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Significant up-front costs
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It is often considered that captive operations require significant initial investment. ITT Nearshore Sourcing manages to set up captive centers with little to no up-front costs incurred by partner. In most cases the initial investment is limited to EUR 3.000-6.000. It is also possible to negotiate a model with no or shared up-front costs. |
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Salary inflation over time
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While salaries of IT professionals are on the rise, they will remain significantly lower than those offered for comparable work in Europe. Relatively lower cost of living compared to EU member-states is expected to keep salaries of Ukrainian software developers competitive. |
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Scalability of workforce and infrastructure
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IIT Nearshore Sourcing develops and follows well-structured and effective strategy for hiring and retaining employees that addresses training, career development, job satisfaction along with compensation and benefits. We also ensure opportunities for career growth paths, international and management experience to retain higher-value employees. Both rent and purchase of office space and infrastructure are highly affordable and thus their scalability is easily accomplished. |
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Intellectual property and data security
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Captive model ensures maximum possible mitigation of intellectual property risks. Staff continuity and transfer of ownership guarantee full IP capture, improved data security and retention of business-specific knowledge. |
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Lack of adequate management bandwidth to effectively manage captive operations
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With more than 5 years of experience in successful management of local operations that deliver software services to European customers, we apply proven practices and know-how to make teams highly efficient:
- Invest in leaders with strong remote delivery management and problem-solving skills
- Manage expectations of all stakeholders on the ongoing basis
- Ensure that project managers act as effective liaisons between in-house and captive teams
- Elaborate well-structured governance framework (clearly defined roles and responsibilities, accountability, communication structure for disclosure and feedback, issue-escalation procedures)
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Alignment of nearshore team with parent organization’s culture and business imperatives
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We recommend the following measures to be taken by the customer organization in order to minimize related risks:
- Determine to what extent should parent organizations culture be mirrored in captive center
- Clear communication of expectations from on-going relationships
- Establish a captive center around long-term vision and business strategy rather then short-term goals
- Onsite training for initial captive operations team
- Regular visits to nearshore facility
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Political risks, government regulations
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Ukrainian authorities do not impose specific regulations on IT business. Understanding global economy perspectives, government declares support for Information Technology sector and facilitates the development of SMEs. That’s why political risks do not directly influence most of the SMEs, especially in IT industry.
By leveraging its local expertise IIT Nearshore Services takes full responsibility for dealing with peculiarities of doing business in Ukraine, government regulations and other legal issues. |
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Process challenges
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IIT Nearshore Sourcing provides active assistance in setup or replication of customer organization’s processes and pays utmost attention to optimizing infrastructure and technology at the captive center. |
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