Be Wary Of The ‘One-Stop Shop’ IT Company
We hear from offshore development shops every day, and many of them claim to be experts in a wide variety of technologies and industries. Many offer things like graphic design, ui, and copywriting in addition to their software development services. To many clients this sounds like an ideal scenario – a single, integrated team of software developers to handle all their needs. In reality, this model can be very risky.
Nataly Veremeeva from Lime Systems joins me today from Kiev, to share her thoughts about why the one-stop-shop approach is so troublesome, and how both clients and vendors can find specialities that will bring the best ROI for their software budget.
Transcript of This Interview
Dave: Hi everybody. I’m Dave Hecker. Today we’re are talking about the Jack-of-all-trades, one-stop shop, IT company. These are the companies that advertise that they are experts in all sorts of different technologies as part of their IT services. They can usually do things like graphic design and UI, copy writing and marketing and just about everything. It all sounds very good and convenient for clients, but is it a good idea to take your business to a one-stop shop? Today, I’m joined by Nataly Veremeeva, from Lime Systems in Kyiv, Ukraine and she’s going to share her thoughts on whether or not a one-stop shop is a good idea or a bad idea for clients. Here we go.Welcome everybody, today I’m here with Nataly Veremeeva from Lime Systems in Kyiv, and she’s here to share her thoughts on the one-stop shop and specialization for shops and how to choose the right one. Nataly, welcome.
Nataly Veremeeva: Thank you very much for the introduction Dave. I’m happy to be on the interview and share my insights and experience with the people who will be watching it. So I’m just happy to be here.
Dave: It’s very nice to meet you. I was reading over the website at Lime Systems and it looks like you’re definitely not the Jack-of-all-trades one-stop shop. I’m seeing a huge focus on banking industry. So my guess is that your opinion is going to be that you don’t really like the one-stop shop and you think it’s not a great match for everybody, but let’s start off with your high level thoughts, what do you think about the issue?
Nataly: Actually during my eight years of career in the IT outsourcing, I experienced different projects and different styles of outsourcing. I had the experience of working with the companies who just used total different philosophies of being this Jack-of-all-trades and trying to get as much projects as they could, no matter which technologies. Now I’m just having really the possibility to work in different surroundings so to say. And I really think and I’m just sure that focusing in one technology and having one knowledge pool is just the core advantage. This is like something that helps build trust, helps build better systems and helps build the solutions and just being like good and honest business so to say. So yes, I’m really for the specialization and for narrowing the services offered to some particular industry, [inaudible 00:02:48], technology or whatever, just where the processes are being built. They are just solid and they are not… so the clients are getting what they actually wanted. But probably first I need to discuss the other sides, right? How to be like the Jack-of-all-trades so that we can then evaluate these differences between these two.
Dave: And you’ve worked like that before, have you been involved in the Jack-of-all-trades?
Nataly: Yeah, I was involved with that actually, it was during my career in this industry. I really started as a company, it was in 2005. And it was one of the first outsourcing companies here just like in my region. So we were really just like all the requests that were coming we said, “Yes, we can do it. Yes, we can do this. We can do that, we can do everything.”
Dave: But let me ask you something, you said something earlier that the reason people are Jack-of-all-trades is because they need to accept everything, every offer and every business or at least they think they do. I think when I see a company that says, “We are experts with .NET, JAVA and we do graphic design and UI and testing and everything.” And sometimes they say, “We’re working 24/7,” and all if this. The first thing I think to myself is they are very hungry for work. They are a little bit desperate. Why would a company be desperate? This is one of the hottest years for Tech ever. So if a company is working that hard, willing to take any job, then either they are just starting out or they are not very good. That’s what I think, that’s a little bit strong but what do you think about it?
Nataly: Companies are really hungry for work and they want to develop and grow. What happening is at first, when the company is just starting and this business just started, we didn’t have that exact understanding what it is about like the business objectives of clients, what it takes to give the added value of outsourcing, not just to provide people who would do everything. Because really, programmers like they are coding on JAVA, they are coding on .NET and that’s not a problem just to attract the right people from label market.
You are just like posting some job offer, get people quick and here you have a team. But the challenge here is that it’s not only about having the people, but also about organizing them right so that they are really just doing something. They are not just a set of software developers but they are a team and they are a team with the right expertise because different projects require different approaches, different methodologies. It could be a job, it could be water fall, it could be like different things.
Also some industries really have this big knowledge pool that is require to enter into it. So it’s not that easy. For example, to explain a team quickly about banking sphere or about just some financial or just some gaming like betting industry or whatever. So it can be so that the clients are really just taking these risks and just spending several months or maybe a year. Some complex industries educating the team but it takes time, it takes extra investments and here when you are seeing that outsourcing is not paying because you’re paying less but then the team just takes time for the team to get up to speed.
That actually is just something that is very often for just quite a lot of time may be before now and just right now this industry is more mature but before people need to get ready to get outsourcing. May be to employ some extra people like project managers who would be handling the communication issues, or just like they need to understand what they have inside of the company so that they… what they need from the outsourcing. So it’s just like any instrument, it can do harm or it can do good, It depends with how you are using it. So really…
Dave: Do you see companies from time to time that are doing everything, design and UI and Tech and they are pretty good? Every now and then we see it.
Nataly: It depends on what the clients wants actually, sometimes clients want just some software skills and they are prepared to take all the risk themselves or if it is some simple job. For example doing websites, you don’t really need some specialization so there could be some different technologies. But if you are speaking about really serious sphere and really just good project, companies that are greedy and take such complex projects, just being Jack-of-all-trades usually they end up with some disillusioned clients, it doesn’t end nice so to say.
Dave: But I agree that for something small like a website, like a word press or something, it can be okay to go to a small company that is doing everything. Is your feeling that for small stuff sometimes it’s okay and for bigger stuff you should watch out for the Jack-of-all-trades?
Nataly: I don’t like when companies when companies are focusing on everything. I think that each company when they are just developing, they are passing through this stage of maturity. First they are saying, “Oh, we’re an outsourcing company, we are going to get some profit,” and they start to do everything but then they understand that they need to have some unique offer, and then they tend to narrow and to make it like a more specific but this is already like a more mature company. When you see a company whose offering something and who’s saying, yes we are doing this but we’re not doing this, so they are refusing some projects but this is for the sake of quality. You can already tell that that’s a good sign so to say, so you can have more trust in such a company I think. For Lime Systems, it was like this from the beginning, it didn’t need to narrow their services but from the better start, from the better beginning I think they are already for 22 years, they are doing banking software, so they are pretty experts in this area.
Dave: But I know that you deal with a lot of other companies too, you have a lot of connections in Ukraine, so you must share this from companies that are small and they are willing to take everything and then you tell then you should begin to specialize your software developers and start to focus on your best skill and they are afraid to do it and they say, “We can’t afford to turn down any work.” That’s what I hear from companies, so what do you say to the young company that says … okay, I understand that we need to have some focus or some specialty but right now we just need work and they are in this trap, how do you advice a company like that?
Nataly: Just telling… put exactly the title like this is just about a choice, but what I see the tendency among the Ukrainian companies, I think maybe I’m more likely to face such companies at the moment but I have companies who are like doing specific P development or just some mobile development or I have a company who’re just like the recent technologies [inaudible 00:09:56]. They say we like this technology. And then we worked with other ones who are going to specialize on this one because it’s a good one and it’s going to very successful in the future. So they are taking only this technology and I like this because I think that that’s a good sign because our markets is like is becoming more mature. I even have a company who is specializing in Drupal I wasn’t like thinking that you can build a company around Drupal but right around 90 people at the moment. It will be a really like… they are just… I was just underestimating this technology for quite a long while but…
Dave: I’ve noticed… it’s true I know a lot of companies in Ukraine, and they seem to really understand to specialize. I don’t have to talk to them as much about avoiding being the general company as I do companies in India, I don’t know why but for some reason companies in India they’re very quick to say we do everything, like the body shop model. We hire people from university and we’ll take any job and we claim to be the experts in everything. Even a company with 3, 400, 500 people is still not specializing, why do you think Ukrainians are more sophisticated in understanding the value of the business focus? Is this what you see?
Nataly: I think that’s just may be the difference in mentality, I don’t know why Indian companies are behaving like this, I was for quite a while frustrated about the bad reputation for outsourcing that Indian companies created because actually I had like experience when clients were coming and saying, “We’ve just tried out that sort of thing and that was horrible.” So…
Dave: But in a way, it’s good for you though because mostly Indian companies, they really hurt the reputation offshore development but mostly they hurt it for themselves. Don’t you see a lot of clients that have already been through an experience in India and they really are tired from it and they come and they say now, “I want a more professional arrangement,” and they come to Eastern Europe?
Nataly: Yes, that’s right. Kyiv, we really can market ourselves. We are just like a bit more expensive location than India but at the same time, we really can offer this quality and this like understanding. Our developers are famous for even arguing with clients about the best way to do things. If just for startups, it can be critical when they need some… just not only, “Yes, sir. Yes, sir,” but some ideas. So this is how our developers… they are famous for it. And also I actually read today that in Ukraine in fact it was created the first computer in Soviet Union. It was somewhere around Kyiv by [inaudible 00:12:51] 1951. I didn’t know about this before but we have a lot of fundamental science and just really a fashion to be like a software developer too, it’s just like some kind of new intellectual elite and yes we are just a bit sophisticated that’s right…
Dave: It’s pretty sophisticated. There is kind of an elite feeling to the software business. when I’m in Kyiv, I visit Kyiv a lot it has this feeling, it’s similar to the way that San Francisco is in that there is a little bit of excitement. People don’t just have a job doing software. There are these young, energetic companies and they have cool offices and software developers are making pretty good salary and they are feeling pretty good. There’s a lot of energy in Kyiv, it’s not some sleepy sad town, right?
Nataly: Yeah, that’s right. And we have even a fashion for being a software developer. Like now software developers in Ukraine are just getting pretty good salaries. So they are like one of the rare middle class people so to say. And we have even [inaudible 00:14:04], he’s like a perfect man so just like women are just dreaming to date some software developers.
Dave: Wow, so beautiful Ukrainian girls are going for the software developers?
Dave: Oh my gosh, we have to write that down, that never happened in San Francisco.
Nataly: We even have the websites for the people just to go and select, try to find some software developers.
Dave: They are just dating IT guys, right? Boy, I missed out on that. When I was dating there was no support for the IT guys. But what about Ukraine in general, all these politics in the news, that’s what Americans think of now. When they think of Ukraine, the recent politics have taken over everything but I tell them… I hear this almost every day, is it okay to go to Ukraine? And I’ll tell you what I tell people, you tell me if you agree, it’s pretty bad situation in Ukraine but a far as software business in Kyiv, you don’t really feel that at all. You hardly know about it except that people talk about it but everything is stable and over in Chortkiv, where all the younger developers seem to talk about it even more but everything is perfectly stable. And after that, I think as you move to the East, things can get troublesome but there’s not so much software over there and I think it’s okay.
Nataly: Yeah, I totally agree with you. I can say that I, myself, come from the East. So I was there and I was still [inaudible 00:15:39] of the club local IT companies. They were around 30. They all moved. So they are just like… the idea about the advantage probably about software development is that it’s not a meteorological plant. They’re only resource of people and you can just easily relocate them. So all the 30 companies that are [inaudible 00:15:59]. They just moved to other parts of Ukraine and just without losing and affecting projects or loosing clients or loosing resources.
And just for the virtue, Ukraine is actually comparatively huge. It’s like France and that was like wide. So I was calculating the distance between the troublesome region in the East and for example [inaudible 00:16:23] which is like the western part close to Poland and European Union is almost the same as from the [inaudible 00:16:28] to Copenhagen. So it’s just like several countries, so you are just not really-really feeling about that something is going on a part from the economy is shaking because they have military costs and everything and also the currency changing but we have our exports services, so that means that we are not really affected by this.
Dave: Is it frightening away new clients?
Dave: Is it frightening away new clients?
Nataly: I wouldn’t say so, the only thing is that bigger companies really need it to apply some extra effort to persuade the big existing clients that it’s safe to stay in Ukraine because they are using these risk assessment models, and by risk assessment models Ukraine is really like not the safest place to be so to say because there are some risks. But generally it’s even like advantages because some of these big clients really just shot and their volume of software developers who really have a lot software developers, just a very good quality on the market. So potentially gives extra advantage and also like some inner projects also just some companies that are focusing in some inner software development, some of them are stopping also because still the economy is also feeling this because of these military costs. But it also gives some extra advantage to do some outsourcing and I don’t see personally significant risks for this.
Dave: Me either. But I hear about it so much. You know I deal with American clients so a lot of them don’t k now how large Ukraine is, they think that there is fighting everywhere.
Nataly: Yeah, it’s just the news, the news channels are not like really saying that, here is nice and here is like a stable region. They are just interested in some explosions, like bombings and just action and that’s why they are showing a tiny piece of Ukraine but it’s just like get the impression that the whole country, which is not the case.
Dave: Yeah, we are still sending lots of work there. As far as I’m concerned, I’m not too worried about it. It’s kind of sad that everyone has to go through it but as far as the software industry, I think it will be okay.
Nataly: Yeah and the society itself is really feeling this reawakening, we have like this period of really like wanting to do something and turn our system into something like more democratic. Ukraine is really feeling strong right now, at least I feel it like this.
Dave: Really, especially in Kyiv right? There’s…
Nataly: Yeah, in Kyiv. This is like the revolution place.
Dave: I felt that when I was in Ukraine, I think there’s a lot of energy. People seem very excited and energetic to push through these problems and build their economy and sort of grow the country. I don’t know what it’s like at the very-very Far East but where I go in Ukraine people are pretty positive about the future, a little unhappy about the present but they are feeling pretty good.
Nataly: We are just having this… we need to keep strong and just to break through and to do things and yes we have some strange things like volunteering for example, so people are dedicating their time, efforts to change the system for free which is like the spirit that we are experiencing at the moment and this is amazing to watch and also to be a part of it.
Dave: And Ukrainians are tough…
Dave: I think they are tough and I think that’s one of the reasons that the the software developers are good at Agile and they are good at software. Like earlier you said you don’t want to be the sort of the yes man type, that you see an issue sometimes. It’s really a b ad match in software, in software you need some people to speak up and Eastern Europeans and Ukrainians are good at this and I think it makes them … they are very quick to… if they see a problem they’ll say something about it and it makes a big difference. So it’s a very mature community in Ukraine but back to the idea of the Jack-of-all-trade, so let’s say a company like Lime that’s focused in banking, how focused are you? Is it just software development or is there QA, is there a little bit of design, how much broad scope do you think is okay?
Nataly: Actually we have like everything that… since we’re developing products for the local Ukrainian market, we have everything that takes to make these banking software products. We have business analysts, project managers, some technicians, some QA people for sure, help writers, developers, senior like junior like all sorts of developers, and we have the company supported is into units, for example we have like internet banking unit, we have some co-assist and banking unit, credit card unit and others. So every sphere of banking activity is like… cryptographic unit also just is dealing with encrypting the information. So we have different scopes, different aspects of just dealing with banking sphere in different departments and I think that we are pretty focused but at the same time we have everything that is required for life cycle that it takes to do a banking project.
Dave: May be your company is very-very focused, the sector, the space that you service, the banking sector but as far as the specific technology, everything that you need to develop for those clients, do you think it’s more important for a company to focus on an industry or a sector than a specific technology?
Nataly: I think it takes both, for example some industry require some technology for example in banking you’re normally not doing some [inaudible 00:22:48] work or whatever, you need some really reliable technologies that are just nice. In our case, this is .Net technology because it’s licensed, it’s supported, it’s secure. So we are the gold partners of Microsoft and we are like focusing on this part. So we are just. Net, everything is connected with .NET, C#. And also just modules, for example, we are making integrations with a number of systems. We know some Telewig, we know some Windows Mobile, something else, just like a number of technologies that we are using, again, with .NET and with banking systems.
Dave: So what do we say to a client, I think that we both agree that specialties are good and the Jack of all trades can be bad, but what do you say to the client that comes and they say they have something like $10,000, it’s a small client and they need to do a small website for their business and they are not really sophisticated clients and they say I can’t afford the specialty companies, I need everything and I don’t really know what I’m doing, what do we say to these small clients? Do they need to go to the one stop shop or even for them is it kind of bad?
Nataly: I think they need to find passionate companies. The companies that are not just doing something for money but companies who love what they do and may be they can even just not specialize in everything but on the contrast specializing in everything but you’re working with teams. So even with this wider company you can find some team lead project manager or some business unit who is really passionate about what they do. You can feel that when speaking with people, if you see that in their eyes when they are speaking about some specific technology that you are interested in. That could be a good sign and just it’s more often to find such things in some companies which already made a specific focus, but even there’s some wider companies, probably you can find some passionate people inside but that again you need to be really psychological and look into the eyes of people because you’re working…
Dave: You have to analyze their psychology.
Nataly: Yeah, because you r just working with people, you are not working with machines so it really needs to be like a person who likes the technology and likes the idea that you are just having your business project and then…
Dave: I wrote that down, find passionate companies. It’s a great thing to tell clients because I think that some small clients don’t really have a choice, they can’t go to these specialty companies that only do graphic design, and then another one that only does front-end, it’s like this, they can’t afford it. And there’s also a lot of small companies that are just staring and they can’t afford to skip any work and it’s a great piece of advice for them, to tell them, if you have to go to the one stop shop fine, but find the company that is passionate enough to make it work because a burnt out team of software developers is pretty useless. It’s great advice. That’s going to be, I think, the tweet from this interview, just find passionate clients. All right, very good, I think that will be it, we’ll wrap it up. Thank you very much for your input and your insight and your thoughts about what’s happening on Ukraine, it was very nice meeting with you and chatting with you.
Nataly: Yes, it was my pleasure and just hi to all American clients and to everybody from [inaudible 00:26:27] Ukraine.
Dave: All right, thank you very much, bye.
Nataly Veremeeva, Lime Systems
Lime Systems is an established developer of complex banking systems with more than 22 years of experience and over 150 highly specialized specialists. Bank products created by Lime Systems are used in more than 40 banks in Ukraine.
Latest posts by Dave Hecker (see all)
- Empowering Developers: The Software Estimation Hotseat - April 18, 2017
- Impressions from Lviv IT Arena 2016 - October 11, 2016
- Contracts with Russian Teams: Interview with Gene Taschkinov - September 30, 2016