Last month, Prime Minister Jacinda Arden announced the Government’s highly anticipated plan to open our borders amid New Zealand’s dire labour shortage crisis.

While this provided a small glimmer of hope for our future labour force, the Delta outbreak means the door remains firmly shut for now. Our straining?healthcare system is a clear illustration of the problem facing the country.

While ramifications from the pandemic have certainly heightened current resource scarcity, the perception that these inadequacies are a new problem is not justified.

Our country has always been heavily reliant on talented skilled migrants who have filled gaps in many sectors including healthcare, tech and horticulture, and this dependence is putting our economy at risk.

According to NZ Tech’s Digital Skills Aotearoa Survey, released?this year, our country requires almost 5,000 digital technology professionals every year to meet the growing demands of the market. By the end of 2019, there were 114,450 individuals employed in the tech sector, around five percent of New Zealand’s workforce.

More than half of the tech roles has previously been filled by migrants, and the number of tech related occupations detailed on Immigration New Zealand’s long-term skill shortage list has remained constant. A few years ago, 3,683 individuals migrated here to assume technology roles, a figure which crashed to a mere handful when Covid-19 hit.

Our nation is small and remote; we’re constrained by our lack of experienced senior IT workers and are instead faced with an oversupply of under-skilled graduates. Aotearoa has always struggled to meet labour demand, and when the borders finally open, these human capital shortages are likely to intensify, as we lose our talent overseas.

Innovation and development are key to maintaining and growing any sort of successful enterprise. Behind every successful company are the people building the software that makes them thrive. To paraphrase Microsoft CEO Satya Nadella, with almost ※every company becoming a software company,§ it’s blatantly apparent that the law of supply and demand comes into action.

One solution to the problem is to improve our domestic talent pipeline by developing local talent and re-skilling people in the workforce. While this will boost our future labour supply, it’s a medium to long-term investment, and will never be the entire answer.

The Digital Skills Aotearoa Survey found?the number of students enrolling in IT degrees has remained stagnant with only 1,850 students enrolling in an IT degree in 2019, compared with?1,500 students enrolled in law at Auckland University in 2017. Sadly, the reality is many New Zealanders simply aren’t interested in pursuing a career in IT.

For New Zealand companies, the realistic solution is to collaborate with offshore talent, which can provide them with timely, high-quality, and accessible software development.

There’s no doubt a stigma attached to outsourcing, which has stemmed from the failures of a few well-publicised New Zealand companies who attempted to implement offshoring practices but ultimately weren’t successful. Outsourcing failed for these businesses, not because the model didn’t work, but because these companies didn’t tailor their offshore resource to our local market. They may have moved entire departments offshore, but in overseas markets there are invariably communication challenges, time-zone issues, and in some cases, even political complications.

In our Vietnam office, from day one we were very clear that our team would be working in a New Zealand office, based in Vietnam. We sent an architect to Ho Chi Minh City to design the interior building, referencing New Zealand landscape and landmarks, and our team follows New Zealand’s work culture.

Adopting cultural norms is just as important as strong English communication skills. The way New Zealand employees interact is different to the way their Australian, British?or Canadian counterparts do. There are country-specific terminologies, cultural references, habits, and behaviours. Without learning these, an offshore provider risks presenting a generic, potentially bland and de-personalised engagement that doesn’t deliver true value to their customers.

Another reason why outsourcing may have not worked for some is because of the small size of New Zealand businesses relative to overseas companies. When working with an overseas partner, New Zealand businesses can often receive the B, C or D team as they aren’t important to their vendors, who will often be working with major multinationals. At CodeHQ, we’re a business focused purely on the New Zealand market, so that’s not the case. It’s incumbent on us to bring our A-team each and every day because, in a market this size, we live and die on our reputation for building great software.

Like anything new or different, confidence is gained through experience. Businesses should try outsourcing with a partner that has a local presence who can serve as a bridge between the nuances of our market and the delivery scale achievable overseas.

A blended model can help companies learn best practice when it comes to managing offshore teams, and as their confidence and capability grows, their needs can evolve to a point where they’re able to run offshore teams themselves.

Commercially and culturally, our country can’t operate in a vacuum, especially when our tech industry clearly shows no signs of slowing down. With nearly 150 million new digital jobs predicted to be created globally by 2025, New Zealand businesses need to adapt, or they will fall behind.

To successfully address the serious shortages in human capital many companies are wrestling with?we need to overcome our reluctance to outsourcing and to working with skilled talent, regardless of their location. The growth of our economy depends on it.

This article is Paid Content from CodeHQ