An End-to-End Overview of Latin American Software Outsourcing

Outsourcing to Latin America has its unique advantages over other regions, which makes the region an attractive location for companies to outsource their software development requirements. One of the primary benefits of outsourcing to Latin America is cost savings. The region also boasts a talent pool of skilled software developers who can create exceptional software solutions. The lower cost of living in Latin America also makes it a preferable option for outsourcing software development.

The size of the outsourcing team for Latin America depends on the scope of the project, with larger companies requiring teams consisting of hundreds of software developers while smaller businesses can function with a smaller team of around 10-20 developers. Cultural similarity with the United States is another advantage of outsourcing to Latin America as it paves the way to build better relationships, while outsourcing helps companies enjoy cost savings. Lastly, Latin American software developers are known for their ability to produce high-quality software solutions.

While approaching the Latin American software outsourcing market, companies should observe the different cultural, legal, and economic factors inherent in the region. Companies should be aware of the varied software development services that are available in Latin America; moreover, they should consider the cost savings feasible by outsourcing to the area. Seeking expert consultation with local professionals can help ensure that the software outsourcing process is in line with the region’s regulations and best practices.

Are you seeking answers to such questions? Keep reading!

From independent entrepreneurs to larger corporations, all technology organizations aspire to retain the most skilled engineers while keeping costs low. However, due to the talent shortage in the USA, it has become progressively difficult to assemble the most talented workforce in the domestic market. Thus, quite a few US businesses are relocating their operations to Latin America, viewing it to be more advantageous.

Latin America offers a compelling alternative for outsourcing software development due to its minimal time difference with the United States, capacity to tailor local labour regulations to meet business requirements, close proximity, and absence of language barriers. Furthermore, many countries in the region have invested considerably in their IT infrastructure, making them well-equipped for this purpose. Therefore, it is worthwhile to explore the potential opportunities available through this option.

Why select Latin America for outsourcing over other regions?

1. Lesser time zone differences

   Working remotely in Latin American countries is more convenient when compared to other regions in Asia and Europe.
   
   Latin American countries such as Argentina, Costa Rica, Brazil, Colombia, and Mexico have a time difference of only one to three hours with the United States, which is significantly shorter than the time difference of five to ten hours with more distantly located countries such as India, China, Vietnam, Indonesia, Ukraine, and others.

2. Quick adaptability to changing regulations and needs

   In Latin America, customers prefer service providers fluent in English, close to them, and financially reasonable.
   
   By analyzing India and Poland, both countries have become prominent players in the outsourcing and shared services industry; it is evident that India has a higher rate of wage inflation than Poland, which is associated with a more constant economic environment.

3. Proximity to contracted teams

   If you opt to hire from Latin America, you gain a considerable advantage. You can travel efficiently and quickly by air, enabling direct involvement with the development process without taking a detour.
   
   Software development outsourcing to countries close to the United States can optimize the process of developing, onboarding, and sustaining software projects. The time difference between the United States and Mexico, for instance, is negligible, making coordination between the two countries effortless. This proximity fosters enhanced engagement between both parties, contributing to software project success.

4. Global aid and facility expansion

   Recent studies have shown a growth in the number of top technology companies launching operations in Latin America. This upswing is due to the region’s considerable talent pool and will contribute to the continuous growth and advancement of the technology sector.
   
   Industry giants such as Intel, GM, Genpact, Wipro, American Express, and Citibank have established a presence in the Latin American outsourcing market. These major corporations are heavily investing in state-of-the-art office and factory facilities in addition to new call centres, offshore delivery centres, Shared Service Centres (SSC), and Business Process Outsourcing (BPO) services. This substantial investment demonstrates their determination to remain competitive in today’s marketplace.

What distinguishes Latin American societies from others?

Successfully recruiting and retaining technical talent in Latin America necessitates adapting recruitment approaches to the local culture. To accomplish this effectively, comprehending the cultural traits of the region is crucial. This article examines the most significant cultural characteristics of Latin American nations. Recruiting and retaining technical talent in this region should take into consideration these cultural aspects.

1. Higher education institutes in the region

   If seeking to hire novice developers directly from academic institutions, having knowledge of top educational institutions in the related field is crucial. QS University Rankings has published a list of top technical schools in Latin America, which should be taken into consideration. The following list comprises the ranked universities:
   
   1. National Autonomous University of Mexico
   2. São Paulo State University
   3. State University of Campinas
   4. National University of Chile
   5. Pontifical Catholic University of Chile
   6. National University of Technology and Agriculture, or U.T.N.A.L.
   7. National Institute of Technology
   8. National University of Colombia

2. Diversity in Engineering Experience

   Due to differing options for training and job opportunities in each location, an engineer in Latin America may follow a career path that differs widely from an engineer in the United States.
   
   With the advent of convenient online courses and more accessible higher education, Latin American countries now have abundant talent available to them. Graduates of traditional universities, coding boot camps, and other specialized programming schools all contribute to the available talent pool. Companies may then choose to employ talent full-time or use specialists as contractors. As a result, Latin American countries are well-positioned to fulfill the needs of the tech sector and gain from the correlated economic expansion.

3. Differences in Application Formats

   Be thorough when evaluating resumes while interviewing Latin American candidates.
   
   Latin American candidates often portray themselves modestly on their resumes due to their preference for a collaborative work culture over an individualistic approach. Therefore, their resumes may not highlight individual accomplishments effectively.
   
   In certain countries, CV means “resume” (Curriculum Vitae). It is also essential to note that a developer in Latin America may include a photo and a significant amount of personal information on their resume. Generally, resumes in Latin America are more comprehensive than the standard one-page resume common in the United States.

Top South American Destinations for Software Outsourcing

1. Argentina

   Argentina has a significant advantage in the software development industry because a majority of its software engineers are proficient in English.
   
   The Argentinian population ranks highest in South America on the EF Education First global exam on average.
   
   The government is aware of the significance of Information Technology (IT) outsourcing and continuously revises labour laws to align with industry activities. Additionally, the government is actively taking measures to attract foreign investors.
   

   1. Capital:

      Buenos Aires, the capital of Argentina

   2. Language:

      The official language is Spanish

   3. Famous for:

      Tango, steak, wine, and football

2. Bolivia

   Bolivia is advantageous for offshore operations due to its cultural similarities with the United States. This similarity eliminates the need for companies to spend considerable effort acclimatizing to the culture of the outsourced workforce, enabling them to leverage their skill sets with minimal delay.
   
   Compared to other LATAM nations, Bolivia’s economy is more efficient, enabling it to attract top talents.
   
   In recent years, Bolivia has shown remarkable growth in its technology industry, positioning itself as a significant centre of innovation in South America. This progress has boosted the country’s economy and has had a positive impact on its citizens.
   

   1. Capital:

      Sucre is the capital of Bolivia

   2. Language:

      Spanish is the most commonly spoken among the 37 official languages.

   3. Famous for:

      Pans of melted salt

3. Brazil

   Brazil has the largest economy in South America, making it a significant hub for IT service outsourcing. It is also home to numerous Fortune 500 companies, such as IBM and HP, which have their headquarters in Brazil. The country’s economic and technological capabilities make it an ideal destination for businesses to operate and access a vast, skilled labour pool.
   
   Brazil’s vast IT workforce, consisting of more than 500,000 experts, as well as an annual influx of 23,000 graduates, makes it a perfect spot to source software engineers.
   
   Compared to Argentina, Brazil is a more preferable software outsourcing location, primarily due to its technical expertise and a proficient command of the English language. The country has established itself as a software development leader, with a highly qualified workforce and excellent English-language skills. These aspects make Brazil the perfect destination for companies seeking to outsource software development.
   

   1. Capital:

      The capital of Brazil is Brasilia

   2. Language:

      Portuguese is the official language

   3. Famous for:

      Producing legendary football players, hosting a vibrant carnival, and encompassing the Amazonian jungle

4. Chile

   Thanks to its booming economy and pro-business climate, Chile has emerged as one of South America’s top software outsourcing destinations.
   
   Over the years, multinational firms have taken a keen interest in Chile, largely due to the country’s strong reputation and growing economy. Chilean software developers have made significant contributions to multiple sectors, including security systems, mobile banking, data processing, web design, and green technology. As a result, Chile has become a major hub for technological innovation and economic progress.
   
   The country is equally famous for its advanced telecommunications infrastructure, with some of the highest mobile phone and internet penetration rates in the region. This cutting-edge technology spectrum has facilitated the expansion of various services, from traditional communication means to the latest applications, enabling people to stay connected and informed. As a result, Chilean citizens enjoy a high-quality telecommunications experience that is not only reliable but also efficient and affordable.
   

   1. Capital:

      The capital of Chile is Santiago

   2. Language:

      Spanish is the official language

   3. Famous for:

      Renowned poets, exquisite wines, and Easter Island

5. Peru

   After Brazil and Argentina, Peru is the third-largest country in Latin America regarding land area.
   
   Peruvians possess a vast amount of knowledge and experience in computer programming. Several Peruvian programmers have prior experience working with or researching the techniques used by significant corporations.
   
   Peru is regarded as one of the top outsourcing destinations in LATAM as its workforce culture aligns well with that of the West.
   

   1. Capital:

      The capital of Peru is Lima

   2. Language:

      The official languages of Peru are Spanish, Aymara, and Quechua

   3. Famous for:

      Cuzco, Machu Picchu, and its adorable Alpacas

6. Uruguay

   Uruguay is highly regarded for its advanced and progressive educational system, which provides students with top-notch education. The country has also displayed a willingness to adopt and embrace emerging technologies, enabling the education system to leverage cutting-edge tools to ensure students have the best learning experiences. It is this combination of innovative education and openness to new technologies that truly sets Uruguay apart from other nations.
   
   Thanks to the progressive education system in Uruguay, students have the opportunity to gain valuable professional experience while still in school. Additionally, Uruguay is a leader in introducing children to technology at a young age and equipping them with the necessary skills to succeed in the digital era.
   
   Companies like IBM, Kraft, BBVA, and HBO have expressed interest in Uruguay by establishing offices and forming partnerships there.
   

   1. Capital:

      The capital of Uruguay is Montevideo

   2. Language:

      Spanish is the official language of Uruguay

   3. Famous for:

      Punta Ballena, the enchanting tango, exceptional wines, and the traditional drink mate

Five easy tips for hiring skilled software engineers from Latin America

1. Choose the right country

   Searching for a software engineer in any of the thirty-three countries in Latin America can be a daunting task. Therefore, it is advisable to identify the country that is best suited to your needs.
   
   When selecting a country, research those that are known for certain qualities. For instance, Panama is recognised for its state-of-the-art software technology, while Chile boasts highly-regarded software developers. Examining your options can help you choose the country that can provide the best fit for your requirements.
   
   Narrow your search down to one or two countries. Doing so will make it easier to find the perfect candidate quickly.

2. Evaluate the talent pool in each country

   It is crucial to recognise that, despite having a vast software engineering industry, Latin American experts may specialise in a diverse range of disciplines.
   
   In Latin America, there is a significant number of mobile developers, data administrators, data analysts, business analysts, and quality assurance specialists, but most of them focus on back-end development.
   
   If you are seeking professionals skilled in back-end software development, then Argentina, Chile, Mexico, Colombia, and Uruguay are promising options. On the other hand, Brazil is a viable choice for individuals searching for gaming, visual, and DevOps professionals.

3. Consider the cost factor

   It is important to note that software engineers in Chile, Argentina, and Brazil command high salaries (above $10,000 per year), according to StackOverflow. Therefore, if you are working on a small project with budget constraints, it might be best to look at other countries.
   
   Instead of solely focusing on cost, search for a software development expert who can fulfil your requirements within your budget.

4. Evaluate their technological proficiency

   A recent survey conducted by Stack Overflow discovered that Latin American developers have a clear inclination towards certain programming languages, with HTML, Java, and Python being the most popular amongst them. Additionally, the survey highlights that these developers tend to harbour a strong dislike for certain technologies.
   
   In order to determine their technology expertise, programming language proficiency, and other relevant abilities, it is advisable to conduct both online and in-person examinations and assessments. This method will enable us to evaluate their understanding and problem-solving skills.

5. Seek their input by asking about their prior experiences.

   It is crucial to assess their level of expertise. Inquire about their involvement in similar projects, their responsibilities and role, and their approach to achieving impressive results.
   
   If you decide to hire a software developer with less experience, they should still be capable of providing you with a plan outlining the steps they will take to complete your project.

In conclusion, the bottom line is

Offshoring to Latin American countries can offer a plethora of benefits to businesses. It is essential to note that the advantages of offshoring to Latin America are not solely limited to cost reduction. This approach can also lead to a substantial surge in efficiency and the possibility of creating robust and enduring partnerships.

If you are searching for a convenient and hassle-free way to recruit expert programmers in Latin America, head over to Works. We can eliminate the administrative burdens associated with sourcing the right talent.

At Works, we employ the potential of Artificial Intelligence (AI) through our Intelligent Talent Cloud to aid businesses in sourcing, evaluating, training, and managing an exceptional global pool of software developers. This comprehensive solution offers a comprehensive range of tools that help companies manage their entire recruitment process from beginning to end. The Intelligent Talent Cloud uses AI-powered analytics to provide businesses with a faster, more cost-effective method of identifying, hiring, and managing the most skilled software developers available.

FAQs

1. What makes Latin America a viable option for outsourcing over other regions?

   Companies can employ remarkably skilled information technology (IT) professionals from Latin American countries at a fraction of the cost of hiring within the United States. Moreover, technology hubs in cities like Buenos Aires, Uruguay, and Bogota, Colombia, are rapidly evolving and expanding,

2. How many programmers would be a part of the Latin American software development team?

   As of 2021, the outsourcing market in Brazil, Chile, Argentina, Colombia, and Mexico has approximately 963,000 programmers at their disposal.

3. What motivates a US company to hire offshore workers from Latin America?

   Here are four reasons why US businesses may choose to recruit workers from Latin America:
1. Less disparity in time zones
2. Capacity to rapidly adapt to new regulations and demands
3. Proximity to the outsourced teams
4. Access to global resources and promotion of novel infrastructure