The IT sphere in Ukraine has been developing rapidly throughout the past decade. Ukraine’s introduction into the international world of IT began with foreign companies taking advantage of its developing economy and a great talent pool through outstaffing (hiring individuals to work remotely) and outsourcing (hiring a company to develop solutions based on particular requirements). The number of companies and their size significantly grew and so did the number of developers in the country.
Later R&D (research and development) offices appeared as a way to best utilize the Ukrainian talents by setting up a permanent location, fostering cooperation between western clients and Ukrainian minds. Rather than simply developing a software need for whatever company hires them, R&D offices are a major and fixed part of the company itself. Usually, they have all kinds of developers, business analysts, designers, marketing teams, etc.
Despite the growth of R&D offices, currently, the majority of Ukrainian IT companies are those who use the outsourcing model. There’s quite a big difference between these two types, particularly for developers. If you’re on the lookout for a new job or career and don’t quite know where to go or what the key differences are, then read on. Three Clearmovers with experience in both types of companies told us the differences you can expect.
Involvement
“Working in a product company is way more interesting as you can watch the project from the very beginning – how it is being created, changed, how it grows and adapts to new requirements,” says Viktoria Levchuk, our Junior Software Engineer. “The developers are writing their codes as well as possible because later they will need to work with it. Whereas in outsourcing the terms are short and everything is made in the way that you write the functionality quickly and give it away to the client”.
It seems generally agreed that in product companies you have a wonderful opportunity to see the product grow and take part in it at every level, and continue to see how it is received. While of course, it may be easier to work in more experienced outsourcing companies due to their years of knowledge, if you’re looking for a sense of personal purpose, you’re less likely to find it there. You tend to have more attachment as it is a core part of the company as a whole. Whereas working on a short-term project in an outsourcing company doesn’t quite give you the same sense of involvement, as today you are working on one project and tomorrow your line manager put you on another one.
Myroslav Gavryshchuk, our Product Manager, says “Developers can be thrown from one project to another, so their engagement can decrease as a result. In an ideal world, in a product company, everyone works on one particular product, everyone knows what they are doing, and can offer ideas.” By the way, if you want to find out more about our Product Manager Myroslav, you can find his interview here.
Communication
“In outsourcing companies, all the decisions about what should be implemented are made by the client. So the development team is mostly responsible for the quality of the end product” continues Myroslav Gavryshchuk. “In product companies, development and business are in the same boat. We are responsible for not only the workability of a particular feature but also whether it is needed at all.
Andrii Ivaniv, our Senior Software Engineer, adds “Communication is generally better in product companies as there’s no middleman to mess up”.
Salary
Salaries always depend on the particular company and your seniority. There are some long-standing companies in Ukraine who have been outsourcing for a long time, with great salaries and some new startup product companies with lower salaries. Although start-ups may offer you more opportunities to get experience and seniority due to their smaller offices. Also, consider the following:
“No middleman means that a developer receives a bigger salary compared to those who work for outsourcing,” says Andrii Ivaniv.
Indeed, outsourcing companies often have more levels between you and the client, which means you will receive a smaller compensation as a result, compared to the product one.
Responsibility and wider field for experiments
We touched on this in the last point, but it is a vital point of its own. When you are in a product company, with a smaller chain of command, you will most likely get more experience and more responsibility. Of course, this may not appeal to you and seem risky, but to achieve personal growth this can only be done with responsibility.
“The responsibility for the result allows quicker growth and opens more opportunities for experimentation. In outsourcing, it’s hard to push your ideas further due to a long bureaucratic chain. In a product company, a developer can come to the stakeholder directly and offer to implement some features. In outsourcing he needs to go to Business Analyst, who then goes to the product owner who needs to confirm with the Product Manager, etc.” says Myroslav Gavryshchuk.
Additionally, when you are in a product development company and have more responsibility for your own choices, you are free to experience, take risks, give new ideas. Whereas outsourcing companies are under direct orders from their clients overseas. If you want to turn up, be told what to do, then outsourcing is probably better, but if you prefer risk, choice, freedom, then product companies are a better fit.
While it is obvious from this article that we support product companies as we are one, it is important to think critically. There are dozens of wonderful outsourcing companies out there that have good management, pay well, and are generally successful. As well there are less reputable product companies with low salaries and no growth opportunities. However, when the conditions are the same or similar you now know what essential differences exist when it comes to working. Hopefully, this will help you to make the right choice.
If you share Clearmove’s values and are willing to try out working in a cutting edge product company together with Vika, Andrii, and Myroslav – press the button below to let us know.