IT Outsourcing in Eastern Europe: Complete Overview

Eastern Europe outsourcing has been becoming increasingly popular for the last time because of its good reputation. The most attractive hallmark is the work cost value. Due to the hourly rate, which is lower compared to Western Europe, Eastern offers lower work cost value without losses in product quality. Besides, a high level of education provides the appearance of talented specialists in many difficult IT areas, such as artificial intelligence, machine learning, blockchain, and others.

In this article, we will answer the most popular questions concerning outsourcing in Eastern Europe, its main benefits and challenges, and how to outsource successfully.

Eastern Europe offers a large number of advantages for software development outsourcing, which is why Western companies are increasingly choosing this region. Let’s discuss the key reasons why countries in Eastern Europe have become so popular for IT outsourcing.

You can find a very large number of IT specialists and software developers in Eastern European countries. This region is characterized by strong human resources and a developed educational system. Each year, numerous undergraduates in IT complete their courses. They are well-versed in different coding languages and IT instruments, allowing them to easily fit into the technology world that keeps changing with time.

Only in Poland can you choose from 400,000 IT developers, so you can imagine how many there are in the entire region. It remains the most popular outsourcing destination. Countries like Estonia, Ukraine, Hungary, and the Czech Republic, which are top IT outsourcing destinations, also contribute significantly to this talent pool, with universities and training programs dedicated to IT.

The cost of outsourcing to Eastern Europe is significantly lower than in Western Europe or the USA, which makes it extremely attractive for companies that want to keep their investments. Here are the main reasons this region offers low prices and high-quality services.

• Lower cost of living. The cost of living in many Eastern European countries is lower than in Western European countries or the USA, so hourly wages for software developers are much lower. As a result, software development companies in countries of Eastern Europe can keep overhead costs low, which means lower service prices for clients.
• Lower taxes. Countries with high taxes require more expenses. Many Eastern European governments offer favorable tax conditions for businesses, especially in the IT sector, compared to Western countries. Lower corporate taxes encourage local and foreign companies to operate in the region. It helps IT companies keep operating costs low, which also affects prices.
• High government support for the IT sector. Eastern European governments actively support the IT industry. They implement several initiatives to support the development of the IT sector, such as establishing technology parks and business centers. It helps IT companies to develop and hold prices competitively, making the region attractive for outsourcing.

There are a lot of cultural similarities between Eastern Europeans and Western Europeans. The cultural background helps to better understand common values and business etiquette. Because of this, they have a similar approach to working processes and cooperation. Moreover, cultural similarity promotes closer human interaction, positively impacting the result. Such connection encourages trust and openness, which are essential components for successful software development project management. This trust provides a more effective delegation of tasks and allows teams to work more efficiently.

Eastern Europe software development outsourcing offers you a large number of developers who are involved in complex and niche technologies such as Artificial Intelligence (AI), Machine Learning (ML), Blockchain smart contracts, and the Internet of Things (IoT). Also, Eastern European developers are famous for creative and innovative technology solutions, so developers can offer advanced ways to solve your problems and check trends in IT outsourcing. The demand for skilled software professionals makes them consistently progress.

Despite the lower development rates, the quality of services in the Eastern Europe outsourcing market is still high. IT outsourcing in Europe ensures good results for software development projects due to such factors:

• The dedication to continuous improvement and investment in training, education, and development.
• Possessing a high level of technical knowledge and flexibility of Eastern European developers, which makes them perfect partners in fast-moving and intricate projects.
• Fluency in English and cultural proximity to Western Europe will ease teamwork and ensure the success of project outcomes.

Partnering with Eastern European software vendors gives you a great pool of IT specialists who offer reliable technical solutions for your business ideas. Moreover, developers from Eastern Europe adhere to high-quality standards and ensure clients receive top-tier services.

We at Cleveroad prioritize mature quality management, proven by an ISO 9001 certificate, to meet the quality needs of your software.

Eastern European IT vendors offer a wide range of custom software development services, so you can find appropriate solutions for your needs. Whether you're a startup, a small or medium business, or a large enterprise, Eastern European software development outsourcing allows you to get high-quality IT services depending on your needs. For instance, we at Cleveroad provide on-demand IT services, including IT consulting services, mobile and web development, UI/UX design, Quality Assurance, DevOps, services, IT staff augmentation, etc. This wide range of services ensures that Eastern Europe outsourcing allows you to achieve your goals effectively.

There are many advantages to software development outsourcing in Eastern Europe. But like everything in our world, it has challenges you should be ready for. And now, we discuss possible obstacles you can face and explain how to overcome them:

If you are in the US and outsource a project to Eastern Europe, you may face a significant time-zone difference, which can complicate communication with your software provider. Scheduling meetings, synchronization of tasks, and reporting deadlines can become real challenges that complicate development project management.

Solution: To avoid this problem when working with Eastern Europe IT outsourcing companies, cooperate with a company that knows how to address time-zone differences and organize remote work efficiently. For instance, at Cleveroad, we arrange flexible meeting schedules so that every party involved can be present and be in contact throughout business hours. Moreover, we are constantly available on the Slack chat to answer any questions and solve critical issues anytime.

Here is what our client from Australia says about cooperation with Cleveroad on project of sports social network creation:

Monitoring the protection of project data and software security from a distance is difficult. Firstly, your intellectual property could be at risk of theft or accidental loss. Additionally, sharing project details or sensitive data online can expose you to vulnerabilities. Finally, partnering with a vendor with insufficiently protected infrastructure will increase the chances of unauthorized access and the project's integrity.

Solution: To cope with this challenge, it is essential to cooperate with reliable outsourcing partners like Cleveroad, who sign NDAs at the beginning of project discussions to protect your data. Moreover, we have an ISO 27001 certificate for security management based on confirmed policies and processes for solid data protection.

When working with outsourcing companies in Eastern Europe, you should remember that different countries have different laws regarding information security, and a vendor's unfamiliarity with the laws of your target country can lead to litigation. In turn, it forces additional costs and can cause a lot of inconveniences and even problems. Furthermore, if you have business in highly regulated domains, such as Healthcare, Logistics, or FinTech, you should make sure your software vendor creates a solution compliant with industry legislation. Overwise, you risk facing penalties and legal issues.

Solution: To evade legal problems, work with Eastern Europe IT outsourcing companies that are well aware of your country's and industry's regulatory requirements. For instance, Cleveroad strictly adheres to local and international regulations regarding contracts, intellectual property, and data privacy, including GDPR rules, PIPEDA, FDA, HIPAA requirements, PCI DSS compliance, etc.

You can face some project management problems when outsourcing Eastern Europe. First of all, virtual meetings may not be as effective as on-site meetings. Besides, the processes are not easy to trace, and the synchronization of schedules may be difficult. Furthermore, it may be difficult to measure performance, especially if there are no clear success measures or system reporting.

Solution: All of these can make the completion of tasks bulky and lower the quality of work. To avoid such problems, it is necessary to develop transparent standards and methods of controlling the quality of the tasks and have a structured project management.

At Cleveroad, we have an all-out project management office to oversee your projects and perform them on time, within the budget, and in line with your business requirements.

Although specialists from Eastern Europe speak English well, there may be difficulties in communicating technical topics and discussing terms that are in demand for software development. It leads to such problems:

• Even if specialists speak English well, differences in terminology can lead to misunderstandings. For example, the same terms can have different meanings in different contexts.
• An incorrect understanding of the questions and instructions can cause errors that require repeated work and increase the project's time.
• Difficulties in the transfer of feedback can lead to a misunderstanding of the requirements for improving the quality of work or correcting processes.

Solution: Such problems do not exist if you partner with it outsourcing company Eastern Europe where experts have a high level of knowledge of English. At Cleveroad, all our specialists are fluent in English, which allows us to communicate effectively both with the project manager and team members.

There are some details on how to make Eastern Europe software outsourcing successful. You should adhere to them if you want to get the most out of this cooperation. Let’s look at these details:

Your demands for the chosen vendor have to be understandable and exact. Even the best IT software engineers will work less productively and quality if they do not get enough precise requirements.

Explain in detail the reasons why your project is or will be in demand, what it should achieve, and any strategic objectives. By describing the specific problem the project solves or the value it adds to users, you allow the company to align its approach with your vision. Also, describe what the system must do and how it interacts with the user. Moreover, you should define your target platform - whether you plan to create a web solution, a native mobile app for iOS or Android, or a cross-platform application. Finally, you should share your desires for future product design with your outsourcing vendor.

To successfully outsource to Eastern Europe, it is crucial to choose a reliable software provider that will help you successfully implement your product. Here are the main points to consider when outsourcing to Eastern Europe to choose the right IT partner:

• Technical experience. It is necessary for any IT outsourcing company to have experience in the software development services you need.
• Industry-specific expertise. You should pay attention to your future partner's knowledge of industry-specific software development practices and requirements.
• Portfolio. The appropriate IT provider must have successfully delivered projects in your business domain and have the required technology and case studies.
• Talent pool. Check the vendor's ability to provide all the specialists you require for your software product development and the ability to provide a unchangeable team throughout the project.
• Project management approach. Check if they use modern project management methodologies (Agile SDLC, Scrum) and have a clear process for handling timelines, changes, and risks.
• Reputation and client reviews. Reliable reviews should indicate quality across projects. They show that the provider excels not just in specific types of projects but can maintain high standards across different requirements.

We have a lot of testimonials from satisfied customers, which you can see on our Clutch page. Here's what our UK client says about working with Cleveroad:

A crucial part of your cooperation with Eastern Europe IT outsourcing companies is fostering open communication. Here are some tips to help you establish transparent communication with the outsourced software development team:

Monitoring progress and providing feedback are important components of working within outsourcing software development to Eastern Europe. It is essential to ensure quality control by identifying potential issues early, which minimizes the risk of low-quality outcomes. It also guarantees that the outsourcing company adheres to the project schedule. In addition, regular monitoring enhances communication and ensures clear objectives and expectations.

To effectively monitor progress, it's crucial to consistently review progress reports, request updates, and provide timely feedback to tackle any issues early on. Besides, adjusting resources or timelines is essential for ensuring smooth delivery. This proactive approach keeps you aligned with the team and guarantees that the final product meets your expectations.

Cleveroad is a professional software development company headquartered in Central and Eastern Europe (CEE region). We have R&D centers in Estonia, Poland, Ukraine, the US, and Norway. Since 2011, we have been helping startups and businesses of all sizes adopt advanced technologies.

Our experts specialize in providing a wide range of IT services, including custom software development, managed IT services, legacy software modernization, and more. We have expertise in 9 business domains, including Healthcare, Logistics, FinTech, and others.

Cleveroad team helps startups, SMBs, and enterprises accomplish their goals and give a chance for their perspective ideas. Cleveroad in numbers:

• 12+ years on the market (since 2011)
• 250 in-house engineers
• 200 successful projects

We provide flexible outsourcing cooperation models for your software project:

Our IT staff augmentation services (or IT staff expansion) give you an opportunity to quickly get external specialists at the necessary technology and industry professional level on a temporary basis. You can increase your in-house team with the needed tech experts with a background in your business domain or hire a few specialists exclusively dedicated to your software product. By choosing IT staff augmentation, you can fully manage the project, contrary to the full outsourcing model, where our project manager does this part.

Dedicated development team services allow you to hand over the full software development process to a dedicated team that exclusively works on your product. We assemble a team that includes all the software development experts you need: a solution architect, QA and DevOps engineers, UI/UX designers, a project manager, or a business analyst. This group independently provides the agreed project and work scope and completely manages your software product creation. You need to pay for the time and resources spent on the project according to the specialist's hourly rates for development.

We have completed over 200 successful outsourcing projects. To learn more about them, you can check our portfolio.