Software development booming in South Africa – MyBroadband

The South African software development market is showing strong growth, and developers in the country are popular targets for international markets.

This is according to feedback from Entelect and Codehesion, who also highlighted what they would like to see from outsourced software development firms.

Codehesion CEO and founder Hector Beyers told MyBroadband that although South African developers are popular targets for the European market, demand has reduced slightly due to tight customer budgets.

“We still see the market in Netherlands and Germany looking to insource South African devs but budgets have seen to be tight on the customer front in these countries. We get a sense of tight budgets from Western Europe,” said Beyers.

He added that Codehesion used to get more business from overseas than locally, but this trend has shifted.

“We are seeing the South African development market performing very strongly. The overseas market used to be better for us a year or two ago,” said Beyers.

Entelect told MyBroadband that South African software development firms offer a good value proposition for the European market due to similar time zones and language and cultural similarities.

“Global mobility is high; it is possible to build distributed teams where talent selection is the priority (as opposed to purely location and cost). South Africa is increasing in interest to the European market,” it said.

To this end, Entelect has established operations in the Netherlands, United Kingdom, New Zealand, and Australia.

“Despite the competitive nature of these markets, we are seeing a steadily increasing interest in South African technology capability due to the value proposition above,” it added.

Beyers explained that companies using the services of outsourced software development firms want to expand the accessibility of self-service systems to their customers.

This includes increasing brand loyalty through various rewards programmes, making customers’ lives easier, and forming partnerships with other brands.

“We also see companies innovate through making dashboards accessible to staff or partners that drive more revenue for their organisations,” said Beyers.

“We have also seen an uptick in the code audit market in South Africa where companies want an independent view on their code basis and practices being used by their internal development teams.”

Entelect said customers’ buying decisions are driven by the availability of high-quality software at a competitive price point, meaningful partnerships with vendors capable of providing scale, and flexibility regarding engagement and commercials.

“The one-size-fits-all approach does not work due to the complex nature of enterprise structures,” it said.

Clients also require help with expanding capabilities as they grow and mature internal teams, processes, and practices.

“It helps having experienced teams come into showcase ways of working, architecture and quality practices,” said Entelect.

Opportunities and challenges

Beyers says there is a reduced focus on building good software with good principles in South Africa compared to what should be the case.

“We are picking up security issues and bad practices through our audits,” he said.

“This could be a function of too many resources entering the market without proper training or experience.”

He noted that some developers with many years of experience are being graded as junior developers through Codehesion’s interview processes.

Entelect noted that remote and hybrid work environments have significantly impacted approaches to work, and getting that aspect of work right substantially increased productivity and offered staff a better work-life balance.

Regarding opportunities in the space, Entelect said artificial intelligence and machine learning projects have surged as companies try to capitalise on automation and predictive analytics.

It noted that cloud migration and modernisation present a significant opportunity, but they aren’t without challenges.

“Cloud migration, modernisation, and cost optimisation are topical for all CIOs as they build future-ready estates while managing costs,” said Entelect.

“Alongside this, the concept of FinOps, a team dedicated to cost optimisation on large cloud estates, is increasingly common.”

“Governing and constraining cloud costs is difficult due to the freedom and ease of provisioning services on the major platforms,” it added.