How to Build and Scale a Global Engineering Team
Less than a decade ago, if you had mentioned building an engineering team, you would have been talking about where your company was based and the number of countries from which you could recruit talent. Today that has changed dramatically.
You can now build an engineering team that is globally dispersed. Many digital companies are taking advantage of this to achieve multiple benefits, including lower costs (often a smaller metro population means lower office rents), access to diverse talent pools, and faster response times.
From our experience working with companies doing this, we identified five key elements to consider when building and scaling your global engineering team.
1. Understand Why You Would Like to Build a Global Team
There are many benefits to scaling a global engineering team but also challenges. To mitigate risk, you should be able to determine the purpose of your global engineering presence. There are three common uses for a global engineering team:
To deliver products to global markets. For instance, a software company may use this model to deliver its product to multiple countries, especially those with scarce language skills.
To scale the delivery of services. For instance, an engineering team at a software-as-a-service company may use this model to manage the rollout of a new product or service in a timely and cost-effective way.
To reduce costs. This may be appropriate if a company wants to scale down its global presence or offset regional labor market imbalances.
No matter what the purpose of your global engineering team is, you need to understand the cost of running this team, where to locate the team members, and how to communicate and coordinate with this team.
2. Determine the Cost of Running a Global Team
Setting up and running a global engineering team will likely have a significant cost component related to office space, relocation assistance for team members, and overall culture fit. Depending on where you’re starting from, these costs may be significant. For a global software company whose developer base is in the Americas, the costs of running a global engineering team may be as high as 200 to 300 percent— or even more — compared with maintaining a similar team in Asia.
In other instances, the cost of a global engineering team may be lower than running a team in its home country. For example, a U.S.-based software company with a worldwide presence may find that running a global engineering team in South America costs less than in San Francisco.
The overall cost of running a global engineering team depends on several factors, such as the company’s location, customers and market locations, and the current talent pool. To formulate a realistic cost baseline, you must consider several variables.
3. Know the Size and Skillset of the Team
A global engineering team that supports a new or regionally focused product will usually be smaller (and cheaper) than one that supports a core product with new features and customers. The programming languages and technologies used by the team will also have a significant impact on cost.
4. Location of the Team Is Very Important Too
Relocating a programmer from Singapore to New York costs significantly more than moving someone from London to New York. The location also plays a significant role in the cost of living. For example, the average salary of an engineer in China is around 50 percent lower than that in the U.S., and the cost of living is over 50 percent lower in China.
The number of people in the team. More people mean higher salaries, relocation costs, office space requirements, and additional training costs.
5. Plan What the Global Team Will Be Working on Beforehand
Does the team support an essential product/service or a new product/service? An essential product/service generates revenue and contributes to the company’s bottom line, while the new one brings in additional revenue potential.
A global engineering team supporting an essential product will usually have a higher priority and must be deployed quickly. A global engineering team supporting a new product will require significantly more testing and debugging, thus increasing the cost.
Building and scaling a global engineering team is a huge challenge, but it can be overcome with the right strategy. By focusing on the right people, processes, and tools, you can create a team capable of meeting the demands of a global market. With some planning and foresight, you can build an engineering team ready to take your business to the next level.