Peculiarities of Nearshore business: Why and How to Improve Attrition Rates of the IT vendor?

QArea Team by QArea Team on January 11, 2013

Peculiarities of Nearshore business: Why and How to Improve Attrition Rates of the IT vendor?
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How businesses usually reflect on the outsourcing software development services? Most of them find collaboration with IT vendors risky because of high attrition rates. Attrition rate describes the rate at which employees leave IT company.

Even IT companies with well-developed hiring and management infrastructures fail to deliver services without brain drain.

Peculiarities of Nearshore business

Eastern Europe Labor Market

Most of the IT companies with established reliable reputation and big expertise make all their best to improve management policy in their company. Quality vendors organize frequent talks with their employees discussing team’s needs and suggestions. Despite the high level of educational system of Eastern Europe countries, teams have trainings and upgrade their skills periodically. The next factors play a major role among highly skilled software engineers in Ukraine:

  • Earning reputation among the peers by resolving highly complex challenges;
  • Autonomy organization structure in the companies;
  • Developers love challenges and complex technology development;
  • Promotion as a career development path is not so important as in offshore IT companies.

What Can Increase Attrition?

Remember, the lower level of attrition rate, the more stable IT company is. For example, attrition rates of Indian IT companies are more than 50% and of Ukrainian or Russian are 10%. Of course, these are total results, India as well as Ukraine has lots of reputable companies with low attrition rate. But when this number stars growing company should set actions to stabilize situation. Even if the company pursues a stable management policy, for software engineers it’s very hard to work on the one place more than two years. People want new challenges, higher rates and new interesting people to share and adopt experience. Long-term partnership is always good for both the client and the vendor as makes software engineers staying on while working together under creation of the common child.

Key Points of Successful IT Employer

Wise managers always make all their best to make staff stay longer with the company. You should check an attrition data when choosing an IT vendor. If rates are favorable, try to understand why this number is so attractive. QArea managers share their own experience of stable situation with their staff:

  • Advanced management policy that is based on corporate values and culture;
  • In order to interest the team managers make members rotation within teams;
  • An individual approach and development programs for each team member with frequently trainings;
  • Agile implementation level of every project;
  • Senior, middle and junior hierarchy levels of engineers;
  • The best employees participate in the international conferences and professional meetings.

Client Contribution

What you as a client can make to support team and make collaboration with your IT vendor more efficient. As you know the most powerful tool you can use is motivation. But here you some pieces of advice to consider:

  • Make sure you provide high level of knowledge sharing and transparency;
  • Rotation of team members and duties;
  • If company doesn’t provide trainings to the staff, you can promote it and streamline new skills in your direction;
  • If you can, try to create long-term plan of collaboration with new tasks and challenges.

Of course, all these means require money but you invest in the future. If you build relations with IT vendor based on trust, finally you’ll get more. Make your contribution to improve collaboration with the IT team and you won’t have to spend money on new members or incur losses due to downtime.

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