Ukraine is racing for supremacy in the present outsourcing era, and how! In a span of just 10 years, Ukraine has established itself as Asia's fastest growing IT offshore outsourcing destination competing with the likes of India, Philippines, Qatar, and Singapore. With a promising track growth, and having gained $1.8 billion in 2013 alone, Ukraine's outsourcing industry has come a long way in the last decade. With the availability of low-priced resources, Ukraine succeeds at offering top grade IT sourcing solutions at an affordable cost, which inspires good business investment for the fastest upcoming industrial region in the erstwhile Soviet.
How is Ukraine Faring in the IT Outsourcing Race?
Companies look out for Ukrainian capital, Kiev, as a fascinating destination to gain access to, and hire skilled software engineers at an affordable cost. Ukraine is today world's fifth largest IT outsourcing services market. The country manages to cash in US$ 3.3 billion per year, mainly driving its revenues from near-shoring for businesses based in Western Europe and India.
Let's have a look at 5 factors that have helped Ukraine lure investors:
1. Presence of Skilled IT Professionals at an Affordable Cost
Ukraine offers excellent opportunity for manpower resourcing owing to its potent educational system that produces 25,000 IT professionals every year. Native engineers are excellent IT exponents showcasing their employability owing to strong education system that boasts of concepts in cybernetics, mathematics, and computer science. Training them is must (due to poor practical knowledge) but easier, supplemented by lower salary and wage expectations.
2. Favorable Government-Investor Relationship
Backed by lower administrative costs and creative approach designed by the Ukrainian government, the outsourcing industry has a high prospect of promoting growth for domestic as well as foreign investors. Ukraine piped the likes of Mexico and Philippines, winning the prized award for "Outsourcing Destination of the Year" in Europe in 2011 that further reinforced Ukraine's reputation among western investors. The market managed to scale 40% increase in 2010 and 35% raise in 2011, despite recessional drubbing in the 2008-2009 period. However, the current chaos in Russia and neighboring areas is making people vary of investing in Ukraine.
3. Cyber Laws and Intellectual Property Rights
Since IT efficacy involves understanding of intellectual property, Ukraine is reasonably advantageous to the companies, as under Ukraine's IP laws, copyright protection is available for indigenously developed computer programs and databases, thus cutting down need to transfer obligations. Ukrainian cyber-governance is also stronger compared to other outsourcing destinations, owing to continuous wave of hacking events that it's inflicted with.
4. Complete Business Package within the Zone
Ukraine offers holistic growth opportunities to industries associated with outsourcing services like warehousing/logistics, aviation, telecommunications, accounting, training services, and engineering drafts. Business investors who explore opportunities in CAD-CAM modules in plant automation, game, and graphic designers, 3D imaging operations, biometric control and identification, GPS control and navigation have also managed to secure a strong foothold in Ukrainian model. However, the same can't be said about other domains.
5. Geographical Location
Ukraine's geographical location works as a link between Russia and Europe thereby availing magnified opportunities. Strong political willpower to enhance economy and social structure, concrete IT laws and business laws are helping the country in competing with leading outsourcing destinations like India. If Ukraine manages to tie its loose ends, it could become promising IT outsourcing destination, next only to Indian IT industry which still continues to rule the roost.
India or Ukraine - What Would You Prefer?
Although, Ukraine comes with a host of advantages when it comes to outsourcing, India still rules the roost with many studies placing India as the most preferred outsourcing destination. And when it's the game of numbers and talent that you are playing; then India beats many close competitors with its vast pool of qualified and ready-to-employ resources at a highly-competitive rate.