Ukrainian IT outsourcing: now and tomorrow

Outsourcing UA

Aftermath of Revolution

Last summer we have had slightly reviewed state of affairs of our Motherland’s digital industries, their achievements and troubles, especially in field of outsourcing [1]. We’ve even defined overall trend as “Revolutionary” [2] and it’s still quite true. All we have now and before us, was brought to existence by Maydan Tea Party. But now, has the trend changed?

Obviously, the time has come to update your data on Ukrainian IT outsource and its perspective.

Main points made year ago:

  • Ukrainian market began to bloom after revolutionary events of 2013-14;
  • Notable cities of the industry then were Kyiv, Kharkiv, Lviv, Dnipropetrovsk;
  • Chief rivals of Ukraine (f. i., by work hour fees) were India and Pakistan;
  • Key directions of demand are cloud security and apps for management  of outsourcing itself;
  • Western clients could look also for part-time load;
  • IT industry is intended to satisfy the needs of western markets more than ever before;

Results of 2015

Now, an additional summary was found [3], showing deterioration of inner IT-market of Ukraine in 2009-13 (before the Revolution) – which allows us to assume that turning point of history was also the turning point of IT outsourcing paradigm. Meaning, only in 2014 wide range of companies had openly become oriented to sell our services (and products) on Western markets.

 

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Still, the bloom had not turn into a boom. The Revolution had lost its “R” and became, which is logical and good, too – an evolution. There was and is no miracle solution – only hard work.

There are several accounts of year 2015 of Ukrainian IT outsourcing.

 

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IT Lawyers prophet our country to become sort of a digital innovation area, “next Silicon Valley” [4]. Focal points are:

  • There are thousands of IT specialists graduated from higher educational institutions, many of them budget-paid; also some attend free online courses and get jobs, and cost of living is lower than in most countries (basically, this indicates to an investor that our workforce is cheap and coin-operated – editor’s remark);
  • About 1/3 of outsourcing orders in Europe is completed by Ukrainians, with Russians at second place with 1/5 [5];
  • 2015 was a difficult year for half the IT industry, yet not catastrophic, and growth was only slowed not stopped (hence evolution instead of revolution – editor’s remark);
  • Government had passed some laws against suppression of IT ;
  • Finally, big companies, such as Samsung, Huawei, Siemens, ABBYY, Wargaming are opening their R&D facilities in Ukraine, so this trend could be growing, especially considering above points; because a new technological base could develop, well, basically, unfold in a matter of some months.

ITC spills cold shower on hot heads of dreamers [6]: not only Ukraine’s place in word IT business is 51st, but it is an actual drop from 41st, which was in its turn a drop from 38th. That is, dull perspective is dreadful. Of course, the statistics doesn’t show if some of the developers contributing to foreign economies are Ukrainian migrants, living outside homeland’s border.

 

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National business rating celebrates, nevertheless, that among Top-100 IT companies of the world (IAOP rating), there are many Ukrainian ones [7], namely, Lviv company SoftServe, which is considered top UA IT outsourcer.

 

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Conclusions

Better forecast

Generally, Ukraine is a nice place for IT R&D, both software and hardware. And if it is going to be developed, is purely linear dependency of amount of work done.

Silicon Valley dream could be a good goal and way to bring glory to our land. So if we just draw it out nicely and work together, we would achieve. Mere presentation of successful projects, huge, big, small and tiny would attract investors and clients from everywhere – to add the spirit of Revolution to such seemingly unemotional area as digital industry.

We can do it.

Worse forecast

Deploying new projects here to work full-scale in a matter of less than half a year is wishful thinking, given inertia of mentality of some of the possible workforce and corruption of some individuals in different levels of authorities.

This provides vital conditions only for some big companies, while start-ups still have to gnaw their way through, not to mention solo freelancers.

Although, these are only troubles to fight with, not our fate.

 

Commoner’s opinions

 👿 And now, all these people, except for leaders of the market are presented to investors as cheap workforce? It’s hardly true! Freelancers who earn in USD and Euro prefer to spend their money in the countries where these money circulate, and eventually best of them move abroad! And I have a feeling they all run like rats!

 

 :-) We have lots of educated people who simply love their homeland, and whether living abroad or at home – they wish her the best, they devote their findings to her, they directly send money back home, they promote goods and services with yellow-blue tint of accuracy and warmth to them. That would eventually prevail.

Sources:

  1. Ukrainian Outsourcing on the march
  2. Ukrainian code: Fuel the fire
  3. Украинский рынок ИТ: подводные камни и резервы роста
  4. 5 reasons to open your R&D center at Ukraine?
  5. Ukrainian developers on top in Eastern europe/
  6. Украина заняла 51 место по объему рынка IT-аутсорсинга (инфографика)
  7. Лидеры украинского IT-аутсорсинга продолжили рост