Application development is at the forefront of many of today’s enterprises. While organizations large and small will continue to purchase standalone packages, they also have unique requirements requiring tailor-made solutions.
And that presents some unique challenges. Without in-house capabilities, getting someone else to do the job only makes sense, but programmers in the US are in short supply, with wage inflation a chronic concern. The work has to be done to meet business specifications, ideally in a cost-effective manner. Of course, it’s also critical that the work be completed by a capable, responsive team.
At first blush, outsourcing development is the obvious answer. However, finding the right software development house can be tricky. For companies that aren’t in the business of writing software, addressing the need for additional capabilities is, at times, uncharted water.
What many organizations don’t realize is that the answer is, quite literally, right next door, in the city of Tijuana, Mexico. Tijuana is the fourth largest city in Mexico, and shares the world’s largest land-based border crossing with California. Populations on both sides of the border do business with each other on a daily basis.
Tijuana has an untapped developer resource that, historically, has been overshadowed somewhat by the city’s BPO industry, which boasts a workforce of about 13,000. But that’s changing, with US-based customers noting that many of Tijuana’s developers have been educated in the US, and have years of programming experience. These are professionals who possess English-language and technical skills that can match those in pricier US markets.
“The US is getting more expensive every day, which makes Tijuana a really good option,” says Daniel Rangel, SVP, Administration & Client Services, for GGA Solutions, which has two locations in Tijuana’s financial and business district, the Zona Río. “On average, our software and services clients are saving from 35% to 38% on what they’d be paying north of the border.”
Those are compelling numbers, which are helped along by the fact that GGA’s operations are close at hand. Not only is there no need for US clients to adjust to time zones, it’s also an easy day-trip to have face-to-face meetings with developers.
“We launched our software team last year, and have already landed three customers,” says Rangel. “Two are insurance companies, and the other is a California-based custom software development company.”
Having a nearshore provider like GGA close at hand helps provide peace of mind for clients who need to ensure that quality code is being written in accordance with strict business rules.
“We integrate seamlessly into US-based tech teams and extend their capabilities, and are a good option for those companies that want to gain traction by developing their own code, or by enhancing their current applications,” says Rangel. “A project can involve us working with a client’s in-house team, or doing it entirely on our own. We function solely in a dedicated environment and build bilingual, professional teams, which are able to partner with in-house tech teams throughout each phase of the software development and support cycles.”
The GGA story represents a transition of sorts for Tijuana, which has already build a solid reputation in the BPO space, and where nearshore development companies have tended to be smaller operations emphasizing front-end development. Now, nearshore developers in Tijuana are moving up the value chain, with more back office work being done for larger customers.
“Many companies rely on freelance developers in the US, and depending on the technology and the framework, that can get pretty expensive,” says Rangel. “You can hire people in the US, but retention can be a problem, as people will sometimes jump ship to work with a tech giant.”
All of this is happening in a city that’s poised for growth. Adriana Eguia Alaniz, former CEO of the Tijuana Economic Development Corporation, and former Executive Director of the Cali Baja Bi-National Mega-Region, told Nearshore Americas earlier this year that Tijuana’s tech scene is “a growing sector with a lot of potential for success.”
Part of the tech growth has come from the need to support global companies resident in Tijuana, which include big players like Bose, Foxconn, Panasonic, Plantronics, and Samsung. A big part of that is building capabilities in demanding areas like robotics and AI, which require top-notch programming skills. This is being abetted by growth in incubators, and by Tijuana’s close proximity to San Diego, which makes the Mexican city a truly bi-cultural place with a strong entrepreneurial spirit.
“What we’re witnessing in Tijuana is that more companies are seeing it as a tech hub,” says Rangel. “And we’re right next door, which means we can provide US quality with nearshore pricing.”