Eastern Europe is one of the most popular destinations to outsource information technology (IT) projects – particularly Poland, Ukraine, Romania, and Bulgaria. Businesses in Nordic countries often choose software developers from this region for their talent and good value for low prices.
But what do you need to know before choosing to work with IT professionals from any of the countries on this list?
Let’s unpack this question by comparing two of the most popular countries for IT nearshoring, Poland, and Ukraine.
As of 2018, Poland’s total IT market value was estimated to be $18 billion and the forecast for 2023 is $27.5 billion respectively (Export Portal). The market is growing significantly each year and currently accounts for 3.3% of Polish gross domestic product. And it is only expected to continue growing as the European Union continues to finance technological investments.
The main reason why Poland’s IT market is becoming increasingly valuable is the availability of employees; 30,000 IT graduates enter the market each year while 99,500 high school students enroll in specialized IT courses. They are also proving themselves in international programming competitions, such as The International Olympiad in Informatics, Capture the Flag, and the ACM International Collegiate Programming Contest.
What’s more, despite their high-quality outputs, labor costs in Poland are between 20-50% lower than those in Western Europe.
As a growing rival, Ukraine is seeing significant growth in the IT sector. The country possesses over 185,000 IT professionals who are working within over 4,000 tech companies, making the technology sector the country’s second export industry as of 2018. Punctuating the point, over 100 of the Fortune 500 companies use Ukrainian IT services.
According to UNIT.City’s 2019 guide, IT services in Ukraine were estimated to account for $5.4 billion last year and are projected to rise to $8.4 billion by 2025. The biggest IT cities in Ukraine are Lviv, Kharkiv, and Kyiv.
In terms of culture and communication skills, English-speaking professionals are equally comfortable nearshoring to Poland and Ukraine. It is worth pointing out, however, that the English Proficiency Index in Poland is 63.76 and 52.13 in Ukraine, ranked 9th and 29th in Europe respectively. The latter has fallen 22 places in the past 7 years. Poles are also more heavy Internet users than Ukrainians; the numbers are 76% and 53% respectively.
That being said, you are unlikely to face cultural differences that disrupt workflow with any partner in Eastern Europe. However, you may encounter better English proficiency with Polish team members.
Since Ukraine is not a member of the EU, issues may arise on general data protection regulations (GDPR) and intellectual property (IP) rights.
If your partner is from outside the EU, you have to be sure that they know how to process all the personal data. Otherwise, you might end up paying massive amounts of fines because your partner violated the rules.
The other part you need to think about is your IP. Countries outside the EU usually have lower intellectual property rights protection by local laws. If your product is protected by Intellectual property rights, then you should be aware of how the IP is protected in the location of your outsourcing partner and how transparent is the local court system. In case of low protection against IP infringements, you won’t be safeguarded in the case if your local software development vendor uses someone else’s code under IP or copyrights.
Would you be willing to start a court battle to protect your IP in Ukraine? Apart from the fact that one has to consider the political and economic risks, there are still hostilities in this region.
While Poland and Ukraine are evenly matched in most of the areas that matter for nearshoring, Poland has a range of added benefits:
Information technology outsourcing is on the rise, and Poland is among the most strategic locations for this.
If you’re looking to outsource your IT projects, our representatives at Netcorp are here to help. We have access to incredibly affordable, highly professional developers from Poland and Ukraine to address all of your software needs. Let us help you to drive your next IT project to success by hiring a dedicated development team in Poland.
Contact us at info@netcorp.ee and we’ll work with you to find the perfect developer for your IT project.
