Mixed News for Russia's Outsourcing Industry

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It's mixed news for Russia's outsourcing industry, based on comments from a Gartner analyst in a silicon.com article.

While its outsourcing market is growing at a healthy annual clip of 10 percent, and Gartner lists the country in its top 10 near-shore outsourcing locations, the analyst says that it could take "years" for Russia to overcome a public perception that it is a difficult place to conduct business. For instance, the analyst notes, it's tough to establish a captive operation in Russia.

Arkadiy Dobkin, CEO of Russian outsourcing provider EPAM Systems, says in an interview with IT Business Edge that Russian companies until recently had been challenged by "low governmental support," which made it tough for the country to compete on equal terms with India. But that is beginning to change, he says, leading to the strong growth noted by Gartner.

One of Russia's biggest strengths, according to both Dobkin and the silicon.com article, is an educational system that stresses science and mathematics and thus produces large numbers of engineers and other highly skilled grads.

Dobkin told us that Russian firms invest heavily in employee training and development and have yet to experience the attrition problems that have been well documented in India.

At least one Russian firm, Luxoft, was able to overcome any perceived challenges. It earned top honors in the product engineering category in the latest edition of the Big Black Book of Outsourcing, produced annually by Brown & Wilson Group. Luxoft has also received a number of other recent awards, which are detailed in this press release.