Andrew Pavliv: IT city, business, and global competition

04 Apr, 2016

Profitable nearshoring-partner, but difficult to get to: this is how the international partners perceive Lviv.  Although they willingly choose the city among others, the lack of direct flights often plays against Lviv and local companies. Andrew Pavliv, CEO of N-iX, talks about the changes IT can bring, and the needs of the companies in the city. Read the exclusive interview for Lviv IT Cluster to find out what they are.

 “Business got more dynamic”

“We founded N-iX in 2002, when Lviv IT market was very different from the one we have now. There were no big companies, and the market had other players who are not here anymore,” says Andrew. At that time, SoftServe was less than five hundred workers, Eleks – even smaller, and the overall professionalism was lower than it is now.

N-iX, which started as a tech startup, has grown to three hundred employees and offices in three cities.

“In fourteen years, a lot has changed: we have got a lot of highly qualified professionals and interesting projects, and big players entered the local market,” continues Andrew. He adds: IT-sector got very dynamic, and more people are starting to work in it. Another change is the emergence of large companies which started out in the city, and now reached the international level. Currently, the city hosts around 200 IT companies, and over the past five years, the industry has grown three times. Now it employs more than 15,000 IT specialists and expects 5,000 graduates annually. If ten years ago, many programmers had no job after graduating university and worked in other areas, the situation is different now with many people switching from other fields to IT.

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In addition, experts have got more qualified and earn more, and constant development of the industry increased the competition for employees. Andrew is positive: the companies became more “mature” when it comes to cooperating with international partners, and provide their clients with more interesting services.

Market growth also led to some challenges because the companies have to compete at a much higher level. «Lviv IT market can be compared with the boxing group: in the beginning, there were only amateurs, but now, we have professional sportsmen, and a completely different competition,” says Andrew. The seriousness of clients increased the salaries of the specialists. “If in 2002, the price of Ukrainian IT-specialists was no different or even lower than in India, it is clear that we are more expensive now. So we have to compete using the talents of our people and the quality of services we provide,” he adds.

“We need to become global”

“We position ourselves as a Ukrainian and Eastern European company,” states Andrew. According to him, location is important in IT since many European customers are looking for nearshoring-partners: those with little time difference, and close geographically. Lviv companies can be such partners because locals work almost in the same hours as the people in Western Europe.

“The second factor – the simplicity to get here – needs more planes to the city and new routes,” says Andrew. In particular, it is necessary to truly implement the Open Sky Agreement and increase the competition between the airlines. The Western European clients should be able to reach the city in two or three hours nonstop on the right day; because now, getting to Lviv takes a lot of time and many connections.

“We had clients for whom we fought, but lost because of the inconvenience to get here. Multiple stops and high ticket price are weak factors when finding partners, and lack of flights to the city is perhaps the only negative aspect of working in the city. Lviv is a popular IT-center, but with more flights, it will be much more attractive to customers. This way, the competitiveness of Lviv companies will increase.”

Andrew advises companies to go beyond the city and convert from local to international. “With offices not only in Ukraine, we can better cooperate with the clients or find the right specialists. So I recommend local companies to become bigger and global as fast as they can,” CEO suggests. ”

“We need twice as many specialists”

“As a member of Cluster, we want to promote Lviv, and attract more new employees. If we want IT industry in our city to grow, then we need a large migration of talented professionals from other cities,” admits Andrew. The task for both the city and IT companies is to create favorable conditions for specialists from other regions to come here to work. It will also help bringing back many experts who have moved abroad. They need to see the city advantages such as lower costs of living, the ability to save their earnings, and attractive taxation system.

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“There is a struggle to get good professionals,” adds Andrew. However, he is positive: this problem does not freeze the industry. “All companies have to work to solve this issue together, and this is what Lviv IT Cluster does,” says Andrew. If the number of IT specialists increases twice and attracts 30,000 people, it will allow the local companies to develop much faster.  To achieve this, the city needs high-quality IT education, and promotion of the sphere among youth in the region.

“We want more people with Math skills to join IT, and we promote this idea,” says Andrew. He thinks the promotion should go beyond the city, and attract students from the entire region where people often lack knowledge about IT. Andrew mentions low awareness among the parents who do not understand what this profession is, and why it is worth studying. Since parents tend to influence their children’s choices, it is important to talk about IT with them.

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«IT is the only industry where after 3-4 years, you enter upper-middle class, and the incomes are higher than in other areas. The work environment is also very interesting because there are international trips and the ability to work with foreign companies,” continues Andrew. Working in IT allows people to have a much higher standard of living comparing to the rest of Ukraine, so it is important that future graduates understand the benefits of this profession. Industry promotion enables attracting more professionals and increasing IT market that has grown by twenty percent this year.

What IT City Needs

“Companies in Lviv have good growth perspectives here,” convinces Andrew. It is not only due to influx of professionals, but also positive city image. Lviv positions itself as IT capital of Ukraine, close to the West both culturally and geographically, and also, as the city far from the conflict zone. “If the foreign partners decided to go to Ukraine, it is easier for Lviv companies to convince them to work here. However, when it comes to competition with other countries, other factors matter such as the ease to travel,” he concludes.

Andrew adds: “Lviv as IT city needs good connections. It is necessary that slogan “Lviv open to the world” is not just words, but it is possible to buy tickets for a selected day and come here from London via direct flight.” The emergence of new flights allows getting new customers, and thus, increasing the flow of finances to the city. “As for the programmers, they need more infrastructure projects such as IT House,” believes Andrew. CEO concludes: “Programmers need to understand that the city will take care of them; then, more experts will move here. The city should focus on promoting IT to attract more people to this sphere. ”