In the last five years Russia has put itself firmly on the outsourcing map, with many analysts believing that competitive edges like its strong educational and training tradition, hosts of software engineers with excellent backgrounds in mathematics and geographical and cultural proximity to key markets, is going to make it a fierce contender.
This is according to Peter Denny, a director IT training company, IT Intellect.
Denny saya another country "heading up the outsourcing mountain" is China.
"The rise of Russia and China as outsourcing destinations gives companies more choice, and greater access to cheaper labour costs provided by those economies. South Africa, however, is still in a position to compete. Our labour costs might be higher than countries like India, China and Russia, but our geographical position, expertise and the fact that we are an economy based on the English language, means that Western Europe and America companies often look upon us favourably.
"However, unlike Russia – which boasts a veritable mine of software engineers and IT workers – South Africa desperately needs more skilled IT workers. This is one of the biggest challenges we face."
Denny says Russian software development companies have been adding tremendous value to clients worldwide, while Russian software products often define the cutting edge in various segments of the software market – such as anti-viral protection or digital signal processing and voice recognition.
"It would be a mistake to regard China and Russia as being behind in the technology world – that they can only service the bottom end of the outsourcing and software development market. This is far from the truth. It is likely that they have better expertise than many countries, including South Africa.
"If we are to remain competitive we are going to have to focus more on education and training, and we are going to have to empower more people – especially previously disadvantaged individuals – to enter the IT mainstream. It is critical – and it is not something we can address in five years' time. government and the private sector need to address it now."