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Why outsource to Russia
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 Why You Should Outsource to Russia?
- According to Earthweb sources, the global IT outsourcing market exceeded $68 billion in 2002 and will reach $100 billion in 2007. The most dynamically developing players are third-world countries (China, Brazil, Mexico) along with Russia, Ukraine, and Belarus. The Russian market is expected to reach $650 million in 2004 with continuous annual growth of 15-20%.
- Compared to their competitors, Russia and the CIS countries have a higher level of education and a more innovative approach. While Indian programmers mainly handle programming jobs, the Slavs are able to develop solutions for complex high-tech problems. Russian specialists have experience in working on large-scale projects in the areas of space, power engineering, cybernetics, armaments, etc. Furthermore, the culture of Russia is closer to that of Western countries.
At the same time, after visiting Russia a lot of foreigners acknowledge that the country’s reputation in the world is much worse than the reality. This is also the case for the IT industry – Russian programmers normally outperform their customers’ expectations.
- Some important outsourcing trends
- Drop in the prestige of IT departments at US universities. This tendency is accompanied by a drop in the quality of math education. In Russia there is a reverse trend with stable growth of the internal IT market. The number of IT graduates remains unchanged, while the quality of education increases, and university curricula are updated with new technologies.
- Activation of American IT consulting firms managed by former Russian citizens.
In view of Russia’s growth in the global IT market, immigrants from the former Soviet Union see more and more benefits in working with remote development teams from Russia. In 2004 only, ContekSoft was contacted by more than ten consulting companies of this kind from the USA and Canada. The result has been the creation of a group of Tomsk software companies with a representative in Philadelphia (http://www.tomita-software.com) and the signing of a partnership agreement with SciTech Concept Corp (http://scitechconcept.com).
- Outsourcing of more complex jobs than before including BPO, call centers, data processing centers, etc.
- Keys to the successful selection of an outsourcing partner
- If you demand business maturity from your prospective partner, analyze your own business from this viewpoint. Are you ready to define project metrics, document project procedures, and ensure documented acceptance of deliverables? If the answer is yes, demand the same from your partner. The partnership will hardly be successful if both parties occupy the same low level of business maturity.
- Do not choose a partner solely based on price. All businesses work for profit. If the price is too low, the behavior of the partner can hardly be predicted. They may either employ students or simply deceive you.
- Do not just look at your partner’s current capability – look at their ability for future growth.
- If you are looking for a strategic partner, make sure they are looking for a strategic partner too. Otherwise, the proposals of one party will never meet the expectations of the other
- Outsourcing tips
- Start with a pilot project. It is the best way to test your future partner. The pilot project should be demonstrative of your future partnership strategy. A good sign of maturity is completing the pilot project at a reduced price or free of charge.
- Share the risk. You should do this both from the perspective of reward and recognition and from the perspective of remuneration. Russian programmers are known for their ability to exceed customer’s expectations. Include detailed metrics of success in the contract together with corresponding bonuses/penalties.
- Clearly document in the contract the possibility to modify prices and project conditions during the project
- Remember that building a partnership demands time. Spend plenty of time on building partnership relations, otherwise your prospective partner may think your intentions are not long-term.
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