What does Aricent Technologies

12 reasons to outsource IT to Ukraine and work with developers from Ukraine


According to Hays.de, 65% of German companies take IT outsourcing as an opportunity to develop further and to meet the shortage of skilled workers. The trend towards IT outsourcing to Ukraine is also increasing.

What is currently preventing German companies from IT outsourcing?

reasonsolution
1. Avoiding cooperation with external service providers and perceiving difficulties in managing remote employeesDo not worry. Outsourcing providers seek tips and training for customers who have little or no experience with remote teams. Successful cooperation is also in the interests of the partner. At Daxx we spend a lot of time helping our customers manage their teams efficiently
2. Language barriers: poor or poor knowledge of English80% of developers from Ukraine have a good enough command of English to write emails or attend meetings. In addition, at Daxx we check the English level of every developer we introduce to customers. Talk to the developers yourself before working with them.
3. The provider's lack of transparency makes it difficult to assess the riskSecurity is very important for companies operating in Ukraine. In addition to a transparent pricing model, Daxx is continuously improving its security system. Our ISO 27001: 2013 certification, which we received in 2020, confirms the high quality of our information security management system.
4. Poor quality of workDevelopers from Ukraine are among the most sought-after IT professionals worldwide due to their solid technical knowledge, their good English skills and their knowledge of cutting-edge technologies such as AI, big data, blockchain, etc.
5. German as a necessary requirement in communicationInternational communication in English is becoming increasingly important in companies. You should consider switching your development to English. At Daxx, however, we also have German-speaking employees to reduce misunderstandings.

Your guide to nearshore software development in Eastern Europe

The software development market in 8 of the top target countries in Eastern Europe - Poland, Ukraine, Romania, the Czech Republic, Hungary, Bulgaria, Belarus and Croatia.

Also because German companies prefer to outsource nearby, Ukraine, with its booming tech ecosystem and a large, well-trained talent pool, can be a really attractive solution.17% of German companies choose Ukraine as a location for IT outsourcing. .


6 main reasons to outsource IT to Ukraine:

  • Ukraine is number 1 in IT outsourcing market in Eastern Europe (Outsourcing Journal)
  • Ukraine is considered the Offshoring Location of the Year 2017 (GSA)
  • Largest outsourcing volume in the CEEOA countries
  • Ukraine is one of the top 20 outsourcing destinations in EMEA (Gartner)
  • In terms of outsourcing volume (A.T. Kearney), Ukraine is one of the top 50 countries worldwide (A.T. Kearney)
  • Ukraine is among the top 25 exporters of IT services (PwC)

1. 200,000+ IT professionals

Software development is considered to be the most advanced and popular sector of the Ukrainian economy. The sales of the Ukrainian IT industry are expected to reach US $ 10 billion by the end of 2020. According to PWC, Ukraine ranks 5th among the 25 largest exporters of IT services. In 2017, the number of employees in the IT environment grew by 27% and currently comprises a total of over 200,000 IT specialists.

In addition to relocation to Germany, IT companies increasingly prefer to employ developers directly in the Ukraine, as they can work relatively easily with highly qualified specialists. With an average score index of 93.17%, Ukrainian developers are ranked 5th among the best software developers in the world. Ukrainian software developers take 4th place in Europe. (Skillvalue 2019 report)

Developers from Ukraine take 5th place among the best software developers in the world

Developers from Ukraine take 4th place among the best software developers in Europe

Software developers in Ukraine have a wide range of technology skills, JavaScript (18.4%), Java (15.4%), C # (13.7%), Python (13.2%), and PHP (10 , 8%), are the most popular programming languages ​​of 2020 (2).

Technologies popular with developers from Ukraine

According to Daxx LinkedIn research, roughly live 9,000 PHP developers,8,000 Java programmers, 8,000 JavaScript developers, 3,000 Python developers and 1,000 Ruby on Rails software developers in Ukraine.

Ukraine ranks first in the world in terms of the number of Unity3D game developers and C ++ engineers and second in terms of JavaScript, Scala and Magento developers.

Ukraine also ranks third in terms of the number of Node.js, Python, ASP.NET, Ruby, Symfony and PHP developers.

Developers from Ukraine: popular technologies

Ukraine ranks fifth in terms of the number of front-end web developers. Fortunately, there is also no shortage of Android app developers and iOS developers (3).

Front-end developer from Ukraine

Why do German companies develop their software in Ukraine?

Find out about the state of the Ukrainian IT market and why Ukraine is an attractive location for IT outsourcing.

2. 36,000+ IT graduates annually

The 402 universities and colleges in Ukraine (4) produce more IT graduates than many countries known for innovation such as Japan, Sweden, Belgium, Norway, Belgium or the Netherlands (5). Because of this large selection of software developers, many companies choose to outsource IT to Ukraine.

Each year more than 36,000 students graduate from universities with degrees in computer science. In addition, the World Economic Forum has named Ukraine as one of the top ten countries in the world as measured by the number of engineering, manufacturing and construction graduates, producing a total of 130,000 graduates annually.

Countries with the highest number of computer science graduates

Ukraine also offers various educational opportunities for students willing to join the high-tech community. In cooperation with local software development companies, regional IT clusters regularly start educational programs at universities and initiate innovation laboratories at schools and universities.

The IT cluster in Lviv, for example, recently launched educational programs in emerging disciplines such as AI, data science, IoT and computer science at two leading universities in Lviv.

3. Over 1500+ companies in software development

The number of software development companies in Ukraine increased from 1050 in 2011 to 1391-1650 in 2020. They offer practically the entire range of services, from web and mobile development, UI / UX design, quality assurance and testing to team building for dedicated Teams, R&D services, IT consulting, and much more.

However, quantity shouldn't be the only determining factor. More than 100 of the Fortune 500 companies cooperate with companies active in Ukraine. 18 service providers in Ukraine are among the top 100 outsourcing providers in the world.

4. Over 2,000 emerging startups

The biggest startups in Ukraine are:

  • Jooble
  • DepositPhotos
  • grammar
  • GitLab
  • PetCube
  • Mobalytics
  • Preply
  • Attendify
  • CleanMyMac
  • InvisibleCRM
  • Looksery
  • Readdle

World market leaders have already shown keen interest in the Ukrainian startup scene, which has led to a number of large acquisitions. Viewdle was taken over by Google, for example, and Looksery by Snapchat - a real-time app for face modifications. Oracle acquired Maxymiser, a Ukrainian provider of cloud software for marketing.

At Disrupt SF 2016, the Ukrainian startup Mobalytics won the startup Battlefield.

In addition, Kiev, the capital and most important technology center of the country, has more investors than Warsaw, Vienna, Oslo and Copenhagen (7). These include AVentures Capital, the Chernovetsky Investment Group (CIG), Digital Future, the Imperious Group, SMRK, TA Ventures and Vostok Ventures.

In addition to venture capital funds from countries such as Great Britain, Germany, the Netherlands etc., Ukrainian IT companies maintain close business relationships with customers from major European cities. As a result, the total amount of venture capital invested in Ukrainian startups was $ 258 million in 2017 and $ 336.9 million in 2018, and continues to grow.

5. 100+ international R&D centers

Given that Ukraine has one of the most innovative IT sectors in the world (5), it is not surprising that there are over 100 R&D centers of global technology giants, including Boeing, Ericsson, Siemens, Oracle, Aricent, Magento, and Wargaming. Many of these companies entered the market through M & As, jointly operated R&Ds or outstaffing providers such as Daxx.

6. A dynamic IT community

The Agile Eastern Europe Conference, PyCon Ukraine, iForum, IT Arena, and DEV_Challenge are just some of the largest events that offer a platform for meeting and exchanging ideas about trends and changes in the IT landscape. According to a recent survey by developer.org.ua, 60% of all Ukrainian developers regularly take part in specialist IT events.

There are 5 very important IT communities in Ukraine: In Kiev (over 25 members), Kharkiv (73 members), Lviv, Dnipro (29 members) and Odessa (18 members).

The largest conferences attract up to 7,000 attendees and bring together international speakers from global companies such as Skype, IBM, HP, SAP, Intel, and Dell, to name a few. Smaller events are constantly happening at the local level, which often revolve around the hottest topics like AI, big data, virtual and augmented reality, data science, blockchain, etc.

7. 85% of developers in Ukraine speak English

Eighty-five percent of developers in Ukraine say they have intermediate or higher levels of English (9). The majority of companies that provide software development and IT outsourcing in Ukraine also organize free English courses for staff communicating with customers, which constantly improves the general level of English proficiency.

English skills of developers in Ukraine

8. Little cultural distance

The prevailing work ethic in the Ukrainian IT industry is very similar to that in most Western European companies. Ukrainian IT specialists are not only geared towards performance. You are very open to challenges and disagreements, are actively involved in the projects you are working on, and are interested in discovering new paths to success. This is especially true when you are in direct contact with the software developers and there is no third party in between.

9. Attractive financial framework

Compared to Poland, Belarus and the Czech Republic, Ukraine has, on average, more competitive cost structures and a larger number of available skilled workers.

The average hourly software development rate is between $ 25 and $ 50, with the average monthly software developer salary of between $ 1,400 and $ 3,300 per month (after taxes and social security contributions).

IT Outsourcing: Average hourly rates for software developers by region

Admittedly, a cheaper IT outsourcing alternative can always be found. Ukraine is culturally and geographically close to Germany, however, and is still considerably cheaper than Western Europe, North America and other Eastern European countries, where a software developer of similar caliber costs almost or over $ 100 an hour.

In addition, licensing reforms have greatly improved the ease with which business can be carried out in the country.

10. Favorable business climate for IT outsourcing to Ukraine

Year after year the Ukrainian government harmonises its economic policy with international standards and tries to create a favorable business environment. In the second quarter of 2019, gross domestic product grew by 4.6%. The Ukrainian government has already approved its 2020 Strategic Action Plan, which includes the repeal of 450 outdated regulations, support for innovation initiatives, improved corporate governance of state agencies and privatization.

In addition, in the past 5 years, Ukraine has gained 32 positions in the World Bank's 2020 Ranking on Simplicity of Business by introducing a number of regulations. Dealing with building permits has been made easier by lowering fees. In addition, the tax system has been simplified by setting the social contribution payable by employers at a uniform 22% (previous rates varied between 36.76% and 49.7%).

All of this has contributed to the growth and development of the local IT sector and is leading more and more companies to choose Ukraine as a location for IT outsourcing.

11. One hour time difference to most European countries, 7 hours before the USA (EST)

As Ukraine is only one hour ahead of most European countries and geographically close, it is a practical location for nearshoring, as the flow of work and communication can be more easily organized between geographically dispersed teams.

A direct flight from Ukraine to major European cities never takes longer than 2-3 hours. \

Ukraine International Airlines offers regular direct flights from Ukraine to London, Berlin, Amsterdam and other major European technology centers. For example, there are at least 3 direct flights per day between the Ukrainian capital Kiev and the largest airports in London (Heathrow, Gatwick and Luton), offered by Ukraine International Airlines or British Airways. To keep ticket expenses down, you can travel to major Ukrainian IT metropolitan areas such as Kiev, Kharkiv or Lviv in London with Ryanair or Wizz Air UK for only € 18 or € 22. There are also regular direct flights from Kiev to Amsterdam or Berlin, offered by Ukraine International Airlines, KLM or Wizz Air.

Ukraine has also established itself as an attractive IT outsourcing location for North American companies, as the 7 hour time difference between Ukraine and the east coast offers the possibility of much more convenient shared destinations compared to India, Vietnam, the Philippines and other inexpensive IT outsourcing destinations To set up working hours.

Today Ukraine International Airlines offers regular direct flights from Kiev to New York from 488 euros. In this way, Ukrainian developers can easily reach their American colleagues and regular business trips can take place.

In addition, the visa exemption between Ukraine and the EU, introduced in 2017, has made traveling to customers in the EU even easier.

IT outsourcing: Regular direct flights from Kiev to major European technology centers

12. Only 11 statutory paid holidays

There are only 11 generally recognized public holidays in Ukraine. While in other Eastern European countries like the Czech Republic, Poland, Romania and Hungary there are at least 13 paid public holidays and in Bulgaria there are even 19 days.

Swell:

  1. Ukraine Digital News and AVentures, IT Ukraine: IT services and software R&D in Europe’s rising tech nation.
  2. DOU.UA, Programming language popularity ranking, February 2020.
  3. Daxx, How Many Developers Are There in Ukraine, Really? 2020.
  4. Including all the country’s higher education institutions and scientific research institutions. Source: Ministry of Education of Ukraine.
  5. The 2017 Global Outsourcing 100® by IOAP.
  6. Techstars, 540+ VCs, and € 23.8B in the Last Two Years, September 2016.
  7. Which country has the most Java, JavaScript, Ruby on Rails, Python and PHP developers? January 2020
  8. Out of 190 countries. Source: World Bank, Doing Business 2017, June 2016.