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Why Outsource a Software Development Team to Ukraine – Benefits of Nearshoring.

Do what you do best and outsource the rest

 

Outsourcing is one of the tools for your business to achieve competitive advantages. It represents an agreement in which one company hires another company to be responsible for some business processes. Information Technology Outsourcing is one of the Business Process Outsourcing types together with Engineering Process Outsourcing, Knowledge Process Outsourcing, Legal Process Outsourcing, and Recruitment Process Outsourcing.  It exists in three forms:

offshoring_nearshoring_onshoring_outsourcing_comparsion

Onshoring means that hired resources are located in your country. For example, a company in Brussels delegates some processes to a company in Antwerp.

Nearshoring is outsourcing to a destination with a time difference of 0-2 hours. A Dutch company hires resources from a Ukrainian company – that’s a usual case of nearshoring nowadays.

Offshoring is the practice of outsourcing IT services to a country with at least 5-7 hours time difference (e.g. A Germany-based company outsources tech support to an Indian company).

There are also differentiated types of outsourcing – staff augmentation (adding skillful specialists to in-house teams), project-based model (hiring resources from a company with some exclusive expertise) and dedicated development teams (allocation of dedicated resources in exchange for access to a larger talent pool with lower expenses).

Reasons for outsourcing a software development team:

  • Greater budget flexibility and control
  • Access to specialized expertise
  • Decreased risks and operating expenses
  • No need to train specialized staff
  • Lower tax rates
  • Facilities for the dedicated teams
  • Focus of in-house teams on more meaningful tasks.

At the same time, outsourcing can be related to some threats:

  • Loss of control of a certain function
  • Communication issues
  • Possible quality issues
  • Security / confidentiality risks
  • Hidden costs
  • Impact on in-house team morale.

Among the European countries the most popular destinations for software development outsourcing in Eastern Europe are Romania, Poland, and Ukraine. IT industries in these countries are fast-growing and the developers are skillful.

16 Ukrainian IT companies are featured in the Global outsourcing 100 list. 100+ Fortune 500 companies have chosen Ukrainian IT services. As for now, Ukrainian IT companies offer consulting, open R&D centers, in addition to acting as classic outsource vendors.
Ukraine is a great place to start outsourcing software development as it has a range of benefits.

Why outsource to Ukraine

High code quality

Ukrainian IT Specialists are known for their high expertise. Developers from Ukraine are ranked 11th in the world according to the HackerRank rating in 2018. IT specialists have expertise in the majority of top popular programming languages:

  • JavaScript
  • Java
  • Python
  • PHP
  • C#
  • Ruby
  • Unity 3D
  • Node.js
  • Scala
  • Kotlin
  • Swift

Geographical proximity

Ukraine is located in Eastern Europe and you can easily reach most European cities via comfortable air connection. There are convenient flights between the biggest Ukrainian and European cities. Also, you can reach even smaller cities in Ukraine from most of the European capitals using Ukrainian International Airlines with one layover in Kyiv, the capital of Ukraine. Moreover, all of the EU citizens can enter Ukraine without a visa with just a passport alone, for periods of up to 90 days out of 180, as well as citizens of Ukraine can travel to the EU visa-free.

Time zone

Time difference of 0-2 hours between Ukrainian and European countries allows setting convenient cooperation in terms of nearshoring. This way, if an in-house team and outsourced team are the parts of your project, then their working hours will be almost the same. It’s a great advantage, as meetings can be scheduled for a convenient time for all team members. When you offshore some processes to a company, let’s say in India or China, the time difference may become a significant obstacle. A workflow may be less fluent, developers have to work late at night with no possibility to get instant feedback when necessary. Furthermore, business trips to your team won’t take the whole working day, not to mention jet lag.

Similar cultural values

The great number of developers are young people, who are open-minded and share European values. For example, the Dutch and Ukrainians are very similar mentally, and in fact, we easily find a common ground.

Large talent pool

It’s estimated that in 2019 there were about 192 thousand professional developers in Ukraine. There are 150+ institutions where IT specialists are trained with approximately 23, 000 specialists annually. Eastern-European countries are known for the high-quality higher education in technology and mathematics.

Strong National IT Community

1000+ events for IT specialists, startups and investors, that give an opportunity to share experience, grow professionally and get inspired, are held all over Ukraine every year. Our country is a home to 50+ coworking spaces and hubs and 30 industry communities. Multinational R&D centers are also located here. Ukrainian IT community is growing rapidly. It provides support for both, individual developers and for the whole industry on a state level.

Language proficiency

Proper English level is no more an advantage, but a necessity in the modern West-European society and labor market. Proficiency in English is one of the basic requirements in the Ukrainian IT industry. Good English prevents language barriers and poor communication. Graduates of the Ukrainian universities and colleges have a required English level for professional purposes.

Cost Efficiency

Ukrainian developers have won the reputation of specialists delivering products, that meet the requirements of Best Practice Standards. In the last decades, Ukrainian software developers are highly demanded in the outsourcing market. According to the rating of TechReviewer analytics hub Top 60+ Software development companies in 2020, 18 companies have their offices in Ukraine.  In comparison to Western countries salary rates in Ukraine are quite low – $25-$49/hour. This way, outsourcing can cut your expenses.

Additional services

Ukrainian outsourcing companies often offer related services, that are an essential part of software development – Quality Assurance/ Control, Dev Ops, Design, Business Analyst, Product/Project Management. Outsource companies usually have a large pool of skillful specialists in different areas, so you can hire the best ones to close your vacancies.

You can get all these benefits and even more just by letting us fill your existing gaps with necessary (human) resources. SharpMinds has 14 years of commercial experience, supplying Dutch business with qualified developers. Our dedicated software development teams have experience in such industries:

  • Fintech
  • Healthcare
  • E-learning
  • Labor market
  • Digital advertising
  • E-commerce
  • Enterprise/On-line gaming.

You can learn more about our services here.

 

Resourses:

Dou.ua, Labor Market 2019, December 2019.
UNIT.City, TECH ECOSYSTEM GUIDE TO UKRAINE, 2019.
Which country has the best developers, HackerRank, 2018
Top 60+ Software development companies in 2020, TechReviewer