How to choose the right partner for nearshore software development

The shortage of skilled IT personnel in the Netherlands is driving more and more organizations to partially outsource their software development. Nearshoring – outsourcing development work to teams in nearby countries – offers an attractive alternative to both offshoring and onshoring. With benefits like direct communication, cultural alignment, and cost-efficiency, this form of outsourcing is rapidly gaining popularity. But how do you find the right external development partner who not only excels technically but also contributes strategically to your success?

Nearshoring is growing in popularity as it enables organizations to access high-quality IT expertise without the downsides of traditional offshoring. By collaborating with development teams in nearby European countries, organizations benefit from minimal time differences, similar work cultures, and professionals with excellent English language skills. At the same time, compared to onshoring, nearshoring is also a cost-effective solution that makes working with smaller budgets feasible.

These advantages make nearshoring an attractive option, but to truly achieve success, choosing the right partner is essential. A poor choice can lead to project delays, quality issues, and ultimately higher costs. Selecting the right nearshoring partner is a strategic investment in your organization’s future. By comparing nearshoring providers based on the criteria below, you increase your chances of a successful collaboration with an external software developer.

Technical expertise and domain knowledge

The first and most obvious question is: does the potential development partner possess the right technical expertise? The technical capabilities of your development partner form the foundation of any successful project. A good nearshore partner has in-depth knowledge of relevant programming languages, frameworks, and modern development technologies such as microservices, cloud-native architectures, and DevOps practices.

A reliable development partner should have sufficient knowledge and experience with the following technologies:

• Modern technology stacks: Java, .NET, Python, React, Angular, Node.js, and cloud platforms like AWS, Azure, and Google Cloud
• Enterprise solutions: ERP integrations, CRM systems, and large-scale application development
• Architectures: Microservices, API-first design, event-driven architectures, and scalable system design
• Emerging technologies: AI/ML implementations, IoT solutions, blockchain applications, and automation technologies

In addition to technical knowledge, domain expertise is also a crucial factor. A partner with experience in your industry understands the specific challenges, regulations, and compliance requirements. Deep domain knowledge leads to better solutions and helps prevent costly misunderstandings during development.

2. Collaboration models and communication capabilities

Different projects require different approaches. A flexible partner offers multiple collaboration models:

• Dedicated team: a team from the development partner fully focused on your project
• Blended team: a mixed team consisting of specialists from both the development partner and the client
• Project-based development: for well-defined projects with clear requirements and deadlines
• Hybrid models: combinations of collaboration models tailored to fit your organizational structure

Effective communication is the backbone of successful nearshoring. It’s not only the language proficiency (minimum C1-level English) of the development team’s specialists that matters, but also the communication tools and working methods used. Key components include regular stand-ups, transparent reporting through tools like Jira and Confluence, direct access to team members via Slack or Microsoft Teams, and structured sprint reviews. The development partner should also proactively identify risks and suggest improvements.

3. Track record and references

Past performance is the best predictor of future results. That’s why you should ask potential partners for concrete case studies with measurable outcomes: cost savings, time-to-market speed, and performance metrics. Consult current and former clients about their experiences regarding project outcomes, whether deadlines were met, and the quality of support after the application was delivered.

Key factors to consider when evaluating a partner’s track record and references include:

• Long-term client relationships: partners with long-standing client collaborations demonstrate reliability
• Complex projects: experience with enterprise architectures, legacy modernization, and multi-year transformation initiatives
• Industry expertise: portfolios featuring similar organizations and challenges within your sector
• Scalable successes: from MVPs to full-scale production deployments

Focus on projects that closely resemble your own in terms of scale, complexity, and industry. A partner with a strong track record in your business domain understands the specific challenges and can implement proven solutions.

4. Cultural alignment

When working with an external development partner, cultural differences also come into play. While nearshoring typically involves minimal cultural gaps, it’s still important to consider differences in communication styles, decision-making, and project approaches. A strong cultural fit with the partner ensures smoother collaboration and reduces the risk of misunderstandings.

The following factors are key when assessing cultural alignment:

• Agile mindset: experience with Scrum, Kanban, and iterative development
• Proactivity: the ability to anticipate problems and propose solutions
• Transparency: openness about challenges, risks, and realistic planning
• Flexibility: adaptability to changing requirements and priorities

During introductory meetings, evaluate whether there’s a strong connection between your team and the nearshore partner. Organize workshops or pilot projects to test the collaboration in practice before entering into any long-term commitments.

5. Organizational stability and scalability

The organizational stability of a nearshore partner forms the foundation for long-term, successful collaboration. A stable organization ensures continuity during project execution and helps avoid disruptions caused by internal turbulence. When assessing stability, the financial health of the company – including revenue growth, profitability, and liquidity – also plays a crucial role. A partner with a solid financial foundation can invest in talent, technology, and process improvements, all of which directly benefit the quality of your projects.

Nearshore partners with over ten years of experience have weathered multiple market cycles, proving their resilience. An annual employee turnover rate below 5% indicates a healthy work culture and satisfied employees. This translates directly into project continuity: developers who stay longer with the company gain deeper knowledge of your systems and work more efficiently. Be sure to ask for concrete data on employee retention and the average tenure of senior developers.

Scalability determines whether a partner can grow alongside your ambitions. A development partner with sufficient IT specialists can scale while maintaining knowledge and continuity within the team. This requires robust HR processes for recruitment, onboarding, and skill development. Investigate whether the partner has proven experience in scaling teams, for example, from 5 to 25 developers within a few months. A reliable partner should also be able to scale down when project phases require it, without compromising collaboration or team dynamics.

6. Team quality and HR policy

The quality of the team working on your project directly determines the success of the software development. A strong nearshore partner not only excels at attracting top talent but also continuously invests in the growth and development of its employees. This includes a robust recruitment process, a culture of lifelong learning, and an effective retention strategy.

Recruitment and selection: the foundation of quality

A leading nearshore partner has access to an extensive talent pool of IT specialists. This means they don’t need to search for suitable candidates on an ad hoc basis when a new project begins. Instead, they can draw from an existing group of qualified professionals. This is crucial, as it enables the partner to quickly and efficiently assemble a team that aligns perfectly with the specific requirements of your project.

Continuous development and knowledge retention

Technology never stands still. That’s why it’s essential that the nearshore partner continuously invests in the professional development of their IT specialists. This includes:

• Training and certifications: Encourage team members to pursue relevant courses, training programs, and certifications in new technologies, frameworks, and best practices (e.g., cloud platforms, cybersecurity, or specific programming languages). Ask about the allocated budget and the frequency of these trainings.
• Knowledge sharing and mentorship: A culture that promotes active knowledge sharing among colleagues — through internal workshops, code reviews, and mentorship programs — strengthens the team’s collective expertise.
• Innovation and experimentation: Encourage developers to experiment with new technologies and concepts beyond their daily project tasks. This fosters innovation and keeps the team sharp.

HR policy and retention

ow employee turnover is a clear indicator of a healthy and stable company. High turnover leads to knowledge loss, project disruptions, and the need to onboard new team members – a costly and time-consuming process. An effective retention strategy includes:

• Competitive compensation and benefits: Offering an attractive salary package and strong secondary employment conditions
• Career development: Providing clear growth paths and opportunities for advancement within the organization
• Positive work culture: Creating a stimulating, respectful, and enjoyable work environment where employees feel valued and can thrive
• Engagement: Regularly measuring employee satisfaction and actively responding to their feedback

Teams-as-a-Service (TaaS): Focus on Output 

The modern Teams-as-a-Service (TaaS) approach shifts the focus from delivering individual hours to providing a complete, autonomous, and output-driven team. In the TaaS model, the nearshore partner assembles a multidisciplinary team responsible for the entire development process – from concept to delivery – with an emphasis on achieving tangible results and business objectives.

Key aspects of TaaS:

• End-to-End Responsibility: The team is accountable for the full software lifecycle, including analysis, design, development, testing, deployment, and sometimes even maintenance.
• Output-focused: Instead of billing by the hour, the focus is on actual output, such as working features, prototypes, or complete applications that meet defined requirements. This encourages efficiency and results-oriented thinking.
• Collaboration and synergy: The partner builds a team in which individual members complement and reinforce each other based on their specific expertise, personalities, and experience. This leads to higher productivity and better software quality.
• Proactive mindset: A TaaS team actively thinks along with your organization, identifies opportunities and risks, and proposes improvements rather than merely following instructions. This makes the team a strategic partner, not just an execution unit.

By carefully evaluating a nearshore partner’s recruitment practices, investment in knowledge development, and HR policies – and specifically assessing their TaaS approach – you increase your chances of securing a high-quality and successful development team that demonstrably contributes to your business goals.eid van een nearshore partner, en specifiek te letten op een TaaS-benadering, vergroot je de kans op een hoogwaardig en succesvol ontwikkelteam dat aantoonbaar bijdraagt aan jouw bedrijfsdoelen. 

7. Reliability and reputation

Reliability and reputation are fundamental qualities that take years to build and form the foundation for successful collaborations. Testimonials from current and former clients provide insights into a potential partner’s performance, customer service, and ability to deliver on promises. A strong reputation is built through consistent results, transparent communication, and reliably honoring commitments.

Reliability is demonstrated through daily interactions and operational excellence. A dependable partner communicates proactively about project progress, potential risks, and changes to timelines. They adhere to agreed deadlines and budgets, and if that’s not feasible, they provide early warnings and realistic alternatives. A trustworthy business partner is also willing to acknowledge potential shortcomings and accept responsibility for risks. This is reflected in their readiness to agree on SLAs (Service Level Agreements) with concrete penalties for failure to meet expectations.

You can objectively assess a partner’s market reputation through measurable performance indicators. Look at industry awards, ISO certifications, partnerships with major technology providers (such as Microsoft Gold Partner or AWS Advanced Consulting Partner), and participation in prestigious projects. A partner with a strong reputation is often selected for complex transformation initiatives by large enterprises, a clear sign of trust from the market.

8. Costs and contractual terms

While cost savings are an important driver for nearshoring, this aspect should not be the sole criterion. Evaluate the total value proposition: what does your organization receive in return for the investment? A slightly more expensive partner who delivers better quality and service may ultimately prove more cost-effective, something worth keeping in mind.

Ensure transparent contractual agreements on pricing structure, deliverables, intellectual property, and liability. Flexibility in contract terms is valuable for long-term collaborations. The best partnerships go beyond formal agreements. They are built on mutual trust, shared goals, knowledge exchange, and continuous improvement.

The actual cost can only be effectively calculated once the output is fully delivered. When an application is complete and functioning according to the original briefing, you can list all costs and determine how many hours were spent on the project. Some clients tend to focus solely on the hourly rate of an external developer. Choosing a developer with a low hourly rate is not always the wisest decision. The key question is how many hours will ultimately be required to complete the project. Sometimes it’s better to choose a developer with a higher rate, as their knowledge and experience allow them to complete the work more efficiently. A developer with a lower hourly rate may end up costing more if a lack of expertise extends the overall delivery time.

9. Innovation capacity and future readiness

Technology evolves rapidly, and your partner must keep pace with these developments. Assess the partner’s innovation capacity by examining their investments in new technologies, R&D activities, and thought leadership in the market. A future-ready partner helps your organization stay prepared for technological changes and seize new opportunities.

Artificial intelligence (AI) is already being applied in many ways to make software applications smarter, faster, and more user-friendly. For example, AI chatbots and virtual assistants are used to automatically and personally handle customer queries, making customer service more efficient. AI is also applied in image and object recognition, such as automatically tagging photos on social media or recognizing products. Additionally, AI helps prevent fraud by detecting suspicious transaction patterns, and it can automatically generate content like product descriptions or reports. AI models are also used for predictive analytics, such as estimating customer behavior or forecasting maintenance needs for industrial equipment. A nearshore development partner should be capable of integrating these new AI technologies into software applications.

At the same time, AI can also be used within the software development process to make it faster, more efficient, and higher in quality. AI tools automate repetitive tasks like testing and bug detection, allowing developers to focus on more complex challenges. AI can identify bugs in code before they reach production and even suggest improvements. AI-driven tools also support project management, predict lead times, and optimize resource allocation. As a result, software is delivered faster, with fewer errors and at lower cost; while developers experience greater job satisfaction and increased productivity. Here too: a nearshore partner that integrates AI into the development process is better equipped to deliver complex software projects more quickly.

10. Infrastructure and security governance

Modern software development requires a robust technological infrastructure that guarantees scalability, security, and continuity. A professional nearshore partner operates with enterprise-grade development environments, including automated CI/CD pipelines, distributed version control systems, and integrated testing frameworks.

Security governance is a critical success factor, especially when developing applications that handle sensitive business data and/or personal information. A reliable partner applies security-by-design principles, integrating security into the development process from the outset. Evaluate certifications and compliance with standards such as ISO 27001 and ISO 9001.

GDPR compliance is essential for European organizations and requires specific technical and organizational measures. A suitable nearshore partner implements privacy-by-design, maintains clear data processing agreements, and can demonstrate how personal data is protected throughout the entire development lifecycle. They should be transparent about data location, access controls, and deletion procedures. In addition, the partner must regularly organize security awareness training for their development teams and stay current with emerging threats and best practices. A mature security governance framework also includes regular penetration testing, code security reviews, and compliance monitoring to ensure continuous improvement.

Want to know more about successful nearshoring?

Don’t have the time or desire to compare providers yourself? Choose NetRom Software, a partner that scores highly on all ten criteria outlined in this article. NetRom Software combines over two decades of experience with the innovative power of more than 500 IT specialists in Romania. Our proven track record, deep domain knowledge, and broad technical expertise make us the ideal nearshore partner for your digital ambitions. We believe in the Teams-as-a-Service (TaaS) model, where the focus is on measurable output.

Curious how NetRom Software can help your organization grow? Contact us for a no-obligation consultation. Together, we’ll deliver digital solutions that truly make a difference for your organization.