall in the quality of work. Cultural dissimilarities cannot be eradicated but can be dealt with while keeping both countries in consideration.
Another disadvantage to the hiring company is that local employees may view outsourcing as a threat to their positions. This could result in a decrease in their morale, affect productivity, and cause dissatisfaction.
However, this can be countered through clear communication from the leadership and assurances that their jobs are secure.
Lastly, some companies may hire employees of a lower skill set which can result in incompetent workers for the required tasks, which would effectively waste time, effort, and money. This is why it is important to keep a company’s requirements in mind and hire the best team for that.
How Many Software Developers Are There In Vietnam?
An IT market report of 2020 has declared that Vietnam provides more than a hundred software development companies and almost 400,000 IT engineers. The number is increasing making Vietnam a promising outsourcing choice for clients.
High Outsourcing Readiness
Vietnam’s software development market statistics show how reliable and promising it looks as an outsourcing country. The number of IT engineers is rapidly increasing, putting Vietnam as a topmost choice for many tech giants like Intel, Samsung, Microsoft, Fujitsu, Foxconn, Panasonic, Bosch, and Cisco, to name a few
Diverse Technical Skill Sets
Vietnamese engineers have a diverse set of technical skills. These include a range of Backend, Frontend, Full-stack, Database, Android developer, UI/UX designer, DevOps specialist, etc. With such a variety of skills on their side, the hiring companies stand to benefit significantly.
Agile & Scrum Dominance
Vietnamese IT companies are widely using two of the most effective project management applications, Agile and Scrum.
These provide transparency of information, a cost and timeline plan, increase team efficiency and the overall productivity of any project.
Moderate English Proficiency
As the Vietnamese are generally at a moderate level when it comes to English proficiency, you can follow some tips to overcome that barrier. Having a senior engineer or project manager as a team leader could help as high-level employees are commonly more fluent in English.
When you have a clear vision of your project, you can share that through email, design, and sketches, making communication and understanding better between both sides.
Culturally, Vietnamese are not direct in their communication style, though accepted in their society, this becomes slightly problematic especially when it comes to getting feedback.
You can deal with this by setting some basic guidelines on how to exchange information and communicate with mutual agreement from the start.
Which Country Is Best For Outsourcing?
The ten best countries for outsourcing outside of Vietnam are India, Ukraine, China, Poland, the Philippines, Romania, Brazil, Taiwan, Egypt, and Canada.
There are a few things you must consider when thinking of outsourcing to other countries. These include lower costs, higher quality of education, developed IT market, time zones, and communication in your preferred language, which is usually English.
Vietnamese are generally hardworking people, which applies to young engineers as well. However, they may overdo it and occasionally affect productivity by burning out. In such cases, it is better to clarify the requirements you set down for working hours and deadlines.
Vietnamese developers are great at technical skills but the same can’t be said for their soft skills. Different internal and external workshops can be conducted to teach developers how to speak in public, share experiences, communicate with colleagues or clients, and learn social cues to benefit their personal development.
Compensation and Benefits
In Vietnam, the net salary is negotiated, unlike other countries where they use gross salary. Culture has a big part to play in this, the Lunar New Year is a big occurrence in Vietnam, and for example, employees are expecting to receive a bonus in addition to their salary and any performance-based bonuses they may be due for.
Should I Outsource My Software Development?
Outsourcing is an option that many companies are beginning to prefer especially after the hit they took during the pandemic. Even though outsourcing is becoming one of the most common business norms, some important factors must be considered before you decide to go for it.
- If you wish to cut costs, outsourcing software development is a great option. An almost 70% decrease in development cost is possible through well-planned outsourcing as compared to working with an in-house team.
- You can get services from global professionals, opening a wide range for your business in terms of available expertise.
- Unlike an in-house team, the outsourcing company does not need a manager. They take care of all management duties automatically though you may have to guide them where needed.
- You can save time by outsourcing software development and benefit from the maintenance that goes with it. The saved time can be used in other areas like marketing and administrative tasks.
- You gain access to the latest technology as good outsourcing companies use the best technology with advanced frameworks and development tools. These experienced developers can even make useful recommendations for your business.
Outsourcing is a fast-growing industry and has proved to be beneficial for many organizations. Yet, it is necessary to do your homework before opting for it. You must be sure about your requirements and what you will demand from the outsourcing company. Finally, a thorough search and selection process could provide you with the best outsourcing options worldwide.
Vietnam may still have to work on some areas but it has greatly developed due to the strong work ethic and technical skills available. Vietnamese developers constantly strive to do better and are rapidly making Vietnam a top-tier choice for outsourcing software development.