Faces of the Industry

Professor, SPbSTU; President, XJ Technologies
President, Transas Group
Co-founder, Yandex
Operations Director, Intel
President, National Computer Corporation; President, Aquarius Group; Board Member, Systematica Group
Senior Partner and Investment Advisor, Runa Capital; Chairman of the Board of Directors, Parallels
CEO, Hewlett-Packard Russia
CEO, InfoWatch Group of Companies; Co-founder, Kaspersky Lab
Co-Founder, ScrumTrek; Founder, AgileRussia
President, FORS
President, Borlas Consulting Group
General Director of Russian Venture Company (RSC); Member of the Presidential Commission for Modernization and Technological Development of the Russian Economy (MER)
General Manager, IBM Russia & CIS
Vice President, Head of Point of Production, T-Systems CIS
Founder & CEO, yaM Labs; Founder & Director, invisibleCRM
President and Founder, Spirit DSP
General Manager, I.T. Co.
CEO and President, EPAM Systems
Founder & Chairman of the Board, ABBYY
CEO & Co-Founder, Kaspersky Lab
Professor, Moscow State University
Chief Executive Officer, Artezio
Director General, CROC
Associate Member of the Russian Academy of Sciences, Professor, Dr. Sci. (Phys.–Math.); Director of the Institute of System Programming
Founder and CEO, SoftJoys
President and Founder, Auriga
President, RUSSOFT
Director General, TERCOM and LANIT-TERCOM; Director, Institute of Information Technologies; Head of System Programming, St. Petersburg State University
President & Chief Executive Officer, Luxoft

Why Russia

  • Native talent and education system
    • Quality vs. quantity: while India and China have vastly more people, Russian programmers are on average significantly better educated and trained
    • Russian educational system is traditionally strong in fundamental sciences and math, leading to Russian programmers being well trained in problem solving and algorithmic thinking
    • Russian labor market is far more stable than Indian, leading to very low personnel attrition rates (below 10% annually vs. 20-25% or higher in India)
  • Cultural fit and work ethic
    • Russians are much closer culturally to the US than Indians or Chinese
    • Honest communication and constructive pushback vs. “yes men”
    • Culturally, it is more difficult for people in India and China to “go against authority” and take initiative, therefore both locations suffer from lack of competent middle managers
  • Relative ease and cost of travel
  • Special visa regime for US citizens which allows stays of up to six months at a time; no "letter of invitation" required
  • Better time zone overlap (4-5 hours due to later office hours used by Russian partners)
  • Cost of doing business in Russia is a fraction of that in the US
  • Labor costs for similarly trained programmers up to 70% les than in the US or EU
  • Broadband connectivity and premium office space is affordable and abundant
  • Better IPR protection (especially as compared to China)
  • Government support for the industry in the form of tax incentives and a country-wide network of innovation centers

Captive R&D centers

Research and development (R&D) centers owned by foreign multinational companies first began to appear in Russia in the 1990s with Debis (now T-Systems) opening in 1995, followed by Intel and Deutsche Bank in 2001, and Oracle (which now incorporates Sun Microsystems) in 2004. The trend continues with new R&D centers…

Independent Software Vendors

An ISV (independent software vendor) develops and sells its own software products and ready-made solutions on both the Russian domestic market and for export. It’s difficult to estimate the total revenue of Russian software vendors…

Doing IT business in Russia

IT hubs (cities)

The majority of Russia’s export-oriented outsourcers are located in the country’s major cities: Moscow, St. Petersburg, Novosibirsk, and Nizhny Novgorod. According to the RUSSOFT survey, Novosibirsk, Voronezh, Rostov-on-Don, Veliky Novgorod and Kazan are among the top ten Russian software development destinations…

Regulatory climate

Since Russia’s emergence as a market-based and globally integrated economy, the country has been successful in enacting rational legislation and creating commercial and institutional structures that favor the implementation of software outsourcing agreements that are binding and enforceable, and allowing it software outsourcing to grow and operate efficiently…

Labor laws

Russian labor law, while adhering international standards in most key areas, differs from EU and US law in significant ways that may increase the burdens placed upon an employer. While the letter of the law is extremely exacting, in practice there are many ways in which employers can and do get around the laws. Not only is there a difference in the way that the laws are laid out…

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