Outsourcing to Russia: Stereotypes and Benefits

outsourcing to russia
Category: Stories Post Date: 25.10.2019

When considering outsourcing to Russia, you should try gathering as much information as possible to make the right decision. While many foreign companies already benefit from working with Russian developers, there are just as many business owners who are afraid based on stereotypes about Russia.

Being the largest country in the world by territory, it comes as no surprise that this controversial and often misunderstood country is also among the world’s TOP outsourcing providers. Let’s discuss the key points of cooperation with Russian companies, and find out why outsourcing to Russia can be beneficial for your business.

Offshore Software Development in Russia: General Market Overview

Let’s review the general market of software development in Russia, its potential and main specifics.

The Background of Russian Technical Achievements

To find the roots of Russian specialists’ extensive IT achievements, we should look back at the USSR times. When the Cold War was waged between the Soviets and the US. Back in those times, industries that require serious technical education (such as nuclear energy, aviation, cosmonautics, computer technologies) were developing rapidly.

Throughout 30 years (from 1950 to the 1980s), 7 USSR scientists received Nobel Prizes in physics, chemistry, and economics. Moreover, in 1950, the first Soviet electronic computer was launched, serving as a pioneer of the modern PC format. The power industry and computing methods were at the peak of its development as well.

All those factors had a huge impact on Russians’ mentality. As well as on the educational sector. After the collapse of the USSR, most universities received an inheritance of a huge number of computers. It was obligatory for Russian students to have at least a semester of computer studies and engineering (even for those who’d chosen different majors).

Potential of the Russian IT Industry

Today, Russia is a well-known progressive IT solutions provider. For example, Telegram messenger is known worldwide as a super-secure communication platform.

Considering the IT industry potential in Russia, the Ministry of Education and Science of the Russian Federation focused its efforts to stimulate the growth of highly-qualified programmers in the country. The vast majority of technical high education establishments throughout Russia have shown a rapid increase in the number of IT faculties.

Dozens of IT divisions and related scientific research centers have appeared in the country. The main idea was to raise up technically-savvy youth in Russia. Such a small tweak to the approach towards the educational system has shown outstanding results. Future IT Experts now get lots of government support and motivation. It’s become prestigious to gain a profession of an IT specialist in Russia.

Offshore IT Development in Russia

While many companies are primarily interested in developing programming solutions for local needs, numerous Russian IT companies readily provide services for foreign clients. The Russian offshore IT development sector is rapidly growing and bringing in strong revenue to the government budget. This makes it a win-win for both the government and software development companies.

The country’s government strives to create the most appropriate legislative base for Russian outsourcing companies, as well as for foreign investors. Offshore companies in Russia get favorable tax laws. This allows them to provide foreign customers with reasonable and competitive pricing for high-quality IT services. That’s why Russia takes 4th place in Europe for the number of IT professionals.

professional developers statistics

The Russian government achieved impressive results in elevating the Russian IT sector to the next level. An end-to-end approach to the organization of IT business relationships between Russian offshore developers and foreign customers does its best. Russian government that supports IT development from one end, and IT companies that provide high-quality services from another end, together create full-cycle activities for foreign investment attraction in the IT industry.

Despite quite a controversial political image of the country, Russian developers are valued highly in the global IT market. For instance – in 2018, the IT outsourcing market in Russia totaled a colossal 6.8 billion Euros, which is a decent indication of this business model’s success.

Benefits of Working With Russian Development Companies

What kind of benefits do customers receive when working with Russian development companies?

Acceptable pricing policies

An optimal offshoring opportunity means that you get highly-qualified IT experts operating outside your country at a low cost. To compare, the average rate for programmers based in Germany is about 70-100 Euros per man-hour, whereas offshore software development in Russia will cost you about 30-35 Euros per man-hour (over 50% less).

Such an amazing price/quality ratio is possible because of the lower cost of living in the country and doesn’t affect the quality of IT services delivered in Russia. The benefits of outsourcing to Russia are not limited to that, however.

At i-Neti, thanks to a primarily remote-based offshore development workflow, we quite frequently hire experts from regions (instead of focusing exclusively on metropolitan areas). This allows us to offer clients even lower prices than other Russian offshore outsourcing companies that have R&D offices in big cities only. What we ultimately get from this approach is the ability to provide competitive rates at no expense to our team of experts’ salaries.

Mathematical Background

As mentioned above, Russian IT developers get very good technical training at higher education facilities. Many Russian students participate in maths and computer science competitions boasting progressive projects.

As for i-Neti, our aim is to bring together some of the brightest minds educated at top technical Russian universities. Thus, apart from excellent IT expertise, our developers also have in-depth knowledge of calculus, mathematical analysis, statistics, and other related subjects. This is necessary when you want to create high-quality complex software solutions.

In addition to that, Innopolis (Russia’s equivalent of Silicon Valley) is situated not far from the i-Neti office in Kazan. Our employees are quite frequent visitors to various conferences and competitions there (such as a Russian Robot Olympiad). Back in 2013, the Russian nation was recognized as one of the most highly-educated countries in the world.

Russian developers

Stable Teams

Developers from India, Mexico, and other countries with a lower standard of living tend to frequently migrate abroad. Even Ukrainian and Polish residents migrate to European countries in search of higher living standards.

In Russia, the situation is vice versa. Due to the mentality, patriotism, higher living standards (when compared to former USSR countries), and huge territory, internal migration is more frequent here. For this reason, customers may be confident that they’ll work with one and the same team when they sign with a Russian offshore development company.

Convenient Geographical Location

The territory of Russia covers 11 time zones. i-Neti employees, for instance, are well-suited to working remotely. Therefore, it is possible for i-Neti to work in almost any time zone that is convenient for a customer.

The fact that we have 11 time zones is a bonus, specifically because we don’t really have to adjust – we are already working in the time zone of most customers. Additionally, we may shift our working hours if there is a specific need. This can be achieved through a mutual agreement between a customer and a specific developer.

We regularly connect and interact with over 200 developers, 90% of which work from home or co-working locations. When customers have urgent questions, they can directly contact a project manager, technical consultant or developer via Skype, email or any other communication channel that customers choose.

Client Focus

It is very important for us at i-Neti that we always make cooperation convenient for our customers. Working in their time zones, we also adapt to every management style that our customers prefer. At i-Neti, we care about soft-skills as well as about hard-skills. Therefore IT specialists in our company are friendly, easy to work with and always willing to go the extra mile for our clients.

This allows i-Neti to provide the highest standards of cooperation with foreign customers. If our developers need to adapt to a new workflow, processes or study a new communication platform to satisfy particular customer requirements, there won’t be any issues.

Long-Term Cooperation

Despite sanctions, Russia has been able to maintain a stable economy. And we can already see a positive effect from that in the imports phase-out, which reinforces the stability of the economic situation even further. When outsourcing IT services to i-Neti, you can be sure about the safety of your investments and stable long-term cooperation.

Outsourcing to Russia: Stereotypes vs. Reality

When considering outsourcing in Russia, you may face some stereotypes around it. Yet, not all of them are real. However, it’s a good idea to find out some regional specifics to know how to plan your cooperation with a development company.

Russia as an outsourcing location

TOP 4 Stereotypes about Russian Developers 

There is quite a big number of stereotypes that concern Russia and its developers in particular. We’d like to name 4 main cliches.

Stereotype #1: Russians are bad at English

Reality: Foreigners visiting Russia often note that the majority of local people don’t speak English or have a very low level of the language. However, the problem is exaggerated. When it comes to IT specialists, to become experts at any technology, they should know English on at least an intermediate level. This allows them to read technical documentation/literature and listen to specific podcasts to be able to learn and improve the technology they work with.

Every i-Neti developer that is qualified to work on foreign projects can read, write and speak English. Part of their job entails daily email correspondence and participating in calls with clients and their partners.

Not only developers, but all project managers and administrative staff are involved in foreign projects process an intermediate to the upper level of the English language.

Stereotype #2: There are too many holidays in Russia

Reality: This can hinder the final project release at times. However, that heavily depends on the particular company you choose to work with. At i-Neti, we always adapt to our customers’ desires and shift vacations according to deadlines.

Stereotype #3: There are too many hackers in Russia

Reality: Hackers can be found in any country of the world, and if we talk about the most hacker-intense places, the Russian Federation would barely make the list. Yet, to protect customer data, Russian IT companies have many tools and rules. At i-Neti, we always take customer data integrity and security seriously. All works performed in an IT project are done according to the law and NDA requirements.

Stereotype #4: There is no workflow transparency

Reality: When it comes to cooperation with a Russian offshore company, customers frequently have doubts about the fairness of work, estimations, and budgets. To stay impartial, we should admit that some companies with weak reputations may juggle with their estimations.

Yet there are some tools that allow you as a customer to check the real time spent on your project. Jira management system would probably be the best for time estimation. All i-Neti projects are tracked in Jira. We will gladly provide you with weekly and monthly reports, the number of hours spent on your project, and any other proof of the information you need. So you can have confidence in the correctness of forming and distributing the project budget.

Russian Headquarters of World-Known Companies

Some of the major names that have been professionally taking up outsourcing to Russia for some years now include IBM, Microsoft, Nissan, Mitsubishi Electric, Samsung, Intuitive Surgical, Honda, American Airlines, and lots of others. Such big names can definitely give additional proof that the Russian software development market is stable and highly-attractive.

Companies with HQ in Russia

Why Outsource to Russia: Summary

As you can see from the information above, IT outsourcing in Russia is quite a fruitful market. It is constantly developing, based on extensive knowledge and skills of talented experts. Convenient geographic location, lower rates and a large pool of technical experts make Russia one of the most attractive outsourcing locations.

In case you have some questions about Russia as an outsourcing location – do not hesitate to contact us. With many years of professional IT experience, we know the market well and will be glad to help you make a choice that’ll bring continuous value to your business.

Comment (1)

  • HIRING PEOPLES Reply

    If Companies don’t have expertise in a specific project or part of the project, they decide to outsources that part or project to the companies who are specialized experts in that field.

    Usually, I never comment on blogs but your article is so convincing that I never stop myself to say something about it. You’re doing a great job. Keep it up. Thanks for sharing a knowledgeable article. It takes a lot of time to write such a useful article. Keep it up.

    26.05.2020 at 09:48

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