There are countries that support the idea of the reduced working hours per week or working days in order to improve the life quality of their employees. One may ask how they manage to keep the same amount of output with reduced input. Outsourcing can be an answer.
Many companies of different sizes need to hire more people while growing. Yet, a growing business doesn’t exactly need a large workforce. It will result in high costs for internal expenses such as benefits administration, office space, utilities, equipment, and much more.
Outsourcing is a smart strategy that allows businesses to grow while cutting a few internal costs and tasks that would hurt the company’s budget and culture.
For many years big and small companies have outsourced various tasks to nearshore and offshore locations such as India, the Philippines, China, and Mexico due to the low cost of labor.
For many years, cost reduction has been the main reason why companies decided to outsource. However, factors such as the talent gap have are now driving businesses worldwide to new outsourcing markets.
The above-mentioned countries are starting to face competition. Eastern Europe is growing as an alternative market, especially for software development. There are several reasons why Eastern European countries are a good destination for outsourcing software development and other operations.
Given that lower costs appeal to businesses that are looking for new markets where to delegate their software development, let’s start with cost. It is a common trend that the companies that decide to outsource software or IT related services don’t rely completely on IT. Therefore they look for companies that can help them deliver services at an affordable cost. Software development companies in Eastern European countries have almost the same costs as companies in India and three times lower compared to the US or the UK.
Lower costs better quality
Countries in Eastern Europe rank among the top 20 countries for best developers in the world. Over one million people work in software development in the Central Eastern Europe region. This market appeals to companies located mostly in the UK, Netherlands, the US, France, Austria, and many others.
Eastern Europe has a high number of students that pursue Informatics and computer sciences programs of study. Moreover, there’s a high number of youngsters that study abroad. Another advantage of the education systems in Eastern Europe is related to foreign languages. There are many universities where computer sciences and informatics are in the English language. The fact that Business Process Outsourcing (BPO) has flourished in this part of Europe is proof of the multilingual workforce.
Rule of law and Safety
Most of the CEE countries are part of the European Union (EU). Meanwhile, countries like Albania have obtained the EU candidate status and since then have harmonized their legal frameworks with the EU. Therefore, companies operating in these countries are bound by BU laws or other data security and safety standards.
In the meantime, Ukraine is a great destination for software development, but the lack of political stability has an impact on the decisions of many companies for outsourcing there.
Cultural Affinity, location, and time zone
If there’s a bug in the code, it can be a big deal if the seller and vendor are located in different time-zones. CEE countries are about a two-hour flight distance from the other major EU capitals. Therefore, there’s no need to worry about long-distance travel in cases of important meetings. Location is also important for companies that plan to expand in new markets. At the same time, it is crucial for a great life-work balance. Happy employees are key to a high quality of deliverables.
The Western Balkan countries are the best destinations due to their Mediterranean climate and access to the Adriatic and Ionian seas. Moreover, cultural affinity avoids communication problems and misunderstandings. People living in Eastern Europe are open-minded.