Set Up an ODC for Saudi Arabia: Step-by-Step Guide [2025]

How to Set Up an Offshore Development Center Serving Saudi Arabia: A Step-by-Step Guide

An Offshore Development Center (ODC) is a dedicated facility in another country that functions as an extension of your organization's technology team. For Saudi enterprises facing intense competition for local tech talent and escalating salary demands, an ODC in Jordan or Egypt offers a proven path to building scalable, high-quality development capacity at 40–60% lower cost. This demand is largely driven by Vision 2030's massive technology workforce requirements, which we analyze in detail in our Vision 2030 technology workforce guide.

This guide walks you through every step of setting up an ODC that serves the Saudi market effectively.

Step 1: Define Your ODC Strategy and Objectives

Before selecting a location or hiring anyone, clarify your strategic objectives:

What functions will the ODC handle? Common functions include:

• Application development and maintenance
• Quality assurance and testing
• SAP development and support
• Cloud infrastructure management
• Data engineering and analytics
• Mobile application development

What is your target team size? Plan for your 12-month and 24-month targets. Most ODCs start with 5–10 engineers and scale to 20–50 within two years. Larger enterprises may target 100+.

What is your governance model? Will the ODC report to a local CTO, a VP of Engineering, or a dedicated offshore program manager? Define reporting lines early.

What are your success metrics? Define KPIs before launch: productivity metrics (story points, velocity), quality metrics (defect rates, SLA compliance), cost metrics (cost per developer, TCO comparison), and satisfaction metrics (client NPS, team retention rate).

Step 2: Choose Between Jordan and Egypt

Both countries are excellent ODC destinations for Saudi enterprises. The choice depends on your priorities:

Choose Jordan when:

• Timezone alignment is critical (same timezone as Saudi Arabia)
• You need frequent in-person visits (2.5 hours from Riyadh)
• Your projects require deep Saudi market knowledge (many Jordanian developers have Saudi project experience)
• English proficiency is a top priority
• Team size is 5–30 engineers

Choose Egypt when:

• Cost optimization is the primary driver (15–25% lower than Jordan)
• You need large teams quickly (Egypt's talent pool is 4–5x larger)
• Your projects are less Saudi-specific and more general technology
• Team size is 20–100+ engineers

The hybrid approach: Many Nextwo clients operate teams in both countries — leveraging Jordan for senior roles, client-facing functions, and Saudi-specific projects, while using Egypt for larger development squads and cost-sensitive workstreams. This approach combines the strengths of both markets.

Step 3: Choose Your Operating Model

You have three main operating models for establishing an ODC:

Build-Operate-Transfer (BOT): Partner with a local provider who builds and operates the ODC on your behalf. After 2–3 years, the operations transfer to your ownership. Best for companies committed to long-term offshore presence but lacking local expertise.

Managed ODC: A partner like Nextwo builds and operates the ODC indefinitely. You direct the work; we handle HR, facilities, compliance, and operations. Best for companies wanting ODC benefits without operational complexity.

Self-Owned ODC: Establish your own legal entity and hire directly. Maximum control but requires significant investment in legal, HR, facilities, and local management. Best for very large teams (50+) with long-term commitment.

Step 4: Build Your Team Structure

A well-structured ODC team typically includes:

Core Engineering Team

• Technical Lead / Architect (1 per 8–10 developers)
• Senior Developers (30% of team)
• Mid-Level Developers (45% of team)
• Junior Developers (15% of team)
• QA Engineers (1 per 4–5 developers)

Support Functions

• Project Manager / Scrum Master (1 per 10–15 developers)
• DevOps Engineer (1 per 15–20 developers)
• Business Analyst (for requirements-heavy projects)
• UX Designer (for customer-facing products)

ODC Management

• Site Manager (responsible for facilities, HR, and operations)
• Delivery Manager (responsible for project delivery and client satisfaction)

Step 5: Establish Infrastructure and Security

Enterprise-grade ODC infrastructure must include:

Physical Infrastructure

• Secure office space with access control systems
• Redundant internet connections (minimum 2 ISPs)
• Backup power (UPS and generator)
• Ergonomic workstations with dual monitors
• Meeting rooms with video conferencing equipment
• Server room (if required for on-premise hosting)

IT Security

• Enterprise VPN connecting ODC to client networks
• Endpoint protection and device management
• Data Loss Prevention (DLP) tools
• Identity and Access Management (IAM)
• Network monitoring and intrusion detection
• Regular penetration testing and security audits

Compliance

• ISO 27001 certification (or working toward it)
• Compliance with Saudi PDPL (Personal Data Protection Law)
• NCA (National Cybersecurity Authority) alignment if serving government clients
• SOC 2 Type II compliance for financial sector clients

These security considerations align with the frameworks we detail in our article on security strategy when outsourcing IT operations.

Step 6: Implement Governance and Communication

Effective governance bridges the distance between your headquarters and the ODC:

Communication Cadence

• Daily stand-ups: 15-minute team syncs via video
• Weekly status reports: Automated from project management tools
• Bi-weekly sprint reviews: Demo sessions with stakeholders
• Monthly steering committee: Strategic alignment and escalation

Escalation Matrix

Define clear escalation paths for technical issues, resource concerns, quality problems, and security incidents. Ensure both onsite and offshore teams know who to contact and when.

Knowledge Management

• Maintain comprehensive documentation in Confluence or Notion
• Record key meetings and architectural decisions
• Create runbooks for operational procedures
• Implement a wiki for institutional knowledge

Step 7: Plan Your Launch Timeline

A realistic ODC launch timeline with an experienced partner:

Weeks 1–2: Planning

• Finalize strategy, team composition, and technology requirements
• Select operating model and governance framework
• Define infrastructure and security requirements

Weeks 3–4: Setup

• Secure office space and infrastructure
• Begin recruitment for core team members
• Establish VPN and security protocols

Weeks 5–8: Team Formation

• Complete hiring for initial team (5–10 members)
• Conduct technical assessments and onboarding
• Set up development environments and tools

Weeks 9–12: Ramp-Up

• Knowledge transfer from headquarters
• First sprint execution
• Initial code contributions and reviews
• Refine communication and governance processes

Months 4–6: Optimization

• Scale team to target size
• Establish performance baselines
• Conduct first quarterly review
• Implement continuous improvement processes

Common Pitfalls and How to Avoid Them

Pitfall 1: Treating the ODC as a cost center, not a strategic asset

Solution: Involve ODC members in product decisions, innovation sessions, and strategy discussions. They should understand the "why" behind what they build.

Pitfall 2: Insufficient onsite leadership

Solution: Designate a senior technical leader onsite who acts as the bridge between business stakeholders and the ODC team.

Pitfall 3: Neglecting team culture

Solution: Invest in team building, cross-site visits, and shared celebrations. Culture is the glue that holds distributed teams together — as we discuss in our article on motivating remote software teams.

Pitfall 4: Over-documenting, under-communicating

Solution: Documentation is necessary but not sufficient. Supplement written specs with video walkthroughs, pair programming sessions, and informal discussions.

The Nextwo Advantage

Nextwo has established and operates ODCs for multiple Saudi enterprises across industries including banking, telecom, government, and retail. Our managed ODC model provides clients with dedicated teams, enterprise-grade infrastructure, and operational management — all backed by SLA commitments and transparent reporting.

Whether you're setting up your first ODC with 5 engineers or scaling an existing operation to 50+, Nextwo's experience across Jordan and Egypt ensures a smooth, risk-mitigated launch that delivers results from month one.

Frequently Asked Questions