Insight 3: How regional outsourcing can build the teams to meet local demand

Outsourcing within sub-Saharan Africa, instead of outside of it, could accelerate the development of regional talent and meet the needs of organizations across industries

The digital age has led to enormous opportunities across the world and sub-Saharan Africa, but also significant challenges. This is the fourth installment of a new DIAL insights series that explores some of these cross-cutting issues and offers practical recommendations for expanding the cadre of software developers across sub-Saharan Africa.

Read the full series here

As the technology needs of organizations across sub-Saharan Africa continue to grow, the hunt for experienced software developers who can build and customize software grows alongside it. When employers lack the staff to meet those software needs—as 73% of employers in our research indicated they do —they must decide how to get the work done.

“We need to fill senior roles but can’t find qualified personnel in Kenya, so we exclusively fill these positions in India, as they have a richer source of talent.”                                                                                               

-Employer, East Africa

The popularity of global outsourcing for software development support (or hiring contractors from outside sub-Saharan Africa to meet an organization’s technology needs) remains a major obstacle to building the ranks of senior software developers across the region. Contracting with an experienced outsourcing firm in a country like India or Ukraine can be cheaper and more efficient than hiring locally. In fact, our research found that many companies, such as Jumia, m-Kopa and Software Group, have recently moved all software development out of sub-Saharan Africa.

Unfortunately, this means moving opportunities out of reach for local engineers, who lose out on the chance to work on complex, meaningful projects that could help them grow and advance.

An opportunity to foster local talent

Within countries in sub-Saharan Africa, small local software outsourcing firms provide a model for larger, more sustainable solutions to the scarcity of senior engineers and the wide range of tech needs within organizations. By pooling talent and creating the infrastructure to support contract work, they can create efficiencies that make prices for clients more competitive, while at the same time shoring up local talent and building the ranks of senior engineers.

While these outsourcing projects are often short term, they give mid-level engineers experience with complex problem-solving that is so prized but lacking in the current market.

Because of a lack of funding and the current trend towards global outsourcing, these firms remain relatively small and rare – the majority in Kenya and Nigeria. Most existing firms outsource within the country where they are based, as well as to other neighboring countries in sub-Saharan Africa.

Challenges and opportunities for the development sector in supporting African technology talent

1.The development sector’s reliance on global outsourcing

The development sector in sub-Saharan Africa, including donors and NGOs, has many incentives for utilizing local organizations to meet their tech needs. Developers from the region speak local languages, understand norms, and return their incomes to local economies.

Yet many NGOs and donor agencies working in sub-Saharan Africa still use global outsourcing to support their programs. Increasingly, social good projects require the expertise of software developers who can build applications and software that support technology-dependent initiatives. These might include apps for collecting health data from mobile phones or measurement and evaluation software. 

Development-sector organizations outsource globally for a wide range of reasons. For taxpayer-funded government donor agencies, such as USAID and DFID, using public money dictates stringent spending guidelines, which are passed along to the donors’ grantees and subcontractors. Often, those requirements are so rigorous that they preclude smaller firms from qualifying, since they tend to lack the capacity to deal with hefty application, administrative and reporting requirements. Driven by these constraints, along with the scarcity and expense of local senior developers, development agencies in the West often look to pre-approved firms in their own countries.

2. Misconceptions about the existence of local software development talent

Some in the development community mistakenly believe that there is no software development talent in sub-Saharan Africa. In fact, junior engineers are being trained every year and looking for jobs, and there is a wide population of entrepreneurial, mid-level developers who have taken the initiative to gain skills on their own.

Without structure and opportunity, this local talent remains largely anonymous and invisible to organizations looking for software development support. Those spending development money in sub-Saharan African could make a huge impact by meeting their own technology needs with local talent.

Recommendations

While there is no one-size-fits-all solution to the challenge of building the ranks of senior engineers in sub-Saharan Africa, local and regional outsourcing provides one possible avenue that has succeeded on a smaller scale. Local outsourcing could allow for the development of the local industry, create senior developers, and address outsourcing and vacancy challenges facing companies.

For skills development programs 

  • Develop relationships with local outsourcing organizations to offer a new source of workplace learning opportunities and potential job placements for trainees.

For employers

  • When local hiring is not feasible, consider calling upon local outsourcing organizations instead of international firms.

For donors and policymakers

  • Source technology needs locally. Consider outsourcing from within sub-Saharan Africa when local hiring is not feasible.
  • Prioritize working with local firms to meet software development needs, even if incurring slightly greater costs.
  • Consider amending spending policies for grantees and subcontractors in a way that opens the door to hiring local sub-Saharan African outsourcing firms.
  • Invest in nascent or growing businesses that provide local software development talent to meet local needs.
  • Tailor training to include the specific soft and technical skills required, such as user-centered design and building for low bandwidth, which could help address organizational needs while also developing a pipeline of interesting, complex projects.