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Today, we are facing serious changes in the software industry as a whole, and particularly in the pattern of demand. These changes raise new challenges and open windows of opportunities. The Western businesses, who are the main clients for the Ukrainian software industry, put out some new requirements in contrast to those they had at the dawn of this industry’s development.
“It’s the quality that is of importance for the Western customer now”, says Dmitry Sverdlik, CTO at Innovecs, an American business technology outsourcing company headquartered in Ukraine.
Ukrainian outsourcing industry evolved in the period before the economic decline of 2008 in the US when big money was pumped into projects and there was no talk of any cost reduction. US companies used to come to Ukraine to outsource large-scale projects, and the largest Ukrainian outsourcing companies excelled because they successfully adopted a business model tailored to implement large-scale projects, which was a priority then. They were very good at finding workforce quickly and selling their product in the US and that’s how they built their business on.
However, such approach has a serious drawback: meeting the demand for large-scale projects often entails the issue of quality loss. After long years of exploiting such business model, most of Ukrainian IT outsourcing “giants” have developed a retailer mentality and lost the skills of a production company which can independently perform the entire production process.
Now is the time when the Western client is looking for companies who are able to implement the major part of the product, who understand the US market, and who can take up an idea brought to them by the client and carry it out from inception to market launch. The Western client expects the service provider to take care of the entire product lifecycle – and this is where smaller companies, the likes of Innovecs, step in with their expertise.
”Of course, if we are approached by a customer and asked to engage 300 staff tomorrow we will not be able to do that, we will not even think of doing such projects. But if we are approached by a company with a complex hi-tech task, while they have only three staff in California who set an overall idea, and the major product cycle is transferred to us, we will certainly win this sale. We can do it because from the top down we have people with unmatched expertise in engineering who understand engineering problems and client’s objectives”, says Dmitry.
Why did such serious changes in the software industry happen? Dmitry believes that there are two global trends taking place in the West today. Firstly, it is cost saving. This applies to both multinationals and kitchen businesses – after 2008 all Western customers are focused on cost saving.
Secondly, it is a decline in quality and quantity of engineering workforce graduated by western universities. Apart from high-tech hubs the engineering profession does not enjoy much popularity in the US, and this is a problem recognized by the government as well.
Too little money and too few engineers – these are the two major challenges faced by today’s software industry. Those who understand it today will become masters of this market tomorrow. A flexible company meeting the market realities – this is what the Western customer needs now.
Innovecs does their utmost to extend the Silicon Valley engineering spirit and create the best software products for worldwide customers. We create advanced box products and enjoy working on complex projects requiring highly qualified experts and non-standard engineering solutions. And that is what differs us in the Ukrainian software market.
Innovecs is an American company specialized in technology outsourcing in Central and Eastern Europe, established in 2011 by leaders with decades of combined experience in global software outsourcing business.
Headquartered in Ukraine with business offices in the US, UK, Israel and Russia and delivery centers US and Ukraine, the company provides multiple service offerings including business technology advisory, software development, quality control and testing services for technology companies and software-enabled enterprises all over the world. We have created an outstanding technology team which has been responsible for more than 2,500 projects of distributed software development for more than 150 companies worldwide, including Fortune 500 and NASDAQ 100 companies.