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HOW TO DO
IT OUTSOURCING RIGHT
AND BE SMART ABOUT IT
What is IT outsourcing?
IT outsourcing is the use of external service providers to effectively deliver IT-enabled business
...
Is there any difference?
Onshore Nearshore Offshore to CEE
■ Same language
■ Quick on-demand meetings
■ Modest travel expens...
CEE locations & How to get there
75,000UA
53,000BY
18,000BG
80,000HU
65,000RO
63,000CZ
162,000PL
ITC industry size, 

peop...
What to expect from CEE IT companies
■ 100% fit to US and Western Europe business culture
■ Project rates are roughly betwe...
Technology stack in CEE
Source: dou.ua, dev.by
Technologies in use
Technology stack in CEE
Source: dou.ua, dev.by
Professional satisfaction by technology
How to find a tech partner in CEE
Most common types of companies
■ global locations across CEE
■ U.S. and Western Europe presence
Enterprise level providers...
Organization readiness checklist
■ Do you have a clearly defined reason for outsourcing?
■ Is your company prepared for out...
Partner selection checklist
■ Do they have positive track records?
■ Do they have positive references?
■ Do they have the ...
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How to Do IT Outsourcing Right and Be Smart About It

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This presentation explains the difference between IT outsourcing destinations and introduces Central Eastern Europe locations, outsourcing companies by volume and their benefits, and gives the tips on how to prepare for outsourcing and do it right.

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How to Do IT Outsourcing Right and Be Smart About It

  1. 1. HOW TO DO IT OUTSOURCING RIGHT AND BE SMART ABOUT IT
  2. 2. What is IT outsourcing? IT outsourcing is the use of external service providers to effectively deliver IT-enabled business process, application service and infrastructure solutions for business outcomes. www.gartner.com/it-glossary/it-outsourcing/ Onshore External teams in your country. Nearshore External teams in adjacent time zones, probably 2 - 3 hours ahead of you, 5 - 6 hours of flight.
 In some countries there is no need for an entry visa for US citizen. English is not a native language, but widely used in professional circles. Offshore - CEE External teams from the European region, 9 - 11 hours ahead of you, 8 - 9 hours of flight. Visa-free entry for US citizen to all CEE countries, except for Russia. English is not a native language, but widely used in professional circles.
  3. 3. Is there any difference? Onshore Nearshore Offshore to CEE ■ Same language ■ Quick on-demand meetings ■ Modest travel expenses ■ Rates are lower ■ A “global” business day is 2 - 3 hours longer ■ You can access a wider talent pool ■ Talent shortage ■ Local rates ■ Where are their developers? Reasons to work locally What to consider ■ Higher travel expenses ■ Lack of face to face communication ■ More project documentation required ■ Virtual stand up meetings What to consider ■ Rates are lower ■ A “global” business day is 8 - 11 hours longer ■ You can access a wider talent pool ■ Higher travel expenses ■ Lack of face to face communication ■ More project documentation required ■ Virtual stand up meetings ■ Longer business hours required ■ Considerably more online communication What to consider Reasons to outsource Reasons to outsource
  4. 4. CEE locations & How to get there 75,000UA 53,000BY 18,000BG 80,000HU 65,000RO 63,000CZ 162,000PL ITC industry size, 
 people
  5. 5. What to expect from CEE IT companies ■ 100% fit to US and Western Europe business culture ■ Project rates are roughly between $15 and $55 per hour; up to 20% discount on rates for 6+ months assignments ■ English is the primary language for business communication ■ Established CEE IT companies have development offices across the region to maximize access to talent pool ■ Engagement models are fixed price, T&M as well as dedicated teams ■ Proactivity. They will challenge any technical brief to make sure it describes an optimal solution. ■ IT companies formed IT associations within each CEE country as well as global associations to lobby industry interests ■ IT industry faces strong government support and tax reductions in many CEE locations to boost the industry growth
  6. 6. Technology stack in CEE Source: dou.ua, dev.by Technologies in use
  7. 7. Technology stack in CEE Source: dou.ua, dev.by Professional satisfaction by technology
  8. 8. How to find a tech partner in CEE
  9. 9. Most common types of companies ■ global locations across CEE ■ U.S. and Western Europe presence Enterprise level providers Boutique agencies Bottom feeders Expected rates $30 … $55 $25 … $40 $15 … $25 Stable but sometimes not flexible enough to work with SMB ■ 500+ employees ■ 10+ years in business ■ representative offices in the U.S. ■ process oriented, focus strong quality control ■ deliver on time and budget Great choice for SMB, but charge higher rates in exchange for a deep understanding of a business niche ■ 15 to 100 FTEs ■ strong industry and domain expertise ■ diverse technology stacks ■ no representation in US ■ no business continuity plans ■ roughly 0 - 3 years of experience Risky ground at low rate, often with unrealistic deadlines ■ undocumented processes, no quality control ■ project deliveries are not guaranteed
  10. 10. Organization readiness checklist ■ Do you have a clearly defined reason for outsourcing? ■ Is your company prepared for outsourcing? ■ Are you personally ready to work longer hours or off-hours? ■ Have you decided on an outsourcing location? ■ Have you decided on an outsourcing business model? ■ Do you have time and budget to travel to your preferred or key outsourcing location?
  11. 11. Partner selection checklist ■ Do they have positive track records? ■ Do they have positive references? ■ Do they have the right technology expertise? ■ Do they show a long-term partnership approach? ■ Are they ready for a full vested involvement in the project development as your business partner, not just as a third party developer? ■ Are they flexible enough to work under your processes? NB: sometimes you need to be flexible and adopt the best practices, tools, and processes from their side.
  12. 12. TITLE TEXT bit.ly/SmartSourcingSF-FB We will be happy to continue this conversation in Twitter #SmartSourcingSF and our LinkedIn group https://goo.gl/Dt7nWY.

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