Ukraine IT Outsourcing: reasons and benefits

Currently, Ukrainian IT companies look like the most desired places to work. Lots of people between 20 and 35 years can surely say that they want to work in IT. But why? Usually, people answer that they want to become IT-specialists because of good career perspectives and working for foreign customers. Why is it so important? Let’s try to understand.

A larger part of Ukrainian IT firms works in IT outsourcing as developers, managed service providers, designers, and others. At first, let’s define what outsourcing is. This is a business practice which means that one company hires another company or individual specialist to carry out some tasks, provide services, etc. This helps to delegate some specific work to professionals and simultaneously do not hire narrow specialists in-house. So, we have one company that hires and another who is hired. The underlying principle of outsourcing scheme is to keep the tasks which you can cope with well and give to your partner tasks which he can solve professionally.

Hired company is known as a service provider or a third-party provider. Talking about IT, outsourcing firms usually provide software and web development, technical support and services in other related spheres. The common causes of a customer company to use outsourcing are gaining speed, improving efficiency and reducing costs.

Also, IT outsourcing gives an ability to free some resources and redirect them to projects or tasks that give greater income than the tasks that had been outsourced.

Many Ukrainian IT firms provide software and accompanying services for foreign customers. A big part of the customers is located in the USA, Australia, and Europe. A lot of Ukrainian IT outsourcing companies are located in big cities like Kyiv, Lviv, Kharkiv, Odessa, and Dnipro. Outsourcing in IT quite developed because it’s profitable for all parties.

Foreign customers get high-professional workers with the same or higher quality of work as foreign specialists, but with a lower payment than an in-house team. In this case, a common Ukrainian IT outsourcing company gets orders which paid much better than the same orders from Ukrainian companies. And Ukrainian employees get a well-paid and interesting job. It looks like a win-win situation.

In the Ukrainian IT outsourcing industry, the leading domains are web/app/mobile development, cloud computing, design, technical support services, administration services, blockchain development, Machine Learning, Quality Assurance, Big Data, DevOps and others. The leading programming languages are React, React Native, React.js, Vue.js, Node.js, Python, Java, PHP, C#, etc.

Ukrainian awards in outsourcing

Almost every year Ukraine wins awards in this area. For example:

• fourth place worldwide by the quantity of certificated IT specialists according to Exploring Ukraine IT Outsourcing Industry 2012;
• in 2013 Ukraine took first place amongst the European countries in categories «best market value in IT outsourcing» and «the largest number of staff employed in IT»;
• in 2014 some Ukrainian outsourcing IT companies got to the TOP-5 in «The Global Outsourcing 100» rating and continue being in this rating till now;
• in 2017 Ukraine was named the «Offshoring Destination of the Year»;
• in 2018 Ukraine was in TOP-50 in the Bloomberg innovation rating.

Ukrainian companies continue to get listed in multiple prestigious ratings like Gartner, Angellist, Forbes, Forrester, Upwork, and Clutch.

Advantages and disadvantages

Thus said, does outsourcing have only positive moments? Let’s get acquainted with the advantages and disadvantages of IT outsourcing.

Customer benefits:

• cost savings and cost control;
• salary tax savings (customer doesn’t need full-time employees);
• reduction of personnel size;
• release customer’s resources for solving other actual problems;
• customer can focus on his own tasks;
• minimization of own risks.

Drawbacks and risks for the customer company:

• quality of outsourcer’s work could be worse than expected (because of the reliability and responsibility of Ukrainian outsourcing companies this risk is minimal);
• different time zones could make communication harder (for US and EU it’s not a big problem – time difference between Ukraine and EU is up to 2 hours and the USA’s daytime equals to Ukrainian evening):
• project management risks and problems (choosing a reliable company with positive reviews and good feedback from previous customers, will relieve you from these risks).

Conclusions: IT outsourcing to Ukraine is a great choice

As you see, outsourcing in Ukraine has pluses and minuses. All minuses disappear if you choose a reliable company. You’ll need some attention to details during choosing your future partner, and as a result, you’ll have only profits for your business. So, IT outsourcing to Ukraine is a great choice.