The IT industry is rapidly gaining momentum, and the coronavirus restrictions only stimulate the development of certain sectors of Information Technology. There is a team of IT specialists in almost any large company, even if business activities are not directly related to modern technologies. At the same time, the IT sphere favorably differs from other spheres by the possibility of placing a team anywhere in the world without losing efficiency. As a result, IT outsourcing has become a very popular service. Let’s talk about the advantages and prospects of opening of IT department for foreign companies in Ukraine.
What do foreign companies get from opening an IT department in Ukraine?
The main advantage of IT outsourcing is the ability to reduce operating costs. Ukraine offers more competitive rates when compared with neighboring Poland, Belarus and the Czech Republic. An average programmer’s earnings range from USD 1,400 to USD 3,300, which saves customers 35–75% when compared with similar specialists from the United States and Western Europe.
In addition to reducing costs, such a business model allows to:
- optimize taxes;
- reduce HR costs;
- open a department near large clusters of potential candidates (for example, in cities with large universities).
Outsourcing is one of the most effective business tools. Its competent application can significantly increase the competitive advantages of the company.
Why Ukraine is the best choice for IT outsourcing
The main advantages of Ukraine as a platform for hosting an IT department:
- Wide range of candidates. The Information Technology market in Ukraine is developing rapidly. In 2020, about 200,000 specialists worked in the field. The market is expected to grow by another 23% in the next 4 years.
- Special conditions of taxation. The vast majority of specialists are registered as sole proprietors. Such IT specialists work on a simplified taxation system, the general rate is only 5%. This allows customers to save on administration costs, as well as pay higher salaries at similar costs (in most countries taxes are higher for this form of cooperation).
- Highly qualified specialists. Ukrainian IT specialists are on the 5th position among the best software developers (4 in Europe). Experts are fluent in all popular programming languages, ranked 1st in the world in terms of the number of Unity3D and C ++ engineers.
- Digitalization of services. Ukraine was the first to launch e-passports, legally equating them with ordinary documents. In the future, it is planned to place an even stronger emphasis on digitalization.
Other advantages include a good knowledge of the English language, a favorable business climate, as well as the focus of Ukrainian developers on continuous development.
Companies already operating in Ukraine
Global market leaders are actively showing interest in local startups. Google bought the Viewdle facial recognition platform, Snapchat acquired Looksery, a real-time face modification service, and Oracle includes Ukrainian marketer software provider Maxymiser. In recent years, Kiev has attracted more investors than Warsaw, Vienna and Copenhagen. A similar situation occurs in the outsourcing market. Ukrainian IT specialists work closely with German, Dutch, Danish, British and American corporations. IT departments have already been opened by such companies as:
- Playtech etc.
11 companies from Ukraine are among the top 100 outsourcers in the world.
What you should know to open an IT department in Ukraine
The government actively supports the Information Technology sector. Now work is being carried out on the Diia City project – an IT hub in the country with a special legal regime. Such a start-up platform allows you to save on taxes, avoid bureaucracy and attract additional investment.
On the other hand, non-residents may also have certain difficulties associated with:
- search and arrangement of an office;
- selection of highly qualified specialists;
- payment of taxes and payment of wages;
- contract management, etc.
The simplest and most effective solution to these problems will be cooperation with a specialized intermediary who thoroughly understands both the Ukrainian realities of the IT business and the peculiarities of the functioning of foreign enterprises. The outsourcing company will delve into the problems of a particular customer, guaranteeing a quick and effective solution to any problem.
How to ensure the well-coordinated work of the IT department of an international company in Ukraine
Ukraine is the geographical center of Europe. Direct flight from major EU cities to Kiev takes about 2-3 hours. Adjacent time zones allow you to almost completely avoid jet lag problems. Visa-free regime for EU citizens. Ukraine has a 7-hour difference with the USA, which is more convenient when compared with India, Vietnam and other Asian IT outsourcing centers. Thanks to this, there will be no special problems either with online conferences or with periodic real meetings.
In addition to communication, careful control is also important. There are two effective ways to solve this problem: registration of foreigners for managerial positions or contacting a specialized outsourcer who will be responsible for the selection and motivation of specialists. For foreign companies SmartSolutions BPO offers:
- constant communication with a personal manager;
- recommendations for optimization of business processes, regular search for new solutions;
- systematic reports on completed tasks.
All this will allow you to synchronize work between geographically dispersed teams.
Benefits of working with Smart Solutions BPO
Smart Solutions is a reliable BPO provider capable of launching an IT department in Ukraine on a turnkey basis. The main benefits of cooperation:
- 4 international offices;
- extensive team of IT specialists, accountants, lawyers and HR-managers;
- full project support (outstaffing & payroll, office provision, legal consulting, recruitment);
- wide range of additional services (wage market review, labor protection, etc.).
IT outsourcing is a huge prospect, but also high risks. By entrusting the opening of the information technology department to Smart Solutions BPO, customers will be able to avoid many problems, ensuring the stable and efficient work of a remote team.