Outsourcers Begin to Tap Russian Talent

Western firms discovering tech workforce

By Maria Trombly

April 30, 2001 12:00 PM ET

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Computerworld - Moscow
The second in a two-part series
Russia is often compared with countries in the West, regarding how far behind it is in economic development, democracy or life expectancy. But a better comparison, at least where technology is concerned, may actually be made with India.
Like India, Russia is a potentially huge source of technical talent, including recent entrants to the workforce and those cast adrift by the collapse of the state research apparatus.
Unlike India's, Russia's talent is mostly untapped. Although the Washington-based World Bank estimates that Russia has more than 1 million technically trained personnel—a little more than the U.S. or Japan, and three times as many as India - only about 8,000 people work in the nascent offshore software industry.

			Russian High-Tech Sector Leaves Corruption Behind The biggest fears some Americans have when dealing with Russia don't have to do with technology but with personal safety. Doing business in Russia is still often associated with murder and kidnapping, the mafia and, of course, corruption. These factors are becoming negligible, and many of the common perceptions of Russia don't apply to the technology sector, said Brian Phelps, president and CEO of Vested Development Inc. in Woburn, Mass., which also operates in Russia. Unlike other industries, which remain in the hands of old Soviet managers in new clothing, the people running technology companies tend to be ones who became established in the post-Soviet era. While the business climate has improved in Russia as a whole, the technology sector has progressed even faster, said Esther Dyson, chairwoman of New York-based EDventure Holdings Inc., at a recent conference on software development in Russia. "The software industry is something apart," said Dyson. "It is a separate marketplace, a separate world operating in a Russia that unfortunately still has a lot of the old system in it."

Russia today is where India was 10 years ago, said Brian Phelps, CEO of Vested Development Inc., a software development services company in Woburn, Mass. Vested Development recently bought a Russian software development firm.
But Fortune 1,000 companies have begun to recognize that Russia is a large and untapped source of scientific, mathematical and programming talent, said Ron Lewin, chairman of the IT committee at the Moscow-based American Chamber of Commerce in Russia (AmCham).
Lewin, who is also managing director and CEO of Toronto-based IT consulting firm TerraLink Corp., said that there are two ways for a company to tap into Russia's talent pool.
"One is to team up with an established firm," he said,

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