Outsourcing to Ukraine in 2017
Ukrainian Outsourcing 2016 Overview
Ukraine is a country that is located in the heart of Europe with high IT-potential, low labor costs and developed business infrastructure. IT industry in Ukraine is one of the rapidly growing sectors of the economy in comparison with other industries that outsource their products and services abroad. The development of IT-outsourcing in Ukraine is one of the most significant achievements of the country over the past few years that allows speaking about positive trends in outsourcing.
IT outsourcing trends 2016 made a great impact on the industry that we will be able to sess in the current year. 2016 was marked by significant achievements in this sector. Ukraine took the first place in Europe in the sector of IT-outsourcing, according to IT Outsoursing News. In addition, in 2016, Ukraine is among TOP 25 countries in the rating of outsourcing Global Services Location Index according to the data of AT Kearney. This study ranks countries according to estimates in three categories: financial attractiveness, specialist skills and the availability of labor and business environment.These two events gave the start to all the rest trends in IT outsourcing.
It is possible to underline Ukrainian IT outsourcing trends 2016:
1) The industry grew by 15-20%, while the market grew from $2.5 billion to $3 billion. The volume of IT-export in 2016 was about $3.2 billion;
2) The need for support and development of IT-industry as a strategically important area for the Ukrainian economy was recognized by authorities. Actual actions in this direction were the adoption of the law on the simplification of export services for the development of IT-industry and increase in the state order for graduates of technical specialties;
3) 100 000 IT-specialists and more than 100 R&D centers of the world’s high-tech companies such as Cisco, Oracle, Rakuten, Samsung were working in Ukraine in 2016;
4) 80% of services were provided to customers from the USA.
5) rapid development of IT consulting services.
IT OUTSOURCING TRENDS 2017
2017 gave a positive impetus to trends in IT outsourcing, as 13 Ukrainian companies were included in the ranking The 2017 Global Outsourcing 100. Nevertheless, main tendencies of IT outsourcing 2017 in Ukraine will depend on the results of interaction between business and government. Experts express an opinion about the growth of export volumes in 15-20% in 2017 in the currency, while maintaining the current regulation of the industry, and also on the condition of creating up to 20000 new high-paying workplaces, in particular, in IT consulting services.
There are the main purposes of IT outsourcing 2017 in Ukraine in order to keep it promising:
1) Education reform, intellectual property protection, simplification of the business environment, clear national strategy for the development of IT-sector are urgent for the development of the industry;
2) Saving sustainable tax environment for IT-companies and entrepreneurs who are now working for export;
3) Global and the main objective, which is important not only for IT, but for the entire national economy, is the development and preservation of talents in Ukraine. This can be achieved only through the creation of competitive conditions in comparison with other developed countries (Western Europe, USA, Canada).
It is important to remember that all these purposes should be realized in parallel in order to keep positive trends in outsourcing.
What Is Better Outsourcing or Outstaffing?
We have reviewed IT outsourcing trends 2017. Despite all its benefits, many of the companies prefer to use the services of outstaffing for their projects. This fact is explained by the rapid development of technology and the constant launching of large projects for which outstaffing is more beneficial. First of all, outstaffing allows relocation of personnel, which in turn makes it possible to control the process of development and directly alter the course of the project. In addition, outstaffing enables enterprises to maintain the status of a small business that has a positive effect on the taxation form.