Insights

The global IT outsourcing market is projected to reach USD 407.29 billion by 2023, according to a new report by Grand View Research, Inc*. This growth will be driven mainly by increased demand for cloud-based services, automation of business processes, and other cost-saving benefits. Furthermore, the increasing adoption of Internet of Things (IoT), artificial intelligence (AI), and machine learning (ML) technologies are expected to provide a significant boost to the IT outsourcing market.

In addition, the increasing adoption of open-source software, the growing need for application modernization, and the rising demand for data privacy and security are expected to further fuel the demand for IT outsourcing services in the near future.

Outsourcing gives companies a competitive advantage by reducing operational costs, enabling staffing flexibility, and saving time. Because of these benefits, more companies opt to outsource business processes, prompting outsourcing market growth.

Here are the key trends to watch out for in 2023:

Strategic partnership – Companies now believe a strong strategic partnership with fewer outsourcing companies can ensure business continuity and operational cost savings. A singular (or fewer) outsourcing partner enables stronger business relationships, increases transparency, and induces trust which, in turn, makes reaching objectives easier. Additionally, companies can ensure continuity with an outsourcing partner through a more extended outsourcing contract.

Global delivery – in an analysis published by Deloitte** they state that following the Covid pandemic more and more companies are prompted to adopt flexible working methods. The necessity to be agile, the ability to find the specific talent and expertise wherever it is – because in the new world, geography carries no weight. Another study by Gertner*** reveals “Talent Shortages as Biggest Barrier to Emerging Technologies Adoption”. With the Global delivery approach, the ability to work with the best experts from anywhere and at any time opens the game and expands the bandwidth of relevant players.

Modern Technologies – as the old saying goes “do what you do best, outsource the rest”, this saying stands its ground with software development as well. An outsourcing service provider is an expert in their specific field. As a result, they’re more likely to update themselves about the advancements in technology than an in-house team.

Startup surge – Outsourcing allows small businesses or startups to access the best talents and tools at economical prices. These businesses outsource repetitive tasks to save time and money. Small companies are also less likely to have experienced employees due to their limited payroll budget, and outsourcing enables them to access the best talents.

Go east (Europe) – Revenue in the Eastern Europe “IT Outsourcing” segment was projected to reach US$2.69bn in 2022. And revenue is expected to show an annual growth rate (CAGR 2022-2027) of 17.17%, resulting in a market volume of US$5.94bn by 2027****. Companies in North America like the United States prefer East European countries, like Romania, Ukraine, Poland, and Belarus, for IT outsourcing due to their proficiency in English and cultural similarity.

Also, Eastern Europe has a high percentage of skilled people (including tech professionals), affordable talent, and strong data security.

To conclude, outsourcing IT projects in 2023 would be a wise decision for companies who want to save on costs, benefit from access to a global talent pool, and take advantage of the latest technology. Companies should carefully evaluate and compare their options, and select a vendor that can provide reliable, secure, and high-quality services. Doing so will ensure that the project is completed on time, within budget, and with the desired results.

*https://www.grandviewresearch.com/industry-analysis/it-services-outsourcing-market

**https://www2.deloitte.com/us/en/pages/operations/articles/shared-services-survey.html

***https://www.gartner.com/en/newsroom/press-releases/2021-09-13-gartner-survey-reveals-talent-shortages-as-biggest-barrier-to-emerging-technologies-adoption

****https://www.statista.com/outlook/tmo/it-services/it-outsourcing/eastern-europe

October 2022 is bringing with it enhanced degrees of difficulty and uncertainty, the financial climate in general, and especially the high-tech industry is turbulent and unclear.

The beginning of Q4 is usually crunch time for most companies. It was during my tenure at IBM that I took the crash course on this subject. There is no better school for “End of year” strain than the one at a publicly traded company and if it’s an international corporate traded on NASDAQ even better. There is no tomorrow after December 31^st.

All the Milestones, releases, demos, POCs that you committed to delivering throughout the year and postponed/forwarded to the next month must be delivered. All 2022 related investments, bonuses, and terminations… are knocking on your door and as always, time and resources’ availability are not your allies.

2022’s end is not business as usual, as in the 1939 “The Wizard of Oz”, Dorothy says to her dog at one point: “Toto, I’ve got a feeling we’re not in Kansas anymore.” Recent management research and publications are addressing the fact that traditional/textbooks/best practices of business strategy (and tactics) are becoming futile once facing the fast pace of change and continuous uncertainty that we’re facing.

October 2022 is bringing with it an enhanced degree of difficulty and uncertainty, the financial climate in general, and especially the high-tech industry is turbulent and unclear. This environment is adding two crucial parameters to the equation. Imminent demand to economize which is corporate slang to cut costs dramatically. The demand to stretch the “runway” is amplified by the second variable which is the lack of visibility to 2023 budgets, information that will enable us to take the necessary actions and investments that will not become obsolete on January the 1^st. The new (business) world order requires us to be more agile, resilient, and decisive.

Paving course of action will start with mapping out our situation, starting with our 2022 “commitments” and available resources and transforming them into 2-3 alternative high-level release plans. We should incorporate issues like the order of importance and levels of risk. Once articulated, we will perform a crucial step which is foretelling the worst-case scenario for each alternative. This action will inhibit the Project Planning Fallacy (a common bias that implies, however long you think you need to do a task, you will actually need longer. Regardless of how many times you have done the task before, or how deep your expert knowledge is). In regular times this phenomenon has damaging potential. During Q4, it becomes extremely critical, there will be no overtime after December 31st. The conclusion of the process will include the selection of the optimal release plan and the construction of a detailed release plan (Sprints level).

At this point in time, missions are prioritized and the list of the required resources is established. The first choice is usually diverting resources from less crucial activities, if applicable, great. Nonetheless, we’re required to double-check that we’re not inflicting over “less short-term” (Q1 release dates are right around the corner) for the short-term demand. If this solution isn’t feasible the next step is checking our recruitment pipeline to review whether there are candidates in advanced stages and can be signed in the next week or so. The “usual” challenge with this path is that even if there are potential recruits their notice time plus onboarding duration (30 – 45 days) will prohibit any real Q4 contribution. This year “unusually” there is a chance that there is no open position for recruitment chances are slimmer than regular.

Once internal alternatives are exhausted, we should consider an external team enhancement. To those of you that are puzzled by the inconsistency between “external” and “reduced cost,” the answer is: consider a team that is onboarded ASAP and dismissed at the end of the year. No residual effect on other R&D commitments or recruitment/notice costs. If you want to go the extra mile, you may even consider going offshore. The issue with offshore development at the end of the year is that usually they are one week short at the end of December, one very crucial week. On the other hand, there are hybrid Israeli-offshore solutions that will enable us to attain reduced costs and the additional working week of the 25^th.

The team is established, the backlog is set, and the first sprint commenced. There is an additional factor that can increase the probability of success. We should establish process transparency with our team. Maximizing knowledge of the situations and the context will enable the team members to both adapt and step up for the occasion.

At times like these, I recommend embracing the legendary basketball coach and leadership guru, John Wooden’s words of wisdom “Do not let what you cannot do interfere with what you can do”.

It’s time for operational efficiency?, click for more information on how CodeValue cab assist you with OPERATIONAL EFFICIENCY

Published by Hanan Zakai

VP Customers & Division Manager @CodeValue

It has been 2 years since we’ve had the pleasure to meet and greet in person, and the long wait was worth it! over 420 people gathered for a full day of invigorating talks, mingling, and some good food.

What was it all about?

Time brings change, and COVID has played its role as a catalyst in that matter. Recent effects have led to an unprecedented shift to remote-first work culture and accelerated multi-cloud adoption, not only in terms of harnessing tools and platforms to be used to serve one’s business but also in the products and systems that the company builds, demanding elevated requirements regarding hybrid and cross-platform scenarios. 

In the software industry, we are expected to be agile and adapt to changes quickly and effectively. This isn’t related merely to development but spans the entire business, product, R&D, UX/UI, architecture, technology, development, and DevOps. 

The need for building software that can operate on and/or integrate with different platforms is rising steadily. New levels of productization, process, and automation are required to meet the new challenges at a high pace, as well as find effective ways to scale MVP products and R&D. 

Therefore, our job as leaders, architects, and engineers, to figure out how to build and best use technologies, tools, and platforms to meet such diverse needs and scenarios, has become more and more challenging. 

This was the fifth consecutive year of CodeValue’s Architecture Next conference. Throughout the day we discuss revolutionary and innovative concepts, technologies, and tools while showing how these can be leveraged and applied to make business, processes, and systems better. 

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General assembly

The conference day was launched with an introduction by SpeedValue’s & CodeValue’s CEO Tali Shem Tov and Chairman Ayal Zylberman. Tali & Ayal delivered a brief talk about the changes we have all experienced during the last 2 years and what those changes entailed for our industry.

Keynote: Architecture Stories from the Trenches – Alon Fliess

The keynote session was delivered by Alon Fliess, CodeValue’s Chief Architect that shared with the audience his experiences of over 30 years of significant software development, design, and architecture projects for global leading and cutting-edge companies. 

Software Architecture in the Multi-Cloud Era – Amir Zuker, Rotem Barda (Vayyar), Barak Mor

This talk is about building systems with respect to multi-cloud, focusing on architecture and technological concepts in addition to business aspects. One of the key principles to achieve it is to build the right abstractions.

How do you do that though? There are so many options to choose from, what are they and how do you implement them? In this session, we tackled these subjects head-on while sharing real interesting demos in the process. Furthermore, we presented a real-world case study of one of our existing customers, Vayyar, and discussed our journey together in transforming their business, product, and technology towards multi-cloud.

Experts Panel

Alon Fliess, Amir Zuker, Hanan Zakai, Amit Kinor, Tomer Karasik, Nir Dobovizki, Eran Barghil.

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Executive Track

The Perfect Host – An Ongoing Story

Alon Fliess, Chief Architect at CodeValue (MVP & Microsoft Regional Director).

Web3: From A to S (Security)

Tal Be’ery, CTO Zengo

From Offshore to Global Delivery

Tali Shem Tov, CEO & Co-owner, CodeValue & Esti Felba Hermesh, Director of Global Delivery, CodeValue.

Artificial Intelligence, Machine Learning (and when not to use them)

Nir Dobovizki, Senior Consultant and Software Architect & Backend Practice Lead  @CodeValue

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Technologies Track

Composable Components – Play Application Lego

Tomer Karasik, Technical Lead and Software Architect at CodeValue & Ilya Holtz, Senior Full Stack Developer at CodeValue

Building Modern IoT Data Pipelines

Alon Amsalem, Software Architect & CodeValue

Micro Front End – Web-Components in Practice

Yehuda Buzaglo, Senior frontend @CodeValue